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January 28, 2015 at 5:18 PM in reply to: ot. the life changing magic of tidying up: the Japanese art of decluttering #782400
CA renter
Participant[quote=SK in CV][quote=flu]
I think the bloomberg editorial summed it up pretty well….
Why target a tax benefit that goes to a lot of your supporters (and donors), that tickles one of the sweetest spots in American politics (subsidizing higher education), and that will hit a lot of people who make less than the $250,000 a year that has become the administration’s de facto definition of “rich”?Presumably, because you’re running out of other places to get the money.
[/quote]
Stupid, illogical conclusion. The benefit doesn’t go to a lot of supporters (or donors). It hardly goes to anyone. And those that the benefits do go to, are disproportionately not those that need it the most.
The reason to dump it obvious. It doesn’t reach a wide enough population. So the proposal is to scrap it for future benefits, (NOT for people who have already taken advantage of it.) and replace it with a program with a wider market.[/quote]
Exactly.
And it’s not because they are running out of other places to get the money…it’s because the places with the most money have the best lobbyists. That’s not a coincidence, either.
January 24, 2015 at 9:51 PM in reply to: In escrow – Overreacting to inspection/disclosure/water issues? #782331ParticipantAgreed, great move on not moving forward. The seller doesn’t sound trustworthy, so who knows what else you might have found once you moved in there. Clearly, he was taking a lot of shortcuts. Well done!
Participant[quote=moneymaker]As Suzy Orman would say DENIED! No sorry, BUY BUY BUY! You’ve got the down payment and rates are at historical lows, so if you can get the house you want where you want, then you have my blessing.P.S.-Suzy would probably want you to have 6-8 months of cash in reserve, so if you are planning on not paying PMI that would mean you can afford a 250k house, which we all know doesn’t get you much today in San Diego. Actually I don’t really know if she means 6-8 months of income or living expenses, could be a big difference.[/quote]
Should be 6-8 months of living expenses, IIRC.
Participant[quote=wallers]I am wondering who the buyers are as well. If someone here makes an above average living (for here) but still has to stretch to afford an average or less than average small home (with the last few years increase) it makes me wonder what is going on and if a price correction will be coming. Looking at incomes and housing prices it does not pencil out unless it’s all driven by outside investors. Who will come and go but when they go prices go down. From what I see it is cheaper to rent than buy now (much cheaper) so that seems off as well.[/quote]
+1
Participant[quote=Rich Toscano]Good question flu, and that may be part of the disconnect here. I am using BEA per capita personal income, which includes all sources of income, including investment income. (As it should… after all the point is to measure people’s ability to purchase).
If you want to get into the weeds, here’s the official definition:
Personal income is the income received by all persons from all sources. Personal income is the sum of net earnings by place of residence, property income, and personal current transfer receipts. Property income is rental income of persons, personal dividend income, and personal interest income. Net earnings is earnings by place of work (the sum of wages and salaries, supplements to wages and salaries, and proprietors’ income) less contributions for government social insurance, plus an adjustment to convert earnings by place of work to a place-of-residence basis. [/quote]
Thanks for posting this, Rich. Makes much more sense now. Also, I’m assuming this would include any new residents from other countries who might have substantial income from other countries? It seems as though there is so much foreign money sloshing around here.
ParticipantSo glad to hear that things have worked out for you and your family, BP! Sounds like you and your wife did what was right for yourselves.
Correct me if I’m wrong, but did you say that you’re working 12 hours/day, 7 days/week? How are you managing that, especially if you’re 63 years old?
Also glad to hear that Detroit seems to be doing better. It is just that the housing prices are going up, or is everything starting to turn around? Still getting the artsy/gentrification crowd coming in? I sure hope so!
How is your son? Did he end up moving back there to be with you guys? Is your daughter (and grandchild?) still out here?
All the best to you and your family, birmingplumb!
Participant[quote=flu]I wonder why Obama/Democrats didn’t go after the carried interest loophole that hedge funds and private equity managers enjoy…
I wonder why Obama/Democrats didn’t listen to Warren Buffett and try to propose the “Buffett Rule”, which would have been an explicit tax on the “rich”
Instead, they want to tax the 529 plan? Really?….[/quote]
Could not agree more. The fairest and most effective way to reform our tax structure would be to make everyone pay the exact same steeply progressive rates on ALL types of income.
There is no good reason for gamblers and speculators (including hedge fund managers) to have a lower tax rate than people who work for a living. This type of reform would win broad support, IMO, and be much more in line with the claim that they want “the rich” to pay their fair share.
Participant[quote=kev374]Rich, my claim is substantiated by the salaries in my industry and the rents around the South Orange County area. Rents are not that much higher at all. In 2005 I moved to Lake Forest renting a 1bd there for $1,250/mo. The current rent for that exact unit, 10 years later, is $1,345/mo., it has increased 7.6% in a decade which I hardly call substantial!
However, now I live in Costa Mesa and pay $1,220/mo. for a larger apartment with a garage and I am only blocks from Newport Beach.
You can give me your statistical data all day long, which is what Economists do, but it does not match the reality on the ground. I am giving you actual data with my specific case.
I work as a Sr. Software Engineer, been doing it since 1997, pay in my industry has not increased since 2005. I am making $2,000/yr more now compared to my 2005 pay. And I am topped out in my payscale, I see job listings paying even less than what I am making for the same experience level.
You claim pay has increased substantially, let me then send you my Resume and we will see if you can get me a job for substantially more money than my 2005 income 😉
My data is real world, on the ground. Sure, it applies only to the tech industry but let me know in which other industries has pay substantially increased in the last decade?[/quote]
It probably depends very much on where one is looking. I do have to agree that pay hasn’t gone up much at all for anybody we know; for many, it is lower today than it was in 2005.
As everybody knows, I pay close attention to what’s going on in the public sector, especially as it regards state and local employers, and they have been seeing pay freezes or cuts since ~2008; only in the past year or so have public employers started to give *very small* raises. Even then, they are often still below overall 2008 compensation levels.
Other people we know who work in tech, biotech, accounting, law, leisure and hospitality, and the building trades, etc. have not seem much of an increase (if any increase at all) since the last bubble peak. Obviously, building is up from the bottom of the recession, but not above the peak in ~2005-2006…they still aren’t anywhere near the levels they were seeing in those days. Of course, this is all anecdotal, but it’s a fairly wide swath of industries.
OTOH, rents in our area are above 2005-2006 levels, but the increases pale in comparison to what we were seeing in ~2004-2007 when rents were skyrocketing in our area.
Agree that low rates are making housing prices look more acceptable because monthly PITI payments are fairly comparable to monthly rents…but even that metric is being stretched right now, at least in our neighborhood. It made absolute sense to buy in late 2011/early 2012, especially when looking at PITI/rent ratios. Not so sure it makes sense today.
Participant[quote=AN][quote=CA renter][quote=AN]Is this a precursor to the death of RothIRA/Roth401k?[/quote]
That’s what I was thinking while reading that. Let’s hope not.
Agree that the whole point of the 529 plans is the tax savings. Not sure this is what he should be going after.[/quote]
Luckily this won’t go anywhere, since Republicans control congress. However, what happen if Democrats again control all 3 branches and pass something like this and other Roth type accounts. Would they only make it going forward or would they make it retroactive.[/quote]Probably true about this not going anywhere with Republicans controlling congress; not sure it would pass with Democrats, either. It’s a bit like talking about eliminating the mortgage interest deduction…they can talk about it so that they sound tough, but it just isn’t going to happen (IMO).
They could only do this going forward. The uproar would be huge if they tried to do this to existing accounts.
Really, why would anyone invest in a 529 plan if it passed? It’s bad enough that there is a penalty if the money isn’t used for qualifying expenses…take the tax savings away, and I doubt that anyone would invest in one of these plans.
Participant[quote=AN]Is this a precursor to the death of RothIRA/Roth401k?[/quote]
That’s what I was thinking while reading that. Let’s hope not.
Agree that the whole point of the 529 plans is the tax savings. Not sure this is what he should be going after.
Participant[quote=zk][img_assist|nid=20532|title=Exactly|desc=|link=node|align=left|width=100|height=73][/quote]
That’s a pretty good one. 🙂
January 19, 2015 at 10:15 PM in reply to: OT:Be careful what you wish for… 28% Capital Gains Tax Proposal #782177ParticipantAlso agree with your post, joec.
January 19, 2015 at 6:03 PM in reply to: OT:Be careful what you wish for… 28% Capital Gains Tax Proposal #782174Participant[quote=poorgradstudent]I believe capital gains should be taxed as regular income.[/quote]
Absolutely agree!
Participant[quote=FlyerInHi]CAr, I’m now more clear about your position.
Sounds like you want deflation because that would help people on fixed income.[/quote]
Correct.
[quote=FlyerInHi]But, in the medium term, you worry most about inflation (currency collapse).[/quote]
This is a a general concern of mine…that savers and people on fixed incomes (that’s most people in this country because it includes workers, pensioners, people on public assistance, etc.) will continue to lose purchasing power over time for as long as the Fed is pushing for higher inflation and monetary expansion (with most of that going toward speculation instead of more productive investments).
Obviously, tax and trade policies are hurting these people as well. They are being hit from all sides.
[quote=FlyerInHi]In the long term, if “our currency can survive such an event” (I’m assuming a near collapse), then we will see deflation and the Dollar will be worth more than today.
I still don’t understand how we’d eventually end up with paper Dollars worth more than today after surviving a near collapse event. In my mind, currency collapse means the Dollar is worth less and less until nobody wants it anymore.[/quote]
No, a currency collapse tends to be inflationary (even hyperinflationary), not deflationary. This is when the currency loses the most value. When I said, “if our currency can survive such an event,” I meant that if the currency can survive the inflation and the resulting collapse/deflation (IF the deflation can happen), then it might be worth more at the end. But most currencies don’t survive — their money is exchanged to a new currency worth a fraction of their old currency…and this can happen multiple times in a row. People who hold hard assets like real estate are the most likely winners, though in some cases, you will see reforms put in place that redistribute land when these collapses happen. Ultimately, there is no safe place when currencies are manipulated like this.
That is what scares me most: that so many people who did nothing to create this mess — people who tried to be as conservative and prudent as possible — will end up carrying the burden for a long, long time, possibly for generations.
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