Maximum Wage Ratio

[Revoltingest]

The top forbes folks was the oil and computer giants. And companies like apple should mean great prosperity for US instead of more work for china. The biggest companies get rich at the us expense.

How are they monopolistic though?

 

[freethinker44]

What specific companies do you see being problematic?

Wireless phone providers, cable/internet providers, and particularly frustrating for me, I live in a very rural area so I can't go through the local cable/internet monopoly, so I have to get satellite internet which is insanely expensive for no reason at all except that they know that the only people who are going to buy satellite internet are people who have no choice because of where they live. Oh, and college textbooks, another frustration I'm dealing with right now, $350 dollars for a book, really?

 

[idav]

Wireless phone providers, cable/internet providers, and particularly frustrating for me, I live in a very rural area so I can't go through the local cable/internet monopoly, so I have to get satellite internet which is insanely expensive for no reason at all except that they know that the only people who are going to buy satellite internet are people who have no choice because of where they live. Oh, and college textbooks, another frustration I'm dealing with right now, $350 dollars for a book, really?

Omg, no kidding, I have a hell of a time getting away from windstream though century link hasnt been hard to get out of.

 

[idav]

How are they monopolistic though?

May as well be when just a couple companies own 99 percent of the business and it is in the sense that its next to impossible to compete with such huge corporations.

 

[Apex]

Wireless phone providers, cable/internet providers, and particularly frustrating for me, I live in a very rural area so I can't go through the local cable/internet monopoly, so I have to get satellite internet which is insanely expensive for no reason at all except that they know that the only people who are going to buy satellite internet are people who have no choice because of where they live. Oh, and college textbooks, another frustration I'm dealing with right now, $350 dollars for a book, really?

https://www.youtube.com/watch?v=0ilMx7k7mso

 

[Revoltingest]

Wireless phone providers, cable/internet providers, and particularly frustrating for me, I live in a very rural area so I can't go through the local cable/internet monopoly, so I have to get satellite internet which is insanely expensive for no reason at all except that they know that the only people who are going to buy satellite internet are people who have no choice because of where they live. Oh, and college textbooks, another frustration I'm dealing with right now, $350 dollars for a book, really?

It sounds like you're just in a high price situation, being one of those rural rubes.
But you did choose between cable & satellite. Competition doesn't make everything
cheap....it's just not as bad as with monopolies.

 

[Revoltingest]

May as well be when just a couple companies own 99 percent of the business and it is in the sense that its next to impossible to compete with such huge corporations.

Where there are high barriers to entry (eg, car manufacturing), it will always be difficult to compete.
I've had bad experiences with monopolies too, eg, DTE (electricity), MichCon( gas), AT&T (before Comcast),
Michigan state government. Things have gotten much better for me with phone & utilities. More choice now.

 

[freethinker44]

But you did choose between cable & satellite.

No, I didn't. I chose between satellite and nothing. Actually, I didn't even choose that, I have to have the internet for school, so I couldn't choose nothing. I have to have satellite internet, and I have no choice but to pay the $90 dollars per month that they charge capped at 15 gigabytes.

 

[Revoltingest]

No, I didn't. I chose between satellite and nothing. Actually, I didn't even choose that, I have to have the internet for school, so I couldn't choose nothing. I have to have satellite internet, and I have no choice but to pay the $90 dollars per month that they charge capped at 15 gigabytes.

Oh, I misunderstood. But such a localized monopoly might be unpreventable.
Fortunately, it's your problem, & doesn't affect me. You gotta look at the bright side.

 

[McBell]

Just how much does an individual person need?

How is this relevant?

 

[freethinker44]

Oh, I misunderstood. But such a localized monopoly might be unpreventable.
Fortunately, it's your problem, & doesn't affect me. You gotta look at the bright side.

Right, I understand it is unavoidable sometimes, but they should have more regulation to prevent charging two or three times as much for half the service, maybe something like limiting the amount they can charge to some percentage above the local average for customers who actually have a choice. Currently the only regulation is the government will subsidize a portion of the consumers costs, so in a way it is your problem because your taxes help pay for rural internet customers' ridiculously high charges.

EDIT: I guess the government subsidy for rural internet customers has expired, so there is no regulation or policy to help.

 

[Revoltingest]

Right, I understand it is unavoidable sometimes, but they should have more regulation to prevent charging two or three times as much for half the service, maybe something like limiting the amount they can charge to some percentage above the local average for customers who actually have a choice. Currently the only regulation is the government will subsidize a portion of the consumers costs, so in a way it is your problem because your taxes help pay for rural internet customers' ridiculously high charges.
EDIT: I guess the government subsidy for rural internet customers has expired, so there is no regulation or policy to help.

I don't wanna subsidize your living out in the boondocks.
It just plain costs more to deliver an infrastructure to a sparsely populated area.

 

[freethinker44]

I don't wanna subsidize your living out in the boondocks.
It just plain costs more to deliver an infrastructure to a sparsely populated area.

I don't know, I don't really want to get into it as it's a huge headache for me. I see no reason at all why I can only get satellite here. On the road perpendicular to mine a quarter mile away, they can get cable and DSL, the cable company has lines running by my house because they came to service them in the field across the street, Verizon ran a land line to our house but for some reason we can't get Verizon DSL here, so I don't know. We called different companies and asked about it and they don't know why they wouldn't service this area either, so I'm stuck with it until I'm done with college.

 

[Revoltingest]

I don't know, I don't really want to get into it as it's a huge headache for me. I see no reason at all why I can only get satellite here. On the road perpendicular to mine a quarter mile away, they can get cable and DSL, the cable company has lines running by my house because they came to service them in the field across the street, Verizon ran a land line to our house but for some reason we can't get Verizon DSL here, so I don't know. We called different companies and asked about it and they don't know why they wouldn't service this area either, so I'm stuck with it until I'm done with college.

May your grades be high, & your future internet connection cheap (& fast).

 

[idav]

I don't know, I don't really want to get into it as it's a huge headache for me. I see no reason at all why I can only get satellite here. On the road perpendicular to mine a quarter mile away, they can get cable and DSL, the cable company has lines running by my house because they came to service them in the field across the street, Verizon ran a land line to our house but for some reason we can't get Verizon DSL here, so I don't know. We called different companies and asked about it and they don't know why they wouldn't service this area either, so I'm stuck with it until I'm done with college.

Thats surprising. I am in a pretty rural state and verizon has managed to get to most of our smaller towns even. 4G lte even. Had to resort to them where I have cable dsl issues but there cap on data isnt fun as verizon will be happy to charge for overage. If they ran something sounds like your close , good luck with that, I feel your pain. I had to wait all year for one of our towns to get the 4g lte.

 

[freethinker44]

Thats surprising. I am in a pretty rural state and verizon has managed to get to most of our smaller towns even. 4G lte even. Had to resort to them where I have cable dsl issues but there cap on data isnt fun as verizon will be happy to charge for overage. If they ran something sounds like your close , good luck with that, I feel your pain. I had to wait all year for one of our towns to get the 4g lte.

We get cellular service, we just can't get their DSL service.

 

[Reverend Rick]

I have an AT&T hot spot. It gives me internet where ever I go.

 

[Monk Of Reason]

Not always true. There are different classes of assets with different rates on gains (eg, collectibles are at the full ordinary income rate). But the rate isn't the issue. If the amount still ends up being so high that the debtor cannot raise the cash to pay it (in advance, as required by the bank), this effectively prevents the debtor from solving his default problem. This is one reason why the crash is lasting so long.

What are you ideas to solve this situation? What do you think are the risks involved in your solution?

I know, I know....no matter what the level of taxation, it should always be raised.
I hear that a lot. But beware the unintended consequences of taking ever more.

Actually I'm not in favor of all kinds of tax increase. The majority of taxes should be lowered. Corporate tax rate actually should be lower. The problem is no one actually has to pay their tax rate when it counts. effective tax rate needs to be higher. The only tax rate I think really needs to go up are certain types of capital gains taxes. For example we don't really have an effective stock tax. I can simply sit on stock and make out without having to pay very much taxes at all. Thats why day trading is so popular with those savvy with it.

Consider the larger issues. Does it make sense to charge a large tax which is triggered by solving a foreclosure & bankruptcy problem? (Homeowners are exempt, btw...their principal reductions are tax free. They have better lobbyists, eh.) Government seems to prefer having the foreclosure process continue, the property lost, & the owner filing for bankruptcy protection (Fannie & Freddie policy). This generates no tax revenue, & causes economic carnage. Moreover, to define principal reduction as ordinary income goes against GAAP.

There have been several attempts to help homeowners with initiatives and the like. I feel this has been a failure of our government to assist those in need especially in these situations. However these specific laws are in place to stop another tragedy in the marketplace.

Again what are your ideas on the subject? What would the laws be were you king of America for a day?

Banks must certainly protect themselves, but they aren't the cause....the IRS is. Owners who can't make the loan payments are seldom in a position to raise the cash to cover the tax liability triggered by a loan discount. Catch 22: If you don't need the money, you'd be making your payments, & wouldn't be in trouble. If you can't make the payments because you're short of cash, then you need to have a lotta cash in order to renegotiate/refinance the loan. Few of us are able to solve this dilemma.

Indeed. Kind of like how when you have a bank account and if you don't have enough money in your account they charge you. And if you ever bounce a check or don't have enough money to pay it they fine you again for not having enough money to pay them in the first place.

There's no tax liability for the lenders due to discounting or lending. A lender who discounts even gets to treat the loss as a tax deductable expense (after which they 1099 the borrower).

True. However the lender in a failed situation has taken a hit and the IRS gets screwed out of its money. The IRS law is in place to protect the IRS.

This is where governmental reasoning has it backwards. Every loan renegotiation/refinance they prevent ensures a 100% chance of foreclosure. If gov didn't take its cut of the discount, there's a high probability of the new loan succeeding. Gov policy actually increases economic instability in these cases.

Correct. I have never stated that the laws and regulations don't need to be re-worked. I have stated that it has been lack of regulation rather than over-regulation that has been the root cause of the economic downfall and slow recovery.

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

What requirement?

 

[Revoltingest]

What are you ideas to solve this situation? What do you think are the risks involved in your solution?

There are several approaches which would mitigate the real estate collapse:
Primary residential:
- Allow Fannie & Freddie to bargain down the principal for defaulting borrowers.
Commercial:
- Treat principal discounts as a basis reduction (which they deem fair for homeowners). This way the 'gain' will be taxed at a later date, & won't squelch the recovery deal.
- Treat principal reductions as capital gains. This treats the 'gain' in a more GAAP fashion, & the reduced tax rate will enable more deals.
- The IRS should finance the tax liability with a structure which will enable far more deals. This should also be done without micromanaging the taxpayer's affairs (typical of large shortfalls, but quite burdensome & off putting for banks).
- Allow carry forward losses to be applied to the 'gain'. This is fair.

Risks? None, since the alternative is 100% failure of the borrower's loan. And there is no new money being lent in a restructuring or refinance. Everyone wins...which might by why gov opposes it, ie, some people shouldn't be seen as benefiting (the "wealthy").

Actually I'm not in favor of all kinds of tax increase. The majority of taxes should be lowered. Corporate tax rate actually should be lower. The problem is no one actually has to pay their tax rate when it counts. effective tax rate needs to be higher. The only tax rate I think really needs to go up are certain types of capital gains taxes. For example we don't really have an effective stock tax. I can simply sit on stock and make out without having to pay very much taxes at all. Thats why day trading is so popular with those savvy with it.

One reason capital gains taxes are lower (but not lower for all assets) is that much of gain is phantom, ie, I pay tax on gain due to lower currency value (aka inflation).
Hypothetical example (ignoring depreciation):
Year 2000: You buy 123 Easy St for $1,000,000.
Years 2000 thru 2010, inflation is 7%
After 10 years at 7% inflation, the value of a dollar is 50% less.
Year 2010: you sell 123 Easy St for $2,000,000.
The IRS would tax you on $1,000,000 profit, even though the price you paid & the price you sold it for are the same after adjusting for the lower value of the dollar.
This is one reason the fed increases the money supply faster than the economy
grows....so they can tax you on the lost value of the dollar.
It would be better to set all capital gains to the ordinary income tax rate, but adjust the profit for inflation. This would be more realistic, fair, & have less market distortion.

There have been several attempts to help homeowners with initiatives and the like. I feel this has been a failure of our government to assist those in need especially in these situations. However these specific laws are in place to stop another tragedy in the marketplace.

The initiatives were a sham. I've known many who tried, but none have succeeded to use them. There's always some disqualifier, eg, not one late loan payment allowed.

Again what are your ideas on the subject? What would the laws be were you king of America for a day?

- Entrapment is legal for public employees.
- Government must meet the same building, zoning & housing codes they impose upon us.
- Public employees will be vigorously prosecuted for all crimes committed. No looking the other way.
- All unlawful violence committed by cops will result in immediate prosecution.
- Legalize prostitution & more recreational drugs.
- Comprehensive trade skills taught in schools.
- Immediate withdrawal from all foreign adventures, eg, Afghanistan, Iraq.
- Film another season of Deadwood.
- Stop all foreign aid, except where voluntarily privately financed.
- Get rid of foreign banks like the Royal Bank Of Scotland (owned by the Brit gov), who are the crooks behind LIBOR manipulation & misbehavior (eg, exasperating the crash by refusing loan extentions) in Americastan. They don't have this country's interest at heart.
- Etc, etc, etc.

Indeed. Kind of like how when you have a bank account and if you don't have enough money in your account they charge you. And if you ever bounce a check or don't have enough money to pay it they fine you again for not having enough money to pay them in the first place.

Something like that.

True. However the lender in a failed situation has taken a hit and the IRS gets screwed out of its money. The IRS law is in place to protect the IRS.

IRS revenue would increase if they didn't actively prevent people from salvaging their investments. They need to be a little less rapacious, & be willing to wait for underwater owners to recover.

Correct. I have never stated that the laws and regulations don't need to be re-worked. I have stated that it has been lack of regulation rather than over-regulation that has been the root cause of the economic downfall and slow recovery.

Over-regulation is a big problem. All regulations have compliance costs, so even benign regulations are a damper on the economy. We can have far greater system stability with less (but useful) regulation.

What requirement?[/quote]
Gov bank auditors & the Community Reinvestment Act have required banks to make loans which they historically avoided. Plus Fannie & Freddie (US gov created & run) bought 95%+ LTV loans from the banks so that the taxpayers assumed this large risk instead of the initial lender. This encouraged risky lending. Take some banker friends to lunch, & discuss what their work is like. It's an eye opener you'll never get from Huff Po or the NYT.

 

[Monk Of Reason]

There are several approaches which would mitigate the real estate collapse:
Primary residential:
- Allow Fannie & Freddie to bargain down the principal for defaulting borrowers.
Commercial:
- Treat principal discounts as a basis reduction (which they deem fair for homeowners). This way the 'gain' will be taxed at a later date, & won't squelch the recovery deal.
- Treat principal reductions as capital gains. This treats the 'gain' in a more GAAP fashion, & the reduced tax rate will enable more deals.
- The IRS should finance the tax liability with a structure which will enable far more deals. This should also be done without micromanaging the taxpayer's affairs (typical of large shortfalls, but quite burdensome & off putting for banks).
- Allow carry forward losses to be applied to the 'gain'. This is fair.

-Agreeable.
-What is the guarantee they can pay later?
-I"m assuming not reduced too much as to be be lax on risky investments.
-Great but how?
-tiz' fair

Risks? None, since the alternative is 100% failure of the borrower's loan. And there is no new money being lent in a restructuring or refinance. Everyone wins...which might by why gov opposes it, ie, some people shouldn't be seen as benefiting (the "wealthy").

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

One reason capital gains taxes are lower (but not lower for all assets) is that much of gain is phantom, ie, I pay tax on gain due to lower currency value (aka inflation).
Hypothetical example (ignoring depreciation):
Year 2000: You buy 123 Easy St for $1,000,000.
Years 2000 thru 2010, inflation is 7%
After 10 years at 7% inflation, the value of a dollar is 50% less.
Year 2010: you sell 123 Easy St for $2,000,000.
The IRS would tax you on $1,000,000 profit, even though the price you paid & the price you sold it for are the same after adjusting for the lower value of the dollar.
This is one reason the fed increases the money supply faster than the economy
grows....so they can tax you on the lost value of the dollar.
It would be better to set all capital gains to the ordinary income tax rate, but adjust the profit for inflation. This would be more realistic, fair, & have less market distortion.

Its difficult to calculate the specific inflation rate. 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 initiatives were a sham. I've known many who tried, but none have succeeded to use them. There's always some disqualifier, eg, not one late loan payment allowed.

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

- Entrapment is legal for public employees.
- Government must meet the same building, zoning & housing codes they impose upon us.
- Public employees will be vigorously prosecuted for all crimes committed. No looking the other way.
- All unlawful violence committed by cops will result in immediate prosecution.
- Legalize prostitution & more recreational drugs.
- Comprehensive trade skills taught in schools.
- Immediate withdrawal from all foreign adventures, eg, Afghanistan, Iraq.
- Film another season of Deadwood.
- Stop all foreign aid, except where voluntarily privately financed.
- Get rid of foreign banks like the Royal Bank Of Scotland (owned by the Brit gov), who are the crooks behind LIBOR manipulation & misbehavior (eg, exasperating the crash by refusing loan extentions) in Americastan. They don't have this country's interest at heart.
- Etc, etc, etc.

-Why?
-Agreed with all the rest except for the prostitution one. Though that is for another thread.

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

IRS revenue would increase if they didn't actively prevent people from salvaging their investments. They need to be a little less rapacious, & be willing to wait for underwater owners to recover.

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

Over-regulation is a big problem. All regulations have compliance costs, so even benign regulations are a damper on the economy. We can have far greater system stability with less (but useful) regulation.

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

Gov bank auditors & the Community Reinvestment Act have required banks to make loans which they historically avoided. Plus Fannie & Freddie (US gov created & run) bought 95%+ LTV loans from the banks so that the taxpayers assumed this large risk instead of the initial lender. This encouraged risky lending. Take some banker friends to lunch, & discuss what their work is like. It's an eye opener you'll never get from Huff Po or the NYT.

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.

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.