Middle Class Dismissed

It’s back with a vengeance: Private debt

"As Washington is struggling with debt and all its political ramifications, American companies and consumers are embracing it, running up record amounts in 2013. Consumer credit, for instance, surged past the $3 trillion mark in the second quarter of 2013 and continues on an upward trajectory, according to the most recent numbers from the Federal Reserve. At $3.04 trillion, the total is up 22 percent over the past three years. Student loans are up a whopping 61 percent. Total household debt, according to the Fed's flow of funds report, is at $13 trillion, nearly back to its pre-crisis level in 2007 and a shade below government debt of $15 trillion." Continue reading →

Continue ReadingIt’s back with a vengeance: Private debt

David Stockman Explains The Keynesian State-Wreck Ahead

"'What has been growing is the wealth of the rich, the remit of the state, the girth of Wall Street, the debt burden of the people, the prosperity of the beltway and the sway of the three great branches of government - that is, the warfare state, the welfare state and the central bank... What is flailing is the vast expanse of the Main Street economy where the great majority have experienced stagnant living standards, rising job insecurity, failure to accumulate material savings, rapidly approach old age and the certainty of a Hobbesian future where, inexorably, taxes will rise and social benefits will be cut...' He calls this condition 'Sundown in America'." Continue reading →

Continue ReadingDavid Stockman Explains The Keynesian State-Wreck Ahead

IMF Discusses A Super Tax Of 10% On All Savings In Eurozone

"One of the latest reports from the IMF discusses a super taxation of 10% on savings in the Eurozone. That would solve the debt problem in most sovereign countries. It would be an alternative of higher taxes or spending cuts. The economists who wrote the paper hasten to say that it is a theoretical proposal. Still, it appears to be 'an efficient solution' for the debt problem. For a group of 15 European countries such a measure would bring the debt ratio to 'acceptable' levels, i.e. comparable to levels before the 2008 crisis. One of the graphs (page 14) is also noteworthy: 'Relative to previous projections, fiscal deficits are somewhat larger in most countries, reflecting a weaker economic environment.'" Continue reading →

Continue ReadingIMF Discusses A Super Tax Of 10% On All Savings In Eurozone

Families hoard cash 5 yrs after crisis

"An Associated Press analysis of households in the 10 biggest economies shows that families continue to spend cautiously and have pulled hundreds of billions of dollars out of stocks, cut borrowing for the first time in decades and poured money into savings and bonds that offer puny interest payments, often too low to keep up with inflation. A flight to safety on such a global scale is unprecedented since the end of World War II. The growth of cash is remarkable because millions more were unemployed, wages grew slowly and people diverted billions to pay down their debts. They also poured money into bank accounts knowing they would earn little interest on their deposits." Continue reading →

Continue ReadingFamilies hoard cash 5 yrs after crisis

QE3 is a Huge Subsidy to the Top 10%.

"The Federal Reserve System’s policy known widely as QE3 is a massive subsidy of the rich at the expense of the middle class. This is the conclusion of Stephen Roach, who for years was chief economist for Morgan Stanley. He calls this policy destabilizing. He says this: the FED 'is courting an increasingly treacherous endgame at home and abroad.' The FED’s creation of $85 billion of counterfeit money — euphemistically called 'liquidity' — is based on a theory. The theory is that rich people, who buy most of the stocks and bonds, will feel wealthier, and therefore will buy more stocks and bonds. In short, QE3 is an indirect way to goose the equity markets." Continue reading →

Continue ReadingQE3 is a Huge Subsidy to the Top 10%.

Home Depot Sending 20,000 Part-Timers to Health Exchanges

"Home Depot Inc. (HD), the world’s largest home improvement retailer, plans to end medical coverage for about 20,000 part-time employees and direct them to government-sponsored exchanges scheduled to open next month as companies revamp benefits to fit the U.S. Affordable Care Act. Employees with fewer than 30 hours a week will no longer be offered limited liability medical coverage, Stephen Holmes, a spokesman, said today by telephone. About 5 percent of Atlanta-based Home Depot’s 340,000 employees are enrolled in that plan. United Parcel Service Inc. (UPS), Trader Joe’s Co. and other employers have been cutting benefits ahead of next month’s roll-out." Continue reading →

Continue ReadingHome Depot Sending 20,000 Part-Timers to Health Exchanges

IRS Seizes Small Store’s Bank Account. It’s Asset Forfeiture. It’s Legal.

"This man runs a small store. His insurance company insures against theft for only $10,000 per robbery. So, his daughter waited until there was $9,000. Then she deposited the money in the bank. An IRS agent seized the money. She charged 'structuring.' The IRS requires you to report cash deposits in excess of $10,000. It also prohibits 'structuring' — deposits just under $10,000. 'How will I pay my workers?' he said. 'I don’t care,' she replied. She handed him her card. The Internet may give the story enough coverage to convince the IRS agent’s superior that the bad publicity isn’t worth $35,000. Otherwise, this man is out of business." Continue reading →

Continue ReadingIRS Seizes Small Store’s Bank Account. It’s Asset Forfeiture. It’s Legal.

Feds Steal $35K From Small Grocer’s Bank Account Despite ‘No Violations’

"Schott's Market, in Fraser, Michigan, was robbed in January of this year. Unfortunately for Terry Dehko and his daughter, Sandy, who own the place, the thieves are government agents in the emply of the Internal Revenue Service. The IRS doesn't even allege that the Dehkos committed a crime to justify cleaning out their bank account using civil asset forfeiture—they even sent the Dehknos a letter clarifying that 'no violations [of banking laws] were identified.' So, why the mugging? The feds just don't like the way the grocers have been depositing money in their bank account. Really." Continue reading →

Continue ReadingFeds Steal $35K From Small Grocer’s Bank Account Despite ‘No Violations’

Obamacare’s ‘Cool Calculator: Work Disincentives Like Never Before

"Look at what happens once a single person who is 50 or older hits annual earnings of $45,961. At that point, what remains of those wonderful “tax credits” goes up in smoke. For a 50 year-old single person, dollar number 45,961 causes their annual exchange premium (i.e., 'tax') to increase from $4,366 to $5,390. That’s because what Kaiser calls Obamacare’s 'government tax credit subsidy' (they’re also having a hard time with the language) goes from $1,024 to zero. For a 64 year old, a 'tax credit subsidy' of $4,688 gets zeroed out. The marginal tax rate on dollar number 45,961 for that person is a whopping 468,800%." Continue reading →

Continue ReadingObamacare’s ‘Cool Calculator: Work Disincentives Like Never Before

One man’s ObamaCare nightmare

"Andy and Amy Mangione of Louisville, Ky. and their two boys are just the kind of people who should be helped by ObamaCare. But they recently got a nasty surprise in the mail. Insurance for the Mangiones and their two boys,which they bought on the individual market, was going to almost triple in 2014 --- from $333 a month to $965. The insurance carrier made it clear the increase was in order to be compliant with the new health care law. The President's new law, the Affordable Care Act, for the Mangiones will be anything but affordable because the law adds a new tax on every insurance policy and requires a list of additional benefits the Mangiones didn’t want to pay for." Continue reading →

Continue ReadingOne man’s ObamaCare nightmare