From an earlier conversation I was having with Swish:


It's a huge problem. When you are a defense contractor doing 90%+ of your business with the federal government, what kind of message does it send that you spend that kind of money, over that many years, into repurchasing your stock. I'd be curious to see how much more F-35s and whatnot we could have gotten from them for that amount. I can see that some would retort on that front by saying "It's their money!" Just ask where they got it from and how they were able to get that much of it. For me to sum it up, would you (the universal you), a taxpayer, be content knowing that a business that gets its income almost entirely from the government earns enough to repurchase its own stock to that magnitude?

A lot of people are complaining about sending aid to Ukraine, but apparently most people feel comfortable that we give our defense contractor - just one in this case - that much cash that they can put that kind of investment toward just repurchasing your stock. It goes back to the Jack Welch era at GE where shareholder equity trumps all else, including capital investments and a quality product (see Boeing for a prime example on that front). It also doesn't end with Lockheed. Check out how much RTX has invested recently into repurchasing its own stock.

The other big problem is that they are prioritizing things like stock repurchases over prioritizing investing in their own capital. Some contractors aren't even reinvesting in their own capital at the depreciation rate. Why? Well, there is no competition. The long term problem, though, is that I don't know how this will affect our long term readiness. Boeing has already hit the drop zone, both on the commercial and military side. Years of prioritizing short-term shareholder gain at the expense of quality products and capital investment has done a number.

I have concerns.

It definitely feels like our economy has focused on selling junk just to sell junk more than actually effectively producing what the country/world needs. It seems there is too much focus on producing profits/ensuring the financial numbers go up with minimal regard for what is actually being produced.

I certainly agree with you there. But isn't that actually the goal of capitalism?


I suppose we could debate the part about "minimal regard for what is actually being produced" but it seems as though that isn't the actual premise of capitalism. Their duty is only towards maximizing profits for the shareholders. I would love to see them care about what they're producing as much as they do the profits they generate but I don't see why it would benefit them to do so.

I believe 05 covered the problems faced not only by the defense department for the conduct of their contractors but also it covers what all of us as consumers face as well.

Don't get me wrong, on paper, in theory capitalism looks to be a great system. In theory it promotes competition. That competition used to be who could build a better mouse trap. Now the competition seems to center around who can build that mouse trap the cheapest and get the most money for it.

We talked about the Jack Welch affect at my meetings last week on America's style of capitalism, and I think that was the watershed moment of where things went south. You can look at GE and a lot of public companies before his time talking about how there was a duty to employees and a duty to the customer, and hell, even a duty to pay taxes. He really ushered in the era of "screw everyone over except our shareholders" (I know that's a crude adaptation, but the message is there). He was what I consider another figure from the 80's that is historically revered for short-term gains that actually resulted in grave, long-term damage. It started with him, and then it went viral amongst a lot of the other companies. I think we are starting to experience the chickens coming home to roost.

Here is a good article on his affects from Forbes:

https://www.forbes.com/sites/kylewe...an-who-broke-capitalism/?sh=34a3b6cd95a6

It actually ties what we are currently seeing at Boeing to him.

What I think a lot of people cling onto as the pinnacle is the style of capitalism that existed in the United States from 1945 through about 1980. And you know what, I agree with that. It was great. However, that is not what we currently have. Just look at the individual tax rates and corporate behavior prior to figures like Welch and Reagan vs after, and it's easy to see when things started going off the rails.

Cause those defense contractors within the military industrial complex still are participating in the free market, which people want to have zero limitations on.

Honestly that’s the biggest conundrum our society needs to address - how do we deal with the policies that our taxpayer money (socialism) pays defense contractors billions of dollars to develop tech and given massive tax breaks, only for those billions to end up being used for stock buybacks (capitalism) and NOT be considered fraud and corruption?

I agree. I wasn't actually sure at what point it all changed or who spearheaded the change and I appreciate you heading me in the right direction on that.

Republican politics 101, been that way since they bought intto the trickle down BS. I can’y believe young me bought into the GOPs bull crap. Until George the 2nd, the second dumbest president of my life, I was sold on the GOP being good for businesses. But in retrospect, every major hit I ever took (the out of my hands type) come either during or on the hells of a Republican administration. I have watched dems repair the economy for almost the entirety of every Dem admin since Reagan. I don’t see how anyone can claim a dem president would be bad for the economy, not after the GOP’s record. I was to young to pay attention when Carter was in and don’t remember what cause those economic woes, but I’d be hard pressed to not suspect it was GOPer policy or actions that caused it.

And the fed not dropping rates won’t fix inflation, or at least not the current brand of inflation. This was caused by greedy ass corps not wanting to pay fair wages and a poorly managed global pandemic. Either way, Biden has done a hell of a job cleaning up the mess. Give him four more years with a dem congress, and America might actually be great again.

My biggest concern about them focusing on profits is the continuing of a dumbing down in public schools. If the latest generations can’t innovate their way out of these types of messes the country is doomed, we might as well let Putin have it now. And didn’t people like MGT, DJT, or MAGA in general ever take a history lesson? Some of the crap being spewed in congress sounds like a fire sale on democracy. I would have never imagined crap like the Putin love or excusing all the crap DJT has done from the GOP I knew. Never. The slightest imperfections used to send a candidate on the walk of shame, John Edwards coming to mind. What the hell happened to those republicans? They have are running a dog turd with a laundry list of imperfections, criminal behavior, embracing commie Russian and other less significant dictators, and bizarre bordering on insane world views and ideas. I can’t figure out what went so bad when we elected Obama to trigger all this anti-American authoritarian BS… whatever could it have been?

Well you know what they say, if you can't win it lie about it. And if lying about it doesn't work just figure out a way to take it.

Thanks. I didn't have a clue either. The two PhDs who presented on it last week shed a lot of light on them. One was a former CFO for a fortune 500 and the other was more of a modern tech geek who could put the numbers behind the theories. Together they made for one hell of a compelling case.

I think you and I fell into the same trap, initially, which was that we thought we were buying into that 1945 - 1980 style conservativism (Eisenhower, Nixon, etc.) with the modern era Republicans. I think you and I have diverted in that I still uphold that kind of ideal whereas you have gone down more the route of an FDR-like ideal, which I do understand, given how things have skewed since the 1980's.

I think the dynamic of where the modern-day far right wing of the Republican party is actually a somewhat logical step, given the direction of the party starting in the 2000's. Reagan got the ball rolling by his tax cuts. When you compare him and another Republican "legend" like Eisenhower, their tax rates were immensely different, yet both are Republican heroes. He also spent into oblivion (not a conservative approach) and instituted trickle down. That cascaded over the decades to the point that a lot of the poorer Republican base started to mistrust the party, as we saw with the rise of the TEA Party, rolling right into the 2016 election. They were mad because they were Republican, but they weren't getting anywhere.

They began to mistrust the political institution on the right, and they maintained their already-existing disdain of the left. The time became right for a change in 2016. That year really was the perfect storm. The Dems decided to put up a horrific candidate, and Trump demagogued his way by pandering to those aforementioned that were already ticked off with the Republican establishment. Add him pandering to the evangelicals with Pence, and, welp, here we are. The playbook was written, and all that people like Gaetz, MTG, Boebert, et al are doing is just calling plays from that playbook. A huge section of that playbook is devoted toward avoiding repercussions.

Really, we are the new ROME, you can get anything you want---but you have to pay for quality vs utility.

Both political parties have printed our money like Monopoly money for decades. Look at historical interest rates- the young have NO concept about what saving and scrimping for a down payment- Carter and 10 percent car loans - home loans in 70s- start at 7.9 went to 12. something at end of 70s.......we have been artificially keeping interest rates low for DECADES.

Stimulation checks have become the norm- bail out the auto makers, the students, small business= just print more money. It doesn't really matter. WOW- wonder what happens when the glass house breaks.

I think our current economic policies are still a little too tech heavy. China continues to secure physical resources across Africa and other regions, while we’re continuing to secure intellectual properties, such as semiconductors. I get the digital world is only gaining speed, but on the ground diplomacy/infrastructure development should still be the main focus.

Not to mention the fact that intellectual property is only as good as the country enforcing the laws surrounding it. We see them as the gold standard here, while China sees them as opportunity to lower R&D costs to a minimum by........basically not respecting IP Rights at all. On top of that, they are securing physical property and mining rights.

They truly have a locust mentality.

lol, there’s something poetic about your locust analogy as we’re experiencing a great emergence of cicadas in the US.

Or maybe it’s always been a scheme designed by the deep state #freeQ

Lol, well, I'm sure MTG will be tweeting about how it's a pestilence plague designed to make us repent again.

https://www.linkedin.com/news/story/us-economic-growth-slows-sharply-6004564/


US economic growth slows sharply
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By Alessandra Riemer, Editor at LinkedIn News
Updated 2 hours ago


U.S. economic growth expanded at the slowest pace in almost two years during the first quarter, as consumer spending cooled and inflation picked up. Gross domestic product grew at a 1.6% annualized rate, the Commerce Department said Thursday, undershooting economists’ expectations for a 2.5% pace. Last quarter’s growth also trailed the 3.4% pace of the prior period. With a key price gauge jumping in the report, an initial estimate, the Federal Reserve may need to refrain from lowering borrowing costs for longer than had been expected.

The Personal Consumption Expenditures price index showed that inflation, excluding volatile food and energy prices, accelerated to 3.7% during the first three months of the year, from 2% in the prior quarter.
The GDP report also showed that, while spending on services rose, it fell for the first time in more than year on goods, including cars and gas.

https://www.cnn.com/2024/04/25/markets/wall-street-reaction-gdp-report/index.html

Dow sinks nearly 700 points after GDP report, heading toward its largest drop of the yearEconomic growth appears to be floating back down to earth after notching a very strong second half of 2023. GDP grew by 4.9% and 3.4% in the third and fourth quarters of last year.

At the same time, Thursday’s data showed that inflation accelerated in the first three months of the year: The annualized GDP chain price, which measures how much prices have gone up or down in the economy, helping to track inflation, jumped from 1.6% up to 3.1%.

“The Fed wants to see inflation start coming down in a persistent manner, but the market wants to see economic growth and corporate profits increasing, so if neither are headed in the right direction then that’s going to be bad news for markets,” wrote Zaccarelli.


Those sticky inflation rates have pushed investors to slash their expectations for interest rate cuts by the Fed. They’re now anticipating just one cut this year, according to the CME FedWatch tool. That’s down from an expectation for six at the beginning of the year.

It’s also brought back fears of stagflation — when the economy stops growing but inflation persists.

In a talk at the Economic Club of New York on Tuesday, JPMorgan Chase CEO Jamie Dimon warned investors about a potential period of stagflation.

“Stagflation has the negative effect of no growth and inflation. That hurts profits and consumers and jobs. And yes, I think there’s a chance that could happen again,” he said. “I worry that it looks more like the 1970s than we’ve seen before.”

Between 1966 and 1981, a period encompassing much of the stagflation era, investors in the US stock market lost more than 35% after adjusting for inflation, according to analysis by Ben Carlson at Ritholtz Wealth Management.

Fed will hike rates again now… smfh. I think this is China’s housing crisis showing up here. We should help them fill those 40 million housing units by sending the Anti-American Putin loving MAGAts to them.

Curious to know how consumer demand can decrease, but inflation can increase?

No corporate price gouging here…

I mean, what other explanation could there be? I am no economist so I can't say that for sure. We do already have proof though that gouging has definitely occurred. It's a "pigs get fat, hogs get slaughtered" scenario. Corps get exorbitantly greedy with their margin opportunities, while at the same time demanding that the Govt stay out of their business. You can't perpetuate that coexistence for long, ideally. However, we have had so much lax antitrust enforcement and so much corporate lobbying in politics that I don't know when the fever pitch point will be anymore.

And that seems to be a common theme when people concentrate on what the problem is more than what caused the problem. We all know what the problems are.

The problem is multi-faceted. I could blame it on COVID, but it's more fairly blamed on greed. At least greed is the biggest slice of the pie chart.

And it's not just corporate America, it's at every link in the chain. COVID created the largest excuse shirt in our history, it make the Browns QB jersey look like a crop top. No matter how high your price hike is, no matter where you resided on the food chain, just start every excuse with "Well, with COVID...

A friend that's still in the restaurant biz kept bragging "I raised chicken parm to 23 bucks, bro, they're paying it. When they ask why, I just say 'because COVID'. When they ask anything I just say 'because COVID'."

Was he paying more? Of course, but not enough to reflect his price changes. Nor was that true with any of the markups along the chain. The purveyor that was charging more because "broker". The broker who was charging more because "contract producer". The contract producer that was charging more because "manufacturer". The manufacturer that was charging more because "feed prices". The farmer that was charging more because "labor"... and on and on. It was a free ticket that, by definition, meant we wouldn't have stability again for years.

Add the perfect storm of labor and labor shortages. So many people simply scared to work. Free checks from the govt -- I'm not saying it was wrong or not needed, but we're all a product of our environment. For a certain amount of our able bodied youth, that turned into "hey, do I really need to work??" (+mom and dad wants me to stay home and "be safe"). Then, one of the most overlooked part of that sh*tstorm, was mass exodus by the boomers. And that impacted Main St much more than Wall. Do you know how many of those part-timers were the glue holding this ship together?? Now they're out, and for good reason, a big fat pandemic driven dose of reality: life IS too short.

I'll stop ranting there lol.

I had hoped that during this big "reset" competition and new business would eventually drive prices back down to a reasonable level. It seems that greed has toed the line and that won't be happening for a while.

While I agree with you in large part those "free checks from the government" that people are blaming on the labor shortage stopped quite come time ago. Including both stimulus checks as well as increased amounts and extensions of unemployment benefits.

Otherwise I think our thought line up pretty well on this topic.

This $#!+ is getting scary!

Yeah, I'm probably being a little hyper-analytical in that respect. But I'm not "blaming" as much as "naming"... as a contributing factor. I know more that a handful of this people, and know that they've explored other options of the free ride as we came out of this mess. And I've heard out loud how easily they justify it.

I'll put it this way: it's not a real hard sell for some people to see that working part time and receiving benefits is way easier than "the old way". Again, not screaming bloody murder, just pointing out one of the straws on the camel's back.

I can verify what you said as well. Most of the Big 5 contractors nowadays are integrators, because it's a better return on investment capital if you basically assemble the planes/weapons vs build them from the ground up. Lockheed, Boeing et al only account for around 30-35% of the direct costs for the weapon systems they produce, with the rest coming from suppliers and subcontractors. Those suppliers can also be Big 5 integrators as well whose own product is comprised mostly of supplier/subcontract costs. Add into all that, most of the companies are sole source - we have no other alternative contractors to buy these products.

Anyhow, it was VERY common for Lockheed, Boeing et al to scream "COVID!" for both their stuff and their supplier costs increasing. When you drill down to the supplier to ask them "WTF?" they go "COVID!" and then when you drill down to the second tier supplier, you know the response, and so on and so forth.

Well, lo and behold, if you check the Producer Price Index data that covered the height of the COVID years, defense contractors were largely unaffected by COVID/inflation. Most of that was due to the safeguards that were put in place by the Government. Akin to the handouts that you mentioned. These weren't handouts per se, but it was things like increased cash flow and financing. Huge to a public company's bottom line and incentive metrics. So, basically, they were unaffected, but still got to drive their costs up by taking the opportunistic flavor of the month and shouting "COVID!" So they essentially had their cake and ate it too.

Now in current acquisitions, they are pressed to get escalation over previous contract agreements, despite the fact that the margin is oftentimes wholly unfair. Heaven forbid the price actually drop on something. So the gouge is perpetuated. But again, they are sole source, so they put their fingers in their ear and stomp on the ground until they get what they want.

#Greed

Another aspect of the job market I really hadn't considered since I am of the age of no longer having children at home is the high cost of and lack of accessible child care. However I saw an article that made some sense to me about lower wage women and even educated women leaving the work force because the cost and access of childcare was so high and hard to come by that it made working somewhat of a futile endeavour especially in two income households.


The First Five Things to Know: Impact of the Child Care Crisis on Women & Mothers

https://www.ffyf.org/resources/2023...-the-child-care-crisis-on-women-mothers/

https://abcnews.go.com/US/wireStory/1-4-us-adults-age-50-expect-retire-109580378

1 in 4 older adults expect to never retire.

That’s 25%. Not a big deal. Also lots of older people work to stay active. And expectations change.

My dad was one such person. He worked until he was 80, somewhat because of me, his oops baby, but also because it was his own business and it was hard for him to give it up. Having that business basically laid the foundation for my whole family to succeed. Retired at 80. Dead just before 81. Depending on what people's passions are, I don't think his story is out of the ordinary.

Same here with our family. My father worked well into his 80’s and died at 94.

I remember being in my late twenties, early 30's trying to account for the $1,200/month daycare costs. I can't even imagine what it's up to nowadays. I have to think if I owned a large enough business, I would try to entice talent by looking to open up on-site daycare, if feasible. Being at the vanguard of the millennial generation myself, I think Gen Y and Gen Z would consider that a pretty meaningful perk in today's workplace.

Just hypothetical brainstorming on my part, though.

I remember being about 10 and knowing my step mom was paying a whole $1 an hour for the babysitter to watch three of us.

It's insane now. My BIL pays a small fortune for two grade-school-aged kids.

I can't imagine. I think it'll end up in one of two scenarios. One, there will be a move back to single-income households because the cost/benefit analysis of having two working parents won't be there. That could cause a major drop in spending with resulting economic impacts. Two, it'll drop the birth rate even further, which could also have resulting economic impacts.

It's not unusual for family to take care of children while the parents work. Such as the grandparents, etc.

I see that, too. That's one thing I missed, and a bunch of other people I bet miss too when they move to another place.

The disadvantage of my location is that I don't have family close by. However, the advantage of my location is that I don't have family close by.

I do imagine if people work more and more into retirement age that the dynamic of grandparents being able to take care of grandchildren may dissipate some. I do know that my wife already threw out to my kids that if they lived close, she would offer to do that for them. That's way down the road, though.

And that's the how things have become and continue to become. My daughter and son in law moved here to the Nashville area for far better job opportunities and it paid off very well for them. My parents had both passed years earlier so since all my grandkids were moving here my wife an I relocated here as well.

But that isn't how it works for most families. It's crazy to hear the same people say, "Well if you can't find a good job, move the where the jobs are" on one hand and then say, "Let your family help you with childcare" on the other hand.

Then there's the fact that many people simply feel that since their families have their own life it wouldn't be fair to intrude by imposing on them to help raise your children.

https://www.linkedin.com/news/story/job-openings-lowest-since-2021-5916513/

Job openings lowest since 2021
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By Cate Chapman, Editor at LinkedIn News
Updated 1 hour ago


Job openings fell to the lowest in three years during March, while the rate at which Americans voluntarily left their jobs dropped to a 4-year low. Available openings declined to 8.49 million, from a revised 8.81 million in February, according to the Labor Department’s Job Openings and Labor Turnover Survey. The hiring rate across industries, 3.5%, is also the slowest since the pandemic hit in 2020. The signs point to a softer labor market, something the Federal Reserve has sought while holding interest rates at a 23-year high to slow inflation.

A separate report from ADP showed that while companies stepped up hiring in April, wage growth for those switching jobs fell nearly a percentage point.
The U.S. jobs report Friday is expected to show a gain of 240,000 farm and nonfarm payrolls last month, slower than March’s blowout 303,000.

https://www.linkedin.com/news/story/fed-seen-holding-rates-steady-5907441/

Fed seen holding rates steady
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By Cate Chapman, Editor at LinkedIn News
Updated 2 hours ago


The Federal Reserve, while widely expected to leave borrowing costs on hold Wednesday, is likely to concede that officials “have less conviction about when and how much to reduce interest rates,” The Wall Street Journal reported. No new projections are scheduled, but Fed Chair Jerome Powell may take the opportunity to revisit projections made in March for at least two rate cuts this year. Those prospects appear to have diminished in light of faster-than-expected inflation and wage growth, raising the likelihood that rates will remain at a 23-year high for longer.

It seems as though there is less and less of a labor shortage which everyone was complaining about. Millions of jobs have been created and it appears most of them have been filled since there are so many less job openings. That sounds like a job well done and that the falsehood that "people don't want to work" has now been debunked.

Private payrolls increased by 192,000 in April, more than expected for resilient labor market

Job gains were strongest in leisure and hospitality, which posted an increase of 56,000.

https://www.nbclosangeles.com/news/...or-resilient-labor-market/3401703/?amp=1

You don't understand. It's all the lazy illegal immigrants taking all our jobs

https://www.reuters.com/markets/rat...ion-dims-hopes-policy-easing-2024-05-01/

Fed leaves rates unchanged, flags 'lack of further progress' on inflation

WASHINGTON, May 1 (Reuters) - The U.S. Federal Reserve held interest rates steady on Wednesday and signaled it is still leaning towards eventual reductions in borrowing costs, but put a red flag on recent disappointing inflation readings that could make those rate cuts a while in coming.
Indeed, Fed Chair Jerome Powell said that after starting 2024 with three months of faster-than-expected price increases, it "will take longer than previously expected" for policymakers to become comfortable that inflation will resume the decline towards 2% that had cheered them through much of last year.

That steady progress has stalled for now, and while Powell said rate increases remained unlikely, he set the stage for a potentially extended hold of the benchmark policy rate in the 5.25%-5.50% range that has been in place since July.
U.S. central bankers still believe the current policy rate is putting enough pressure on economic activity to bring inflation under control, Powell said, and they would be content to wait as long as needed for that to become apparent - even if inflation is simply "moving sideways" in the meantime.

The Fed's preferred inflation measure - the personal consumption expenditures price index - increased at a 2.7% annual rate in March, an acceleration from the prior month.
"Inflation is still too high," Powell said in a press conference after the end of the Federal Open Market Committee's two-day policy meeting. "Further progress in bringing it down is not assured and the path forward is uncertain."

Powell said his forecast remained for inflation to fall over the course of the year, but that "my confidence in that is lower than it was."
Whether there are rate cuts this year or not remains in doubt.
"If we did have a path where inflation proves more persistent than expected, and where the labor market remains strong but inflation is moving sideways and we're not gaining greater confidence, well, that would be a case in which it could be appropriate to hold off on rate cuts," Powell said. "There are paths to not cutting and there are paths to cutting. It's really going to depend on the data."

Despite the uncertainty of the current economic moment, Powell's characterization of rate hikes as "unlikely" cheered investors concerned about a newly hawkish Fed chief.
U.S. stock and bond prices turned higher as Powell preached patience that may delay rate cuts, but also means a high bar for any more hikes. The Fed raised its benchmark policy rate by 5.25 percentage points in 2022 and 2023 to curb a surge in inflation.
Powell's remarks on Wednesday were "notably less hawkish than many feared," said analysts at Evercore ISI. "The basic message was that cuts have been delayed, not derailed."
Investors in contracts tied to the Fed's policy rate increased bets that rate cuts could begin in September rather than later in the year as reflected in earlier market pricing.
BALANCE SHEET
The Fed's latest policy statement kept key elements of its economic assessment and policy guidance intact, noting that "inflation has eased" over the past year, and framing its discussion of interest rates around the conditions under which borrowing costs can be lowered.
"The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably towards 2%," the Fed repeated in its unanimously-approved statement.
That continues to leave the timing of any rate cut in doubt, and Fed officials made emphatic their concern that the first months of 2024 have done little to help the cause.
"In recent months, there has been a lack of further progress towards the Committee's 2% inflation objective," the Fed said in its statement.

The U.S. central bank also announced it will scale back the pace at which it is shrinking its balance sheet starting on June 1, allowing only $25 billion in Treasury bonds to run off each month versus the current $60 billion. Mortgage-backed securities will continue to run off by up to $35 billion monthly.
The step is meant to ensure the financial system does not run short of reserves, as happened in 2019 during the Fed's last round of "quantitative tightening."
While the move could loosen financial conditions at the margin at a time when the U.S. central bank is trying to keep pressure on the economy, policymakers insist their balance sheet and interest rate tools serve different ends.
The Fed maintained its overall assessment of economic growth, saying that the economy "continued to expand at a solid pace. Job gains have remained strong and the unemployment rate has remained low."
Powell reconciled that with the relatively weak, 1.6% growth of gross domestic product in the first quarter by saying that the 3.1% increase in private domestic demand was a better gauge of where the economy stands, with output buttressed by a recent jump in immigration.
Asked about the risk the U.S. was entering a period of "stagflation" with stagnant growth and rising prices, Powell said current conditions are nothing like those seen in the late 1970s when prices were rising more than 10% annually at one point alongside high unemployment.
"Right now we have ... pretty solid growth ... We have inflation running under 3%," Powell said. "I don't see the 'stag' and I don't see the 'flation.'"

If you’re carrying a lot of high-interest debt, the fact that the Federal Reserve once again did not cut interest rates at its Wednesday meeting may be disappointing, if not surprising.

But if you have any savings, the Fed’s unwillingness to lower rates until it sees more consistent progress in inflation data has – and will continue to – put money in your pocket this year if you seek out federally insured accounts with the highest rates.

In 2023, savers made $315.4 billion in interest in deposit accounts, four times the $78.7 billion they earned in 2022, according to Lending Tree’s DepositAccounts.com, which used data from the Federal Deposit Insurance Corporation in its calculations.

That’s because, after so many years of paltry interest rates, the Fed’s rate-hike campaign that began in 2022 made it possible for savers to earn inflation-beating yields on their US domestic deposits, including bank and credit union savings accounts, certificates of deposit and money market accounts.

At the same time, yields on Treasury bills have also been very competitive with the higher rates banks are offering and are equally low risk.

https://www.dailymail.co.uk/news/ar...ital-gains-tax-rates-joe-biden-plan.html

Biden wants to pass a HUGE capital gains tax hike. Some states will have over 50% tax rates

Vote this fool out of office.

Joe going after that fair share!

You mean everybodies share. People rely on their 401ks for retirement. Joe wants to steal everybodies retirement money.

So how much would that tax rate be for "average people"? It's certainly not the figure you were suggesting................

Biden Calls for Doubling Capital Gains Tax

President Biden wants to increase the capital gains tax rate and have the wealthy pay a “fairer” share.

President Biden’s $7.3 trillion FY 2025 budget released last month, proposes several tax changes aimed at wealthier taxpayers, including a minimum tax on billionaires, a near doubling of the capital gains tax rate, and an increased Medicare tax rate.

This budget proposal comes as the IRS says it has recently collected (through ramped-up enforcement) more than $500 million in unpaid taxes from delinquent millionaires and "wealthy tax cheats."

The White House says the President's budget, which also contains several tax breaks for those with lower and middle incomes, including new homebuyer tax credits, would reduce deficits by nearly $3 trillion over ten years.

Biden capital gains tax increase

The capital gains tax rate for long-term capital gains, assets held for more than one year, is at most 20%. Capital gains are the profits you make from selling or trading an asset. The tax rates that apply to a particular capital gain (i.e., capital gains tax rates) depend on the type of asset involved, your taxable income, and how long you held the property before it was sold.

Biden’s FY25 budget proposal would nearly double that capital gains tax rate to 39.6%. That proposed capital gains rate increase would apply to investors who make at least one million dollars a year.
44.6% capital gains proposal?

You may have heard about a proposed 44.6% capital gains rate in a budget footnote. That rate is a separate proposal that if ever approved, would apply only to those with high net investment and taxable income.

The rate supposes an increase of the net investment income tax rate to 5% above the $400,000 threshold with an increased top ordinary rate of 39.6%.
'Carried interest loophole'

The Biden budget proposal also revives the debate over the so-called carried interest loophole. Currently, asset managers can treat certain compensation they receive as capital gains, which means that a significant portion of their income is taxed at a much lower rate than if it were treated as wages.

Under Biden’s budget proposal, that compensation would be treated as ordinary income for federal income tax purposes to end the carried interest loophole.
Medicare tax

President Biden is proposing a tax increase for people making more than $400,000 a year to help shore up the Medicare program. That income threshold would be based on wages, salary, and capital gains.

Biden's FY25 budget proposes to increase the Medicare tax rate to 5% from the current 3.8%.

According to federal data, more than 60 million people use Medicare, which provides health insurance for people over age 65.
The number of people using Medicare is expected to grow, which has caused concern over the long-term viability of Medicare and other programs like Social Security.

The White House says that this tax increase would extend the life of the Medicare Trust Fund by at least 25 years, without cutting benefits. However, like the capital gains tax proposal, the Medicare tax rate increase is not likely to find enough support to pass this year, given Congressional divides and the upcoming election.
Income tax rate

President Biden wants to increase the top income tax rate for wealthier taxpayers.

Under Biden’s budget proposal, taxpayers making $400,000 would be taxed at a top rate of 39.6%.
The current top tax rate, tied to inflation-adjusted tax brackets, is 37%.
The proposed tax rate change would reverse the so-called Trump tax cuts in the Tax Cuts and Jobs Act.

Note: The Biden budget is merely a proposal that given the state of play on the Hill is not likely to gain Congressional support to pass this year. So, the seven tax rates you are familiar with i.e., 10%, 12%, 22%, 24%, 32%, 35%, and 37%, apply. (The income tax brackets associated with those rates are adjusted yearly for inflation.)
Biden budget tax increase for billionaires

President Biden also wants to impose a minimum tax on billionaires. Some of the rationale behind this “wealth tax” is that wealthier taxpayers are often able to shield a good portion of their income from tax. That’s partly because the wealthy usually grow their wealth through investments, which are taxed at lower rates than earned income. Earned income (which includes wages and salaries) is typically the main source of money for taxpayers with lower and middle incomes.

The billionaire tax in Biden’s budget proposal would be a minimum of 25% for households with net worth exceeding $100 million.
For comparison, according to the White House, the wealthiest taxpayers in the United States reportedly pay an average 8.2% tax rate.

Capital gains taxes on real estate: 1031 like-kind exchanges

Biden's FY25 budget would also close what the administration calls the “like-kind exchange” loophole. Under current 1031 like-kind exchange rules, real estate investors can defer paying tax on gains from certain real estate deals as they keep investing (reinvesting the proceeds) in that real estate.

The White House says "this amounts to an indefinite interest-free loan from the government," and that "real estate is the only asset that gets this sweetheart deal."

https://www.kiplinger.com/taxes/biden-calls-for-doubling-capital-gains-tax-rate

So all it really does is restore the tax rate back to where it was before trump's tax cut.

They can't retire! Who will pay for all the terrorists' college loans??

The new Biden 44.6% Cap Gain increase will pay for the terrorist's indoctrination. Vote this fool out of office.

It will help support the "Stand back and stand by" indoctrination as well.

Eve, I know you may struggle with facts, but a responsible POTUS, trying to offset spending USED to be something GOPers looked for…

Biden announces $3.3 billion AI investment by Microsoft at scaled-back Foxconn site Trump once touted


Biden announces $3.3 billion AI investment by Microsoft at scaled-back Foxconn site Trump once touted
A planned $10 billion facility for electronics manufacturer Foxconn in Wisconsin never fully materialized.




May 8, 2024, 9:51 AM EDT / Updated May 8, 2024, 2:05 PM EDT
By Summer Concepcion
President Joe Biden traveled Wednesday to Wisconsin to announce a $3.3 billion investment by Microsoft to build an artificial intelligence data center.

The data center will be built on the property of a planned $10 billion Foxconn facility that Donald Trump touted during his presidency as a major revival of tech manufacturing in the U.S.

But those plans never fully materialized. Foxconn, based in Taiwan, later drastically scaled back plans for the factory, which Trump once called “the eighth wonder of the world,” reducing the number of new jobs from 13,000 to the roughly 1,000 spots that are filled now, the Milwaukee Journal Sentinel reported.

In remarks Wednesday at Gateway Technical College in Sturtevant, in Racine County, Biden took aim at Trump multiple times for his "failed promises" about Foxconn, although he didn't mention his predecessor by name.

Biden said the failed Foxconn project during Trump's presidency left Wisconsin residents and workers behind, adding that it led to the bulldozing of 100 homes and farms and wasted hundreds of millions of taxpayer dollars.

“They dug a hole with those golden shovels, and then they fell into it," Biden said.

"Foxconn turned out to be just that — a con. Go figure," he added.


Biden touted his administration’s "investing in America" agenda, which includes commitments to rebuild roads and bridges, developments in clean energy and creating $866 billion in private-sector investment nationwide as part of efforts to revitalize American manufacturing.

Biden hailed Microsoft’s investment in the AI data center as a “transformative” investment in infrastructure, especially for the people of Racine, who he said will have the opportunity to get training for new high-paying jobs that don’t require four-year college degrees.

“During the previous administration, my predecessor made promises which he broke more than kept, left a lot of people behind in communities like Racine,” he said. “On my watch, we make promises and we keep promises, and we leave no one behind.”



Microsoft’s investment in the AI data center is expected to employ 2,300 union construction workers and create 2,000 permanent jobs over time, the White House said, adding that nearly 4,000 jobs have been added in Racine, a third of them in manufacturing, and 177,000 in Wisconsin since Biden took office.

Microsoft also plans to partner with Gateway Technical College in Wisconsin to develop a training facility to prepare 1,000 residents for data center jobs and roles in science, technology, engineering and math by 2030, with the aim of employing up to 2,000 people in permanent roles at its Racine facility, the White House said. It will also invest in training 1,000 business leaders to adopt AI in their operations.

The Trump campaign didn’t immediately respond to a request for comment.

Trump has repeatedly claimed that the economy during Biden’s presidency has been worse compared with his time in office, often pointing to rising inflation and interest rates in recent months.

Biden and administration officials have recently traveled to key battleground states to highlight his economic record, such as legislation investing in infrastructure and clean energy, which Biden has said leads to the creation of more well-paid jobs based in the U.S.

https://www.nbcnews.com/politics/wh...microsoft-scaled-back-foxconn-rcna151209

Rememeber that time that the Trump Team made claims that US Steel was building 6 new plants?

Trump’s economy was a disaster. The effects are still costing US. The only thing he got done was operation warp speed.

Not really. Inflation was 1.4% and the DOW was soaring. Biden trashed America in a multitude of ways and people will be voting with their wallets in Nov.

I just know my account went down about $110,000 last month, so it can't be doing all that well.

The percentage isn't all that much, but still, it's a good deal of money. When are the simpletons going to quit pretending?

Where is your account on the year?
What about after the last week?


Not asking you to share your finances.
Point is that the market fluctuates and you can always find some time frame that is good or bad

One day I lost $3k
The next 2 days made $2k each
Total for 3 days up $1k

But I can say the market isn't doing well because I lost $1000 in one day

Murica be voting with their wallets lol. By voting for a tax cheat.

Inflation wha wha! Trump caused this inflation and it would have been much worse if not for Biden’s administration. But the truth twisting Trumpian propaganda machine won’t let that get any oxygen because defeat rests in the truth… Biden is the Truth.

No tech stocks? And big oil is about to take a hit… just a heads up.

And I have read at least 4 different stories in the past week where companies are starting to lower prices. Walmart, Aldi are lowering prices on hundreds of items...McDonalds are putting together a burger and fries combo and dropping prices back to 5 bucks. Car companies are now coming back with zero down and not adding cost to the sticker.

Why, it isn't trump or Biden..It is market forces, they raised prices too high for too long and people aren't scooping up cars, inventory is up at Wally world. Mcdonalds said that they are losing their low income customer base because they can't come in for a mcdouble, fries and drink for 13 bucks so they are reducing prices. Its market forces that will drop prices back down. We don't consume, they will drop prices.

Did you check again yesterday, cause it seemed to come back nicely.

I have made more money in my 401k in the last 18-24 months than at any other time since I started doing this about 30 years ago

Has trump ever gone to a rally and told any plan for reducing inflation, taking care of child care for single moms, tackling student loan debt, health care.

No, he tells a bunch of bs lies that he knows more than anyone else and he will fix everything. although he already had a chance and didn't fix nothing.

I guess he doesn't know more about real estate valuation and taxation than anyone else, cause the IRS is coming.

And now he is going to the oil and gas companies for 1 billion to help with his re-election and lawyer bills, and if he gets in, they will make it back in spades. First of all, what does that mean for us, cause we are the ones that will be paying that back, not his ass. And, there is no way that any politician should be going to any sector asking for his kind of money. It should be illegal.

Fair enough.

I am lucky I have enough to take the up's and downs. I might make it back next month.

I wonder about the person who isn't as fortunate. Not long ago you could go to McDonalds and get a decent meal for $5 or so. Now it is double that....or nearly. I go to the grocery store several times a week. You do that when retired. I now walk out with 2-3 bags of things and it run over $60 for 2 meals.

I wonder how that minimum wage push has actually helped people? I do know the answer, it never helps them after 5-6 months..

So does that mean you're trying to blame inflation on the fact wages have risen? You haven't been able to buy an adult sized "meal" for $5 at McDonald's in a very long time. I'm not trying to say their prices haven't gone up because they have. But to try and cliam that $5 meal statement isn't an exaggeration would be dishonest. Maybe your idea of "not long ago" is different than mine.

I think where I'm still confused is the data point that was previously discussed where consumer spending went down, but inflation still went up. I'm no economist, but that kind of shows a decoupling of supply and demand. I don't know what other cause there could be, aside from gouging.

Perhaps it's a gap in time between the time period where consumers say "I'm not going to spend anymore" and corporations suddenly realizing that demand is down, causing them to recalibrate pricing, like what Lima said. That should ultimately result is at least noted disinflation, though. If consumer spending drops again, but inflation still continues to rise from here on out, then there could be real issues afoot.

I think most that watch know there's already issues afoot in terms of price gouging. But I would certainly agree we don't know the full extent of it or how deeply the issue runs.

Proves the corporate greed and price gouging I complained about all along. Biden didn’t and isn’t causing this, corporate boardrooms did.

As the fellow said when coach Norman dale told him he was done coaching, “mister, there are two kinds of dumb”. And one of them is saying the Trump economy was a “disaster “ without any elaboration. The Trump economy was roaring, the bottom 25% of wage earners received their first increase in real wages in two decades, about 30% I believe. Unemployment in most minority groups was down. Profits were up. Everything was going just fine. Then the Chicomms dumped the virus on the world, and everything went to hell.

I do not remember the interviewer but when the guest said how horrible the economy was they inherited from Trump, she actually pushed back with , well we were in the middle of a pandemic. Perfectly true.

All you have to do is ask people, are you economically better today than you were four years ago. They will tell you, but you lefties just won’t listen.

I'm better now than I was 4 years ago. I was also better 4 years ago than I was 8 years ago, and so on and so forth, spanning multiple presidencies.

I don't necessarily think that correlation is always akin to causation, though, and I think that seems to be the major pitfall of people - both right and left.

For example, let me ask you, who do you think was responsible for the 2008 financial crisis?

So the inflation we have endured the past 3.5 years is the result of corporate greed and price gouging eh. Right!! You lefties can come up with such simplistic drivel. But to buy what you are selling one must believe that in 2021 there was a takeover in the corporate boardrooms all across America. Leadership was assumed by executives intent on gouging and greedying there way to success. Because in the decade from 2010 to 2020 the average inflation rate, aka corporate gouge rate, aka corporate greed index, was 1.75%. Hmm. 1.75%. Whodathunk those greedy corporatists would have kept inflation, aka gouge rate so low.

So either the corporate leadership changed dramatically or it really is the Biden inflation. Newsflash I would bet corporate leadership did not change much at all.

Dawglover, glad you are doing better. I am a retiree and I can tell you my income has not come close to keeping up with the 2021-2023 inflation. Most things we buy in the grocery are up 25-30%, gas is up 75% and so in. I do not think most folks have seen pay increases the past 3.5 years to equal inflation. Most polls show people feel worse off than in 2020 , minus the virus of course.

That question is not a simple one and I have to admit I have no desire to go back and review the origins of that situation. What little I remember it seems to have its roots ina law passed, maybe called the community redevelopment act, but I am not certain of that. It encouraged/put pressure on/required banks to begin giving loans they previously would not have given. It seems like they lowered the financial situation of an applicant for a home loan to minimum. For example my first house I had to put down a 20% down payment. In order to get loans to people they eliminated or dramatically reduced that requirement.

I guess a simple answer is they began giving loans to people who really could not afford them, with little skin in the game required of them. When housing prices dipped these people became “upside dow” and many just walked away sticking the banks with those properties. Banks then bundled those high risk loans and sold them off. Everything just went in the crapper from there.

I am not really doing justice to that explanation but that is about all I have for now.

Thanks Keith. Appreciate the good will. Hope things get better for you as well.

I don't mean for you to have to explore the issue of the 2008 crisis as a whole, but what I was getting at on that front is that there are ripple effects that begin with one administration or Congress that have wave effects over the course of time, that are not fully felt until everything comes to a head. As an example, I would agree that the law you referenced was a catalyst for the financial crisis. That was during the Clinton administration, eight years before the actual crisis hit. Bush was in place at the time, but I do not put the blame squarely on his shoulders, if you get my drift. The bottom line is that there needs to be causation, not correlation.

Now, if you look at the current scenario, others have argued - with merit IMO - that the insanely low interest rates that existed during the 2010's combined with the bottoming of those rates during COVID set the groundwork for the inflationary practices. I also think that the over-issuance of stimulus money found during both the Trump and the Biden administration at its onset contributed to an uncanny hike in demand. Add in the supply chain/inventory issues that came along with COVID, and you have yourself in a stagflationary environment. It was really the perfect storm, initially.

Butting into the conversation you are having with OCD, though, I think that corporations were big fans of that low interest rate. It was almost like free money to them given the returns they were seeing by taking out loans with that interest rate. I think that was another cause for overheating. I also think its readily apparent that gouging did take place on the corporate front. I know I saw it first hand with the defense industry, which I griped about earlier in this thread. COVID was an opportune time for mega corps to shout "SUPPLY CHAIN! COVID! INFLATION! PANDEMIC!" as the rationale behind their price hikes. What we found out on the defense front is that the companies weren't nearly feeling the pain they were asserting, given all the relief avenues they had experienced from the Government. Basically, corporations get welfare, too. Now that the pandemic has passed, you still see hyper-inflation and supply chain issues commonly referred to in companies SEC filings while they are also still making record profits, which doesn't totally add up.

That turns back to the finding that I discussed earlier. Which is...what other explanation besides gouging could there be for inflation continuing to rise when consumer spending has cooled? Prices still go up even though demand drops? In fairness, it could be a lag in response that I mentioned earlier, but we have seen gouging happen already, like what Pit mentioned. If that data continues to progress where consumer demand levels off or decreases, but prices increase, that's a pretty tell-tale sign. I do worry in our current era of constant mergers and acquisitions that the lax anti-trust enforcement we've had is coming to a head, both on price gouging and quality (See Boeing, et al).

Put it at whatever amount you like. It is much higher. I did note you didn't disagree with my point other than disagree with the dollar amount I used as an example. Typical.

I think you liberals are either in denial or stupid.


I will amend an earlier comment to include naive.

Typical. Go after money you don't have.

Envy is the word.

Didn't disagree with you? You put out a post that didn't say anything so I was looking for you to clarify what you were saying. Dear Lord.

So the little man making a decent wage is keeping you down.

Let me explain what fits all of those words. Trying to claim that what happens now in the economy is because of who is president now. 05 tried to explain that to those either in denial, stupid or naive. Economic results happen over time. Policies take time to impact the economy. The results we see today are not caused strictly on the polices of the past few years. Somehow I thought you were a fairly smart man. So let me ask you, how long did it take policy on home loans to burst the housing bubble? Were those policies enacted by Bush? Did you blame Bush for the housing market bubble bursting?

But then I forget you're one of those people that think if you like the pockets of billionaires with huge tax cuts somehow they will hire more people and it will create jobs. When the fact is the only time they create jobs is when demand dictates they need to. Which actually means the best way to create jobs is to put that money in the hands of people who need to buy things. The everyday taxpayer who makes up the bulk of consumers.

So that does help me understand why you want to blame Biden for policies that came along well before he was president.

You mean getting back some of the tax cuts Republicans have given billionaire corporations over and over and over again? So you're all for the great billionaire tax give away and think expecting them to pay their fair share is wrong. Heaven help us if they pay the same tax percentage as their workers.

Trump touted low-wage worker pay gains but much of the credit goes to state minimum wage hikes

https://www.usatoday.com/story/mone...r-boom-due-higher-pay-floors/4682939002/

https://www.cnbc.com/2024/05/14/ppi...percent-in-april-more-than-expected.html

The producer price index, a measure of what producers receive for the goods they produce, increased 0.5% in April and was up 2.2% on a 12-month basis, the biggest gain in a year.

The core PPI also rose 0.5% compared with the 0.2% Dow Jones estimate.

Services prices boosted the wholesale inflation reading, climbing 0.6% and accounting for about three-quarters of the headline gain.

Wholesale prices jumped more than expected in April, putting up another potential roadblock to interest rate cuts anytime soon.

The producer price index, a gauge of prices received at the wholesale level, increased 0.5% for the month, higher than the 0.3% Dow Jones estimate, the Labor Department’s Bureau of Labor Statistics reported Tuesday. However, the March reading was revised from an initially reported 0.2% gain to a decline of 0.1%.

Stripping out volatile food and energy prices, the core PPI also rose 0.5% compared with the 0.2% Dow Jones estimate. Excluding trade services from that core group showed a 0.4% increase on the month and 3.1% on a 12-month basis, the highest level since April 2023.

On a year-over-year basis, wholesale inflation rose 2.2%, also the highest in a year. The core PPI inflation was at 2.4%, the biggest annual move since August 2023. Both numbers were in line with estimates from Reuters.

Stock market futures were around breakeven following the data while Treasury yields were mixed.

“Sticky inflation looked downright stuck this morning after a much hotter-than-expected inflation reading. But with last month’s numbers revised lower, this report may not have been as much of an upside shock as it first appeared to be,” said Chris Larkin, managing director of trading and investing for E-Trade from Morgan Stanley.

Services prices boosted the wholesale inflation reading, rising 0.6% and accounting for about three-quarters of the headline gain, while the final demand goods index increased 0.4%. The services increase was the biggest monthly gain since July 2023, the BLS reported.

Portfolio management helped drive the services costs, rising 3.9% on the month.

Goods prices as measured by the PPI rose 0.4%, reversing a 0.2% decline, led by a 2% increase in the energy index, which included a 5.4% surge in gasoline prices. The final demand index for food fell 0.7%.

The latest inflation data comes with the Federal Reserve on extended hold regarding interest rates. Policymakers have said in recent days that they expect inflation to trend lower through the year but need more evidence that it is convincingly on the way back to the central bank’s 2% goal before cutting rates.

Recent data points have not been encouraging.

The consumer price index, the companion to the PPI that measures what consumers pay rather than what producers receive, has had higher-than-expected gains through the first part of 2024, fueling fears that inflation is stickier than economists and policymakers had expected.

Similarly, the Fed’s preferred measure, the Commerce Department’s personal consumption expenditures price index, also has been running hot and showing inflation running just shy of 3%.

All of the various inflation measures are showing price pressures well ahead of the Fed’s target.

In addition, various consumer surveys have shown expectations running hot. The New York Fed’s monthly survey released Monday showed the one-year inflation outlook at 3.3%, the highest since November, pushed in good part by expectations that housing-related costs will continue to increase.

Someday you lefties will learn that corporations do not “pay” taxes. They collect them from their customers. When a business prices its product in the marketplace it does so by first determining its expenses to produce the product. It takes everything into account. Cost of capital, cost of labor, cost of energy, everything. And that includes the estimation of the taxes they will pay per unit of production. Add in their margin of profit and, voila, the cost of the good to the consumer. Cost of labor goes up, cost of the product goes up. Transportation cost go up, cost of the product goes up. Taxes the company pays goes up, so does the price. Abolish the corporate income tax annd income taxes on small businesses, all taxes people pay but they do so indirectly. Prices would drop but people would pay the same amount directly . When they saw how much they are really paying in taxes I have a feeling some real change in government would come.

Real world example of my point. I inherited two rental homes from my Mom. 25 years ago so they were paying $800 per month at each house. The community they were in passed a tax levy that resulted in my taxes on the each house going up $360 per year. I sent each a letter telling then their rent was going up $30/month and why. There is no independent pot of money that a business uses to pay taxes. It all comes from their customers.

Your point is well taken when it comes to small businesses and rentals, which is supposed to be at the backbone of what our economy was built on in a true, conservative, capitalist sense.

However, that metric completely changes and becomes more complicated when it comes to large businesses, especially public corporations. It's almost a different beast entirely, as I have really learned recently when digging through 10K, SEC filings, and looking at the history of how Jack Welch completely changed the game, for the worst IMO.

The public corporations of today are not the same as the public corporations during the Prosperous 50's. The game has changed, and it's not the taxes. It's the motivations. Now, public corporations are 100% in it for shareholder return. Spreading costs and accounting for those costs in the price of goods and services is surely an element, like what you mentioned, but you also hit on margin, which is another point where we need a deep dive. When mega corps hit margins of a certain percentage and have a windfall, that is good for the shareholders, and then there becomes an expectation that those margins perpetuate. As I see firsthand with companies like Transdigm in the defense sector, sometimes those margins are eye-poppingly exorbitant. So when something like paying additional taxes come up, you could look at it from the lens of "Great, now they will HAVE to increase the cost of their goods to maintain margin" or you could look at it from the lens of "Well, perhaps now they could - or at least should - decrease their margin to a level that is historically reasonable to account for these new taxes." That never happens, though.

In the same line of thought, mega corps also incur costs for a host of other things outside of taxes. Heck, Lockheed Martin, who almost exclusively makes its money off of tax payers, just spent $20B (yes a B, not an M) in stock buy-backs over the last five years. Who do we ultimately think is going to cover those costs? You could also go into other "expenses" too, like C-suite expenses and a CVS receipt long list of expenses that all get rolled up into a company's G&A or other expense pool that ultimately have to get incorporated into the price of goods or services sold. Things like stock dividends, for instance. The bottom line is that we sometimes want to hone in on taxes as being the sole focus for companies raising the cost of their product, but why give all those other expenses a pass?

What it really boils down to in my mind, is that we have the current era where there is no longer competition at the highest level. It seems only small, local businesses compete anymore. We used to have a whole littany of defense contractors, for instance. Now we have five big ones. What does that result in? Poorer products that are more expensive with less innovation. Competition is the only organic way to ensure companies do their best to keep prices low. In the current era, though, competition seems to be a relic of America's great rise after WW2, especially as exemplified in the post Jack Welch era of "Duty to shareholders and screw everyone else."

I say that as a conservative, too. If you believe in competition on a personal level (reward hard work and whatnot), like I do, then you need to spread that mantra to corporations. We can see how dilapidated those big businesses are getting in terms of finding their "cutting edge" too. They are not as well run as they used to be in terms of putting out a product and overtaking industry. Boeing is perhaps the most glaring example. But as long as they have the funds to fill campaign coffers and dictate to our lawmakers that they are "too big to fail," they won't be properly incentivized to control costs or work to maintain their place at the top of the food chain.

Dawglover, very thoughtful comments you posted. I read your post three times looking for something I could argue with you about but, dang, I found my self agreeing with much of what you said. Just to elaborate a bit.

The zero int rests rates are loved by companies. Wouldn’t you love them if you were a borrower. If you are a saver they are not loved so much. Those low rates suck dollars into the stock market since people cannot make money anywhere else businesses love that which is why every time a rate hike is discussed the market pulls back some. That artificially inflates the market.

Widespread expansion of the money supply results in inflation and most politicians would rather print money than make tough spending decisions. Dems are way worse at that than repubs but I do not give either party a free pass on that. I thought it was very discouraging that after the pandemic politicians refused to give back those dollars, refused to return spending to pre Covid levels. All those “emergency spending levels are now the norm.

Interesting that in my town we passed a bond issue for park modernization and expansion. $60 million. Well as politicians are wont to do they just had to spend more. A good bit more. They found the money of course. You know where. From emergency Covid spending funds. Nothing to do with Covid. And I would bet that kind of thing is happening in communities all over the country.

I think price gouging happens but I believe it is heavily directed toward government dollars as you pointed out with defense contractors. When folks are spending other peoples money , well, they just don’t watch over it as closely as a businessman who is trying to be successful. I think businesses who are dealing with people or other businesses find price gouging way more difficult and I think price gouging is not a business plan that will have much success.

Dawglover, I may have the wrong person in mind, have you confused with someone else, but I think I read a comment that you are, or used to be, a repub, but that the repubs had changed so much you no longer were one. Or maybe it was because of Trump you no longer were.

I’d be interested in having a conversation with you about that sometime.

Good talkin to you dawglover
.

Good talking to you, too, Keith. You are right that I used to be a Republican.

I divested from being a Republican, not because my views had changed, but because I realized the party was not who I thought it was. I think it was jfan on here who I was talking with at the time. Both of us had the moment back during the fiscal crisis bailouts of 2008/2009 when we realized Republicans were diverging away from what it meant to be actually conservative and it's been getting worse since.

I think before that point in time, I felt an innate need to defend them at all costs, and it's honestly been liberating to leave them behind, along with my preconceived notions. Eye opening actually.

How much have corporations cut their prices when they receive those huge tax cuts? I'll tell you. They haven't. It's a one way street. They pocket every tax cut they get and then raise prices sometimes for nothing more than to raise their profit margins. Sometimes for no reason other than that.

It seems you support this lop sided, one sided capitalist system with no checks and balances. Where they never pay their fair share and only serve to gouge consumers.

So what is trump's answer? Give them more tax cuts. Since you seem to be so good at finances, maybe you can explain to me how cutting your income, (taxes for the government), when you're spending more than you are making already, helps your finances? Because that seems to be what the party you support keeps doing. They keep cutting taxes, which is the governments income source and then complain about constantly running a deficit. At least when they aren't spending the money on what they want to.