Maximum Wage Ratio

[Revoltingest]

What is the guarantee they can pay later?

No guarantee. But a probability of being paid later is better than a certainty of loss now.

I"m assuming not reduced too much as to be be lax on risky investments.

The word "lax" seems inapplicable, & risk shouldn't determine tax rates.

Great but how?

Same as the IRS does now for piddly tax debt ($50K or less).[/quote]
There is a net reduction of risk by allowing debt restructuring/refinancing.
If not allowed: The borrower is foreclosed upon & goes bankrupt.
If allowed: A principal discount is given, but no new money is lent. Now the borrower has an affordable loan with a high probability of success.

The problem is the system needs to be re-vamped with better regulations rather than some of the broken ones we have now.

The political process seems unlikely to put the needed regulations into place.
Politicians have short term concerns which are at odds with long term economic stability.

Its difficult to calculate the specific inflation rate.

No, it's easy. I do this already with adjustments to collecting court judgements & the yearly judgement rate of interest. The math is simple.

However in a worst case scenario where the value of the dollar goes up would they be able to tax you because the wealth you started with is now greater?

The value of the dollar going up (aka deflation) is a rare thing cuz gov prevents it.
But if this happened, it would be appropriate & fair to adjust for it. To take into account both inflation & deflation is the general case.

Agreed. However if they had been made in a comprehensive way it could do more good I think.

Yes. But I believe they intended that the programs would never help many.
Why? Pols wanted to look helpful, but didn't want to have to spend the money there.

-Why?

Why about what?

Though none were specifically having to do with what we were talking about.

You make me King, then you get unintended consequences. (I'm drunk on power now.)

However there is a big myth that if you simply cut taxes it leads to higher revenue.

I agree that myth is an over-simplification.

...cutting taxes in a smart way can lead to growth. This may be one of them. However it appears there are risks involved as well.

I've done a lot of debt collection. I know what works (generally) & what doesn't. No matter how hard one tries, one cannot get blood from a stone. To force a debtor into bankruptcy because one won't budge on the debt guarantees total loss. To negotiate something they can afford is more profitable. As a judge once told my lawyer, "Pigs get fed. Hogs get slaughtered.".

Most of your problems don't seem to be about "over" regulation as much as "bad" regulation.

I agree.

I had to do a little bit of research on the Act and what I found was mixed. Apparently the studies have shown that it isn't necessarily more profitable for the banks or the economy to lend more or have pressures (making it more or less reduntant rather than harmful in nature) or at best it would increase home ownership in the lower income levels.

Btw, I don't believe in subsidizing home ownership.
- It's unfair to renters.
- It reduces labor flexibility, since moving is far more difficult & expensive.
How many other brokers & members of the Board Of Realtors (former) do you find advocating this!?

The point of the legislation was to prevent landlord rule of the market or at worst an economic barrier that would prevent the ability of people to move upwards in society similar to that of England from pre-colonial times to the early 1900's.
The biggest criticism that I read (or at least the most common given the strictly limited amount of time I have spent researching it) was that it was "unnecessary" rather than harmful directly.

I see it as harmful, but it's a small part of a larger collection of governmental sins.

 

[Monk Of Reason]

No guarantee. But a probability of being paid later is better than a certainty of loss now.

For the person. Not the IRS.

The word "lax" seems inapplicable, & risk shouldn't determine tax rates.

Rates for sure. However there should be items in place to prevent bad lending practices.

Same as the IRS does now for piddly tax debt ($50K or less).
There is a net reduction of risk by allowing debt restructuring/refinancing.
If not allowed: The borrower is foreclosed upon & goes bankrupt.
If allowed: A principal discount is given, but no new money is lent. Now the borrower has an affordable loan with a high probability of success.

Other factors are involved in the probability of their success but I can more or less agree. However this again seems to be an issue with bad regulation rather than over regulation.
[qutoe]
The political process seems unlikely to put the needed regulations into place.
Politicians have short term concerns which are at odds with long term economic stability.[/quote]
Could not agree more. High probability that we disagree on what needs to be in place...but at least on this we agree.

No, it's easy. I do this already with adjustments to collecting court judgements & the yearly judgement rate of interest. The math is simple.

The value of the dollar going up (aka deflation) is a rare thing cuz gov prevents it.
But if this happened, it would be appropriate & fair to adjust for it. To take into account both inflation & deflation is the general case.

Inflation doesn't always happen evenly or at least the effects aren't always felt evenly. It also leaves room for those to argue.

And fair.

Yes. But I believe they intended that the programs would never help many.
Why? Pols wanted to look helpful, but didn't want to have to spend the money there.

reluctantly agreed.

Why about what?

Legal for government employees to use entrapment?

You make me King, then you get unintended consequences. (I'm drunk on power now.)

Lessoned learned. You've been demoted to king of housing and real estate tax regulation king.

I've done a lot of debt collection. I know what works (generally) & what doesn't. No matter how hard one tries, one cannot get blood from a stone. To force a debtor into bankruptcy because one won't budge on the debt guarantees total loss. To negotiate something they can afford is more profitable. As a judge once told my lawyer, "Pigs get fed. Hogs get slaughtered.".

Not sure I get the reference but I understand where you are comming from. However this complicates the laws more.

Btw, I don't believe in subsidizing home ownership.
- It's unfair to renters.
- It reduces labor flexibility, since moving is far more difficult & expensive.
How many other brokers & members of the Board Of Realtors (former) do you find advocating this!?

The law doesn't subsidize though. At least thats not what I read (again not an expert just a 20 minute dedication to looking online)

I see it as harmful, but it's a small part of a larger collection of governmental sins.

It is harmful to several landlords. Its not harmful specifically to lower income homeowners.

 

[Revoltingest]

For the person. Not the IRS.

No, they get next to nothing from a bankrupt investor.
While the bankruptor owes tax on the dismissed principal, the IRS typically settles
for pennies on the dollar. They do better if the investor remains productive.

Rates for sure. However there should be items in place to prevent bad lending practices.

Hmmm....how to explain...how to re-explain.
If a loan has already gone bad, to restructure it so it is no longer bad is what government prevents.
Tis a major problem that so many lefties & gov types believe this prevention is good policy. The idea
that a loan gone bad should remain bad, & that gov should actively prevent recovery makes no sense to me.

Other factors are involved in the probability of their success but I can more or less agree. However this again seems to be an issue with bad regulation...

No kidding.

Inflation doesn't always happen evenly or at least the effects aren't always felt evenly. It also leaves room for those to argue.

No, it's pretty simple & straightforward (basic time value of money math for us engineers), far more so than many aspects of the tax code. Gov can simply pick an index (eg, the CPI), as does the court.

Legal for government employees to use entrapment?

No, you big silly!
It should be legal to entrap gov employees. They should fear the worst if they dare to take bribes or commit other violations of the public trust. Let them worry that every solicitation might be a cop tempting them. It'll keep'm honest. Is it fair? Sure...any gov employee who thinks he/she will be tempted to commit crimes should stay out of the public sector.

Lessoned learned. You've been demoted to king of housing and real estate tax regulation king.

No way...I want it all...call me "Grand Poobah"!

Not sure I get the reference but I understand where you are comming from. However this complicates the laws more.

If it's "complicated" to treat taxpayers such that they & government are both better off, then let's get crack'n. But no, it needn't be complicated. And that never mattered to gov aparatchiks before. The tax code is now well over 70,000 pages, & IRS agents & CPA's I've dealt with cannot agree on even simple matters. What I propose is simpler than what I face now.

The law doesn't subsidize though.

The tax code is law, & it gives deductions to homeowners which aren't matched for renters, eg, deductable interest, deductable property taxes, capital gains tax abatement on profit from sale of one's home.

It is harmful to several landlords. Its not harmful specifically to lower income homeowners.

Lower income homeowners who defaulted on loans later sold to Fannie or Freddie were greatly harmed by extending more credit than they could handle.

 

[Apex]

This came up on my FB feed. Would have to double check the numbers, but if true, it is very interesting.

 

[Revoltingest]

This came up on my FB feed. Would have to double check the numbers, but if true, it is very interesting.

Woo hoo!
We're #1!
We're #1!

 

[dust1n]

Overbearing regulation was part of the problem though, especially in the requirement that lenders make risky loans to targeted borrowers.

Perhaps this was addressed at some point in the past, but what is the requirement that lenders make risky loans?

 

[Revoltingest]

Perhaps this was addressed at some point in the past, but what is the requirement that lenders make risky loans?

I'm aware of a few:
- Community Reinvestment Act
- Gov auditors
- A condition for mergers & acquisitions

 

[dust1n]

I'm aware of a few:
- Community Reinvestment Act

What about CRA requires banks to make risky loans?

- Gov auditors
- A condition for mergers & acquisitions

In what instance?

 

[Revoltingest]

What about CRA requires banks to make risky loans?

Don't know...never read it.
It's what I hear from bankers.

In what instance?

Again, I can't name one. Take a banker to lunch, & you'll get an earful.
Btw, if you need to borrow money periodically, stay on good terms with every banker you ever meet.
You never know when an old relationship will come in handy.

 

[Alceste]

Businesses (CEO's) small and large need to realize that their salary is created by the employees at all levels. If a CEO has a disproportionate income compared to his workers, then it's on the owner for morality reasons. I'm not in favor of a maximum cap on income, as it was pointed out before, the maximum wage of an owner should be a moral boundary.

I agree - the owner of any business has a moral obligation to pay her employees fairly. However, what are we as a society to do if a business owner simply disregards her moral obligation?

We generally (ok, ideally then) don't pass regulations to stop people from behaving morally. We communicate the boundaries of our collective sense of morality through regulations, treaties, best practices, professional standards, etc.

We shouldn't need a law against ******** in the communal well, but since the world contains people who do such things for a lark, we need to make it an official rule, with consequences.

The top 0.01%, by continually striving to siphon wealth out of their employees pockets and into their own, are ******** on the whole world. If they would voluntarily choose to be moral, we wouldn't need a law.

 

[Dirty Penguin]

This came up on my FB feed. Would have to double check the numbers, but if true, it is very interesting.

It looks correct. It reminds me of this here...


It's the Inequality, Stupid | Mother Jones