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Stock Market Chatter

Lensman

Premium Member
That's something I never could understand, actually. Generally speaking, unemployment money is not even close to a regular salary that (many) people earned, when they had a job. (I "think" it's something like 60% of what people made, during the employment before layoffs.)

Hence, if a person was trying to make ends meet on 60%, or thereabouts, I would think it would be extremely difficult for most to have to come up with tax money. (There are various exceptions, of course, and not to mention those with savings accounts, investments, etc., that they could pull from -- if they hadn't depleted those already, during an extensively long layoff.)

My suggestion would be some sort of sliding scale tax model for the unemployed. Now, for those who did find employment (maybe within the past 6 months), they could be asked to pay "some" tax money on their previous unemployment income; and perhaps there could be some sort of payment plan, spread over months. But for people who had not found a new job yet, I don't think it's appropriate to charge them any tax yet.
Put me down as a contrarian in favor of taxing unemployment compensation. I think it's ok to allow the progressive tax structure determine how much tax one has to pay on unemployment compensation. There are a non-zero number of highly compensated individuals who get unemployment when they're laid off and I'm ok with it being taxed. There are also a non-zero number of people whose spouses are not out of work simultaneously (like Pixie) and who I'm ok with being taxed at their married filing jointly marginal tax rate.

I've been unemployed for a time and received unemployment. I was fine being taxed at my marginal tax rate. I feel it is a fair sliding scale on which to pay my fair share of taxes.

@MinnieM123, that sliding scale you propose is kind of how the current system works. You end up paying tax at your annual marginal tax rate. If you find a job quickly, it ends up that you make more that year and you pay a higher marginal rate. If you don't find a job and are unemployed the whole year, your marginal rate is much lower than if you find a new job pretty quickly.
 

Club Cooloholic

Well-Known Member
Original Poster
An infusion of cash greater than the 2001 Federal budget with no increase (or arguably decreased) in available amounts of goods and services, what could go wrong?

We are going to see a new category of flation. It won't be inflation, deflation, or stagflation but something else.
Inflation was coming based on a lot of things. Oils for plastics and we'll cooking are higher right now that all is hitting the consumers
 

MinnieM123

Premium Member
Put me down as a contrarian in favor of taxing unemployment compensation. I think it's ok to allow the progressive tax structure determine how much tax one has to pay on unemployment compensation. There are a non-zero number of highly compensated individuals who get unemployment when they're laid off and I'm ok with it being taxed. There are also a non-zero number of people whose spouses are not out of work simultaneously (like Pixie) and who I'm ok with being taxed at their married filing jointly marginal tax rate.

I've been unemployed for a time and received unemployment. I was fine being taxed at my marginal tax rate. I feel it is a fair sliding scale on which to pay my fair share of taxes.

@MinnieM123, that sliding scale you propose is kind of how the current system works. You end up paying tax at your annual marginal tax rate. If you find a job quickly, it ends up that you make more that year and you pay a higher marginal rate. If you don't find a job and are unemployed the whole year, your marginal rate is much lower than if you find a new job pretty quickly.

Thank you for your response. Even though it was contrarian, you're still good in my book! :)

I approached the issue from a personal point of view, as I went through it, after 9/11/2001. (Was in the hotel industry, and there were so many layoffs; and I was in the second round of those, a month afterwards.) At that time, I could just barely make ends meet financially, with unemployment money. (Hence, my angst over being taxed on what I could hardly live on, at the time.) And, I did not land a new job until about 8 months later, due to a horrendous job market back then. Many things had to go on credit cards, just to keep up. :( (Since then, I have boosted my emergency savings account up considerably after that crisis! :))
 

Lensman

Premium Member
Thank you for your response. Even though it was contrarian, you're still good in my book! :)

I approached the issue from a personal point of view, as I went through it, after 9/11/2001. (Was in the hotel industry, and there were so many layoffs; and I was in the second round of those, a month afterwards.) At that time, I could just barely make ends meet financially, with unemployment money. (Hence, my angst over being taxed on what I could hardly live on, at the time.) And, I did not land a new job until about 8 months later, due to a horrendous job market back then. Many things had to go on credit cards, just to keep up. :( (Since then, I have boosted my emergency savings account up considerably after that crisis! :))
Hey, I was also out of work in that period. The company I was working for went out of business and they kept a few of us on for a few months before having to let everyone go. Luckily, this give me several months to save up knowing that I was going to be out on the street. It also game me some extra months to look. Coincidentally, it also took me 8 months to get a new job.

The week before 9/11, I actually had a job interview lined up for the following week, but after 9/11 I heard nothing from them again. Like you said, it was very tough times for a lot of people after that.

I think they should increase unemployment insurance - both the premiums and the benefits. That's my preferred solution to it being inadequate. You and I are on the same page about it generally being an inadequate amount.

OTOH, like you said, individuals can take it on ourselves to self-fund an emergency account as an alternative to depending on inadequate unemployment insurance. I come down on the side of making it mandatory via unemployment insurance, though.
 

Laketravis

Well-Known Member
Dang it, I was hoping to surprise you with my new house.

Can you imagine the property taxes alone each year? That area (78746) runs about 1.8% of appraised value. Relatively low tax rates percentage wise for Texas but still.........$685K a year.

Goofy money.

But then, according to some posters around here, nobody wants to live in Texas.
 

TheDisneyDaysOfOurLives

Well-Known Member
In the Parks
Yes
Can you imagine the property taxes alone each year? That area (78746) runs about 1.8% of appraised value. Relatively low tax rates percentage wise for Texas but still.........$685K a year.

Goofy money.

But then, according to some posters around here, nobody wants to live in Texas.

Yeah, that alone hurts me. I guess though I have 38 million, I probably have 700K to pay yearly towards taxes (maybe, I don't know, I don't have money like that to throw around).
 

October82

Well-Known Member
We’ve been told inflation isn’t possible?
Inflation will allow the government to become solvent at the expense of the citizens purchasing power.

If you're referring to my comments, I thought I would take a moment and clarify. The Fed's mandate is price stability, not zero inflation. We expect to see low and stable rates of change in the price level across the economy, broadly defined. This is what the Fed chairman is referring to in the linked article. The Fed sets targets for the inflation rate, and generally inflation has remained lower than those targets. That is what is expected to continue. As the economy returns to full employment, if you believe that there is a danger of the economy overheating, you might be tempted to raise interest rates before reaching the targeted inflation level. What he is saying is that they don't intend to do this. It's an acknowledgement that the Fed does not see the fiscal stimulus as likely to cause the economy to overheat and the price level to rise rapidly.
 

Willmark

Well-Known Member
If you're referring to my comments, I thought I would take a moment and clarify. The Fed's mandate is price stability, not zero inflation. We expect to see low and stable rates of change in the price level across the economy, broadly defined. This is what the Fed chairman is referring to in the linked article. The Fed sets targets for the inflation rate, and generally inflation has remained lower than those targets. That is what is expected to continue. As the economy returns to full employment, if you believe that there is a danger of the economy overheating, you might be tempted to raise interest rates before reaching the targeted inflation level. What he is saying is that they don't intend to do this. It's an acknowledgement that the Fed does not see the fiscal stimulus as likely to cause the economy to overheat and the price level to rise rapidly.
No, wasn’t referring to you.
 

Lensman

Premium Member
The following podcast doesn't go deep enough into this but I'm interested in finding additional study on this.

As a separate topic, I'll note that with my anti-Trump bias, I was very worried about the 2017 tax cut overheating the economy and that the additional deficits would cause increased inflation, but it seems my fears back then were overblown.

I wonder if it really depends on where the money ends up going? It seems that a lot of the 2020 money went to replace lost income (good) and the rest went straight into an increased savings rate and asset bubble (not so good).

Then again, it's also hard to disentangle an asset bubble that's due to more money entering the system (bad) from increased asset prices due to lower interest rates (not necessarily bad).
 

Nubs70

Premium Member
The following podcast doesn't go deep enough into this but I'm interested in finding additional study on this.

As a separate topic, I'll note that with my anti-Trump bias, I was very worried about the 2017 tax cut overheating the economy and that the additional deficits would cause increased inflation, but it seems my fears back then were overblown.

I wonder if it really depends on where the money ends up going? It seems that a lot of the 2020 money went to replace lost income (good) and the rest went straight into an increased savings rate and asset bubble (not so good).

Then again, it's also hard to disentangle an asset bubble that's due to more money entering the system (bad) from increased asset prices due to lower interest rates (not necessarily bad).
I see a concern with adding 1.9 trillion on top of a returning economy. Vaccination should have the economy spinning up at projections approaching 7% growrh then dumping 1.9 trillion on top.
 

seascape

Well-Known Member
I see a concern with adding 1.9 trillion on top of a returning economy. Vaccination should have the economy spinning up at projections approaching 7% growrh then dumping 1.9 trillion on top.
There should be no concern for those of us here since most have lots of investments. Afterall, the studies of those who go to regional themeparks are in the top 40% and those who go to Destination Parks are in the top 20%. Disney and Universal are for the rich and anyone here who thinks they are middleclass but take yearly vacations to either are trying to pretend they are not rich.
 

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