If you want the housing and stock market crash to end, and the US to avoid a deep recession or depression, here's 10 things the government could do tomorrow to stop the bleeding:
1) Raise the 401k max contribution to $100,000 in 2008, 2009 and 2010
2) Raise the Roth IRA max contribution to $50,000 in 2008, 2009 and 2010
3) Permanently eliminate taxes on savings accounts earnings held in US banks
4) $10,000 immediate tax credit for any home purchased for residence or investment with 10% or more down in 2009 or 2010
5) Offer 40-year 4% fixed rate refinance mortgages to any qualified homedebtor on up to 90% of current appraised value with the government to receive 20% of any gross profit if home is sold
6) Eliminate forced withdrawals from 401k's for 2008, 2009 and 2010
7) $5,000 one-per-person matching funds check from the US government good towards the downpayment on any bank-owned or foreclosed home in 2009 or 2010
8) Allow up to $20,000 to be withdrawn from 401k's tax free in 2009 or 2010 if used toward the purchase of a house with at least 10% down
9) Arrest Angelo Mozilo, Dick Fuld and Michael Perry
10) Charge a nationwide 10% tax on all rents starting in 2010
I'm not recommending all of these HP'ers. I'm just brainstorming the kinds of things the government could do, and may do, to end the housing and stock panic, even if it puts off the day of reckoning and creates even more moral hazard down the road.
Stay tuned. And get ready for some serious incentives to buy homes and stocks. You ain't seen nothin' yet.
The United States is desperate. And desperate leaders of desperate countries do desperate things.
October 29, 2008
10 ways the US government could stop the housing and stock market crash tomorrow
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79 comments:
Tax rent? I already pay my landlord's property tax and he gets the mortgage-interest tax break. NO.
YEAH, UP THE CONTRIBUTION LIMITS TO $100K FOR 401 AND $50K FOR ROTH IRAS.
KEITH, YOU TOOL, 99% OF THE SHEEPLE DO NOT HAVE $100K IN ANY RETIREMENT LET ALONE HAVING IT BURNING A HOLE IN THEIR BANK ACCOUNT. NICE RECOMMENDATION.
DOPES!!!!!!!!!!
Allow HPers to exchange their gold for housing "coupons" at a $10,000/oz exchange rate.
11. Lower long-term capital gains rates for long-term owned investment REAL ESTATE (not stocks, bonds,etc.)
0-2 years: No reduction
3-5 years -5% to 10 %
5-9 years - 10% to 5%
10 years or longer - 0%
If Bushco-Cheneyburton-Paulson/Col. Klink can bailout banker friends,why can't I as an individual investor make a few bucks for my risk over the long term?
Fuck America. It's all rigged.
the only good idea in this post is number 9.
you want to fix housing?
let the fracking prices drop to affordibility...PERIOD!!!
I floated (believed to be the first) the tax free withdrawal from 401K about a year ago on another blog. I still believe this to be a significant stimulus.
Looks like deleveraging may be slowing down. Once the DX parabolic spike finishes, it will be interesting to see how the M2 flood affects the buck. Could be quite the whipsaw - and it's interesting how it is always out of phase. Greenbacks were sliding when M2 was actually contracting, now with the huge interventions, all that cash will start seeping into the market. Can't see how inflation won't eventually come back.
Some good ideas there to bad they wont do ANY of them.
The first thing they have to do is examine the tier 3 assets of all major banks before giving them a dime. If the banks are clearly bankrupt, THEN LET THEM GO UNDER. Then have the government take over all loans/deposits and normal business of the banks excluding the exotic derivatives (vanilla swaps fine), which, should be declared void.
The second thing is raise the gas tax at the pump $0.50 per year for 4 years.
3rd - means test social security
4th - eiminate perscription drug benefit plan
5th - freeze medicare expenditures for at least 4 years
6th - cut military expenditures by 10% per year for next 4 years
Just a start
Keith, what have you been smokin’?
Renters win (because they don't pay tax on rent), and Mammoth loses today.
Just wrote a check for $2,300 to pay property taxes. Ouch!
Looking at the tax statement,
- 29% goes to schools
- 22% to the state’s general fund
- 21% to the fire dept
- 13% for county roads
- 10% to the county
The remainder is split between the libraries, port, and PUD.
- - - - - - - - - - - - - - - - -
Comments/Opinions:
- Doesn’t 1/3 of taxes going to the schools sound like a lot? That is more than what the state gets, and more than what the county gets! I wonder what the school system is doing with MY money, and how efficiently they are spending it. Teachers sure don’t get CEO pay – where does all this money go?
- The county’s and county road’s take is really the same, in a way, so the county sucks down nearly ¼ of MY tax $. But look at it this way – if you combine these two, then the road department keeps 57% of the money the county takes in. Why does the road dept. spend more than the rest of the county does, and how does the road department spend MY tax $? (The thought of seeing the road workers standing aroung leaning on their shovels, playing ‘pocket pool’ comes to mind.)
- Apologies if firemen are revered as heroes, but how can they possibly be spending 1/5 of MY tax $? What are they spending all this money on?
- And I won’t even get started on my feelings about how Washington State pours my 22% down the toilet!
What percent of this tax money is going to these state & county worker's health care & retirement funds, which give way above and beyond the benefits that us working stiffs in the private sector receive from our employers?
- - - - - - - - - - - - - - - - -
Just some random thoughts which came to mind, as I grudgingly hand away a good-sized chunk of money, for which I had to put up with a lot of sh!t in order to earn.
Renters: 1
Mammoth: 0
How about a Federal program to star bulldozing all those McMansions in Las Vegas, Phoenix and Stockton that no one will EVER live in? We could hire all the unemployed auto workers for half of what they make now to do the work, use the scrap lumber to keep us warm this winter and reduce the number of empty houses on the market all at the same time? (While they are at it, a bunch of inner city Detroit and Cleveland could probably be knocked down while you're at it.)
And yes, I am only half kidding.
"People are going to be demanding that someone go to jail," say Rep. Peter DeFazio (D.-Ore), who says his constituents have applauded him for voting against the legislation. "It will require Democrats to revisit restrictions [on CEO pay]. "
DeFazio says he would also recommend Congress "empower a division in the FBI and Justice Department to investigate the fraud and misdeeds that went on."
proud to say he represent my state. there are a couple worth keeping in congress.
These are very good first steps.
One addition, IMHO ... a biggie ... huge one.
A reward for everyone who has stayed current on all bills ... credit cards, house payments, rents, medical ...
Remember those people are carrying this country on their backs. You let them fall out of that ... the system collapses further. Heck add in a graduated system on a yearly basis and get them an added refund. Like this year they received 1000 in bills and were current on 950 ... so they were 95% good, and they get a 95% of the allocated money per family. Sorta like a bush tax cut ... the 300 or whatever is the maximum you get ... if you paid 100% of all your bills.
Cool.
Cow_tipping.
Damn critical thinking you did keith!
Although I only read the list once I like all of the suggestions. you are hinting at the end will be housing incentives by our us goverment. How do you know this is what they are thinking? How bad does it get before this happens? WHy aren't you or people like you in important positions?
#10 is bad. This hurts both tenants and landlords. A classic wedge between people making an economic agreement. Letting rents settle (or rise to) their market level will help the housing market eventually reprice itself correctly.
No new taxes. There is no economic crisis, you people are making a big deal out of nothing.
The tax exemption for savings account interest income is one of the best ways to get people to start saving. Currently by taxing interest income you create a dis-incentive to save and an incentive to spend (to avoid the tax & have something that is not taxed).
Our North American cousins up north in Canada have it up to 5k per year.
Once a solid savings base is established then consumer consumption will grow at a sustainable and sensible rate. By supporting consumption with faux home equity wealth this was bound to happen. Lets rebuild America if on a financially sound foundation of assets and liabilites in the form of savings and loan products that do not explode after 3-5 years (w/ 20% down of course).
Good ideas but disagree on 10% tax on rents.Have you ever been a landlord? lots of people are losing their ass right now as it is.
Begin Claw Back of all money made by the participants in the credit / housing market bubble. IE Mozillo All of their profits need to be taken. They have created this mess and made huge profits. The taxpayer should not have to pay for their profits.
Charge a transaction fee of 1-5% for all sales of equities / securities. Individual investors of less than 50,000 a year = 1%. Sliding scale for larger investors. Exempt pension funds.
Make all hedge fund managers pay income tax on their earnings / income.
On corps doing business in America, the majority of which pay no income tax: If the corp pays no income tax, then they must pay a Business and Occupations tax of 10% on gross receipts. No deductions allowed tax paid on gross receipts. Similar to Washington state B&O tax.
Reinstate the estate tax and or eliminate the stepped up cost basis for assets in the estate. The stepped up basis allows the asset to pass to heirs at the market Value at the time of death. This is a huge tax benefit as the heir at the time of sale on pays cap gain tax on the gain between the stepped up basis and the sale price. This allows many asset to pass under a different tax rule then most of us pay on the sale of our assets. And the purchaser of the asset paid no tax on the asset during their life.
Other wise reinstitute the estate tax with a 3 million dollar deduction. Thus, 80-90% of the estates pass without paying taxes.
No tax on any interest earned on saving accounts.
Tax the FED every time they loan money say 1% to fund the bailouts.
Restrict interest on pay day loans to 5% and credit card balances of less then $10,000 to 8%. With a sliding scale interest to higher credit card balances.
Pay attention to bubbles and stop them early.
To kick start the economy, create good paying jobs and give the middle class a tax break. People can not consume when they are saddled with debt and have low earnings. Reducing the debt burden will also stimulate, as the consumer will have more money to consume.
These are ideas to supplement the very good ones posted on the blog.
Ella
Why stop it?
As far as item 1-9 are concerned,
why a bunch of complicated rules? Just give everybody a $1 million dollar stimulus payment and be done. That should work out just fine.
"10) Charge a nationwide 10% tax on all rents starting in 2010"
Better yet, arrest all renters, confiscate their assets and ship them to Guantanamo Bay for un-American activities along with all the other terrorists. That should teach 'em.
But seriously, putting all our effort into creating a stock market bubble and re-inflating the housing bubble is getting us nowhere except into deeper doodoo than we already are. An economy can't live on bubbles alone ya know.
10% on rents? why?.......
God forbid.
Not taxing savings is a good one.
The bottom line: we produce X
we consume 1.4 X
consumption needs to be less than production with the difference (also know as savings) going towards technological development.
It really is that simple folks.
And yes I do support repudiating all Neocon debt.
%10 tax on rents? go fk yourself
Are comments still posted on this blog?
11) Help me lose 40 pounds.
12) Nobody has to work on Sundays.
13) Give all married 39 year old self-employed males with 3 children an $18,000 stimulus check.
14) It only rains at night while everybody is sleeping anyway.
10) Charge a nationwide 10% tax on all rents starting in 2010
F&*K YOU! I didn't participate in this mess and I refuse to help bail out those that did.
You have a lot of good ideas Keith .
You could add stimulation for jobs on rebuilding roads ,bridges, and
other needed projects that have been ignored for years.Its very important to get new job direction away from real estate scams .
Qweeferonio,
Boy am i glad you're not Secretery of treasure.
1 suggestion may be to allow people to withdraw from their 401k without tax or penalty if the money goes to purchase a house
10) Charge a nationwide 10% tax on all rents starting in 2010
i don't follow you on this one.
trying to discourage renting? a large portion of the population are forced to rent as they can't really afford a house. a 10% tax would hurt their ability to save up a down payment.
Would love to see #3 put into play. So tired of being punished for being a saver.
http://www.youtube.com/watch?v=W9mhsW5aWJM
#9 is the only good idea on the list
The rest of these suggestions retain and amplify rotten overpricing, setting the stage for a much worse crash in the future - after the government funded bubbles pop. The US government will be bankrupt, and no one in the world will bail us out. The US government, under our current constitution, must be seen as the only institution "too big to fail", and it must be protected accordingly.
We need to think long-term, even if the result is short term pain.
The tax code needs to be simplified, to remove incentives for mal-investment.
401Ks and IRAs encourage middle class investors to constantly buy stocks, regardless of price. Savy traders profit - there are always buyers, no matter how ridiculously high stock prices get.
Tax incentives for home buyers act just like lax lending standards - they raise prices, and accordingly turn buyers into life-long debt peons.
Here are sustainable ways to bolster housing prices, stock prices, and the size of the finance sector:
1. Housing Prices - On the regional level, increase the average income of the middle 90% of wage earners. Only by increasing income can you justify current prices, in terms of the median home price / median income ratio. On the local level, good local government to improve the quality of the neighborhood will help.
2. Stock prices - Increase GNP, and thus corporate earnings, until P/E ratios make sense.
3. Finance sector - Triple GNP while finance sector stands still, and balance will be restored.
Basically, any government aid should be directed at every sector of the economy - EXCEPT the currently oversized finance-insurance-real estate sector. More bailouts will only throw more good money after bad into the black hole that is the REIC.
Give unemployed Americans the jobs currently held by illegal aliens. Acheive energy independance. Start manufacturing our stuff here again, instead of importing it from China etc. Stimulate all export oriented industries, and attract foreign tourists.
By the way, check out the really nice Case-Schiller spread sheets on Mike Shedlock's Global Economic Trend Analysis site.
with todays fed rate cut i have to wonder just whose "economy" the fed is trying to revive... certainly not the economy of those savers who deposit money into banks as they will lose purchace power of some much and then with the government putting trillions now into banks?????????????????????????????/
need 20 year treasuries at 20 percent yeilds and no inflation, just to break even with the loses from banking money???????????/ aint gonna happen............
"If a private enterprise is a failure, it is closed down - unless it can get a government subsidy to keep it going; if a government enterprise is a failure, it is expanded. I challenge you to find exceptions."...
"Milton Friedman, Why Government is the Problem, Wriston Lecture (1991)"
9) Arrest Angelo Mozilo, Dick Fuld and Michael Perry
I'd do it myself if I saw them on the street.
Can I get a 4%, 40 year fixed rate mortgage too?
Sorry, sir, your credit score is too high.
How about doing nothing and letting the market sort it out?
How about just swapping your social security money for debt on your home?
10) Charge a nationwide 10% tax on all rents starting in 2010
WTF??? Must be a brain fart on Keith's part
BUT capitalist DONT want to stop the housing crash. The whole point behind the crash is to make Americans wages "competitive" with Asians.
When the ave. US house costs 100K and the ave US salary is 30K, then US workers will be "competitive" again.
That's the plan.
Man, some of you are thick. Must be the McCain voters.
This isn't a list of what I RECOMMEND. It's a starting list of what I think the government MIGHT DO.
Get it?
You're about to see some serious market intervention and manipulation. You can thank the evil-doers at the NAR and NAHB for that. Just like the $250,000/$500,000 cap gains exclusion and mortgage interest deduction.
The US government cannot afford to have houses fall to their natural values, or for stocks to go down 90%. So they're going to use their powers to artificially stimulate stocks and real estate.
Take that to the bank.
And you think 10% tax on rents is bad? How about 25%? Maybe 50%?
Just watch. You've been warned.
I actually can see how a lot of those options would work. People are just scared, and see a government supporting the bankers, but making the people eat cake.
The only thing I see missing is that this should come with all of the regulations put back in place that were taken away during the last eight years of dumbass, I mean Bush. Also, no more GSE's. Simply a RTC2, then dismantle it once stability is returned to the market. Also a public market, similar to the stock market for mortgages. This way all investors know the value of their investments, like a dividend stock. If housing prices go up, so be it, if they go down, so be it, but at least you stop the panic, and put a floor under the panic selling and forced foreclosures which, like the bubble itself are distorting the market.
There will always be foreclosures and crooks, the problem now is that rational thought and normal risk management are being replaced with greed, fear and forcing people out of their home that really could afford to live there.
Some good ideas Keith, and a lot cheaper, and more directly effective than the gobs of our money the fed and treasury are throwing at the banks "hoping" they will start lending again.
"the only good idea in this post is number 9.
you want to fix housing?
let the fracking prices drop to affordibility...PERIOD!!!"
The problem with that is that "affordability" is objective. I know that here in Phoenix (I know, bubble central) the current home prices are cheap enough, factoring in tax, insurance and maintenance, that they are comparable to a like sized rental. The problem now is that you can't buy because the loan you get approved for today, either is changed tomorrow or the bank decides at the last minute that they are not lending. I have had many friends be told at the closing table that they cannot get financed after all, even though they have high credit and even a 30% down payment. That is ridiculous. That is now why the prices are falling - complete bank disfunction. It is a great market if you have 80% down, but otherwise, you are SOL. Affordability now had very little to do with housing. It also is ultimately, if things don't loosen going to force people to rent, that would ordinarily be able to buy. Not good for rent prices long term, as supply and demand will get all out of whack. How silly it would be to have a bunch of vacant houses, and a supply problem of rental property simply because everyone had to rent. Empty houses, and no where to live - only in America could stupidity get to this point.
How about this:
cut taxes and spending by 25% and let me decide how to spend my own fucking money
too radical huh Qweefie?
I floated (believed to be the first) the tax free withdrawal from 401K about a year ago on another blog. I still believe this to be a significant stimulus.
=====
BULLSHIT
So people who took the 401k option get a tax break at both ends. But people who too the Roth IRA route get nothing.
Stop rewarding stupidity again.
Man, some of you are thick. Must be the McCain voters.
===
Right. Obama voters are too busy protesting for free housing.
http://money.cnn.com/2008/10/29/
real_estate/foreclosure_help.ap
/index.htm?postversion=2008102918
Keith if you vote for Obama, you are a tool plain and simple.
"The US government cannot afford to have houses fall to their natural values"
I'd argue the US government cannot afford to prevent houses from falling to their natural values.
Also, under what circumstances do you think a 90% stock price decline is possible?
It's pretty easy. Make it illegal to walk away from your home. If you walk away, the Fed Gov't will stick you with a huge tax in the form of extraordinary income. That will stop all of the marginal people from walking.
Tom
OKAY ALL OF YOU HP TOOLS OUT THERE, HERE IS THE MOTHER F'IN DEAL!!!!!
ALL INCOME IS TREATED AS ORDINARY, EVERYTHING!!!!!!!!!! NO SPECIAL TREATMENT FOR CAPITAL GAINS OR DIVIDENDS, NOTHING!!!!!!
THE $3,000 CAPITAL LOSS LIMIT IS NOW GONE, IF YOU LOSE YOUR ASS IN THE STOCK MARKET FOR SAY $40,000, YOU GET TO WRITE OFF $40,000!!!!
ALL INTEREST INCOME EARNED FROM BANKS, CREDIT UNIONS, ETC. IS TAX EXEMPT FOR THOSE WHO MAKE LESS THAN $X PER YEAR (TBD). NO SHAREHOLDER/RELATED PARTY INTEREST IS ALLOWED!!!!
SMALL EMPLOYERS (TBD) WILL RECIEVE A 125% OR 150% DEDUCTION FOR ALL WAGES PAID TO NON-OWNER EMPLOYEES!!!!
CORPORATION WILL PAY A FLAT 20% TAX ON ALL TAXABLE INCOME AND ALL LOOPHOLES FOR FOREIGN SOURCE INCOME, ETC., WILL BE CLOSED!!!!
ESTATE TAX RATE WILL BE A FLAT 25% FOR ESTATES OVER $2 MILLION. YOUR FRIGGEN HIPPIES EARNED IT AT A LOW RATE DURING THE GOOD TIMES, NOW IT IS TIME TO PAY THE PIPER!!!!
NATIONAL SALES TAX OF 1/2% - 1% TO GO STRICTLY TO PAYING OFF THE NATIONAL DEBT!!!! WHEN AND IF PAID, THE TAX WILL BE REPEALED!!!!
YOU TOOLS DO NOT UNDERSTAND SOMETHING . . . TRICKLE DOWN ECONOMICS WILL NEVER WORK. IT CREATED A TWO CLASS SYSTEM!!!!
THIS NATION IS ON THE EDGE OF BANKRUPTCY!!!!!
DURING TIMES OF WAR, THE TAX RATE WAS AS HIGH AS 91%!!!!!!!
YET YOU BITCH ABOUT PAYING 35% AS THE HIGHEST RATE?!?!?!?!?!
IF IT IS CAPITAL GAINS YOU ONLY PAY 15%!!!!!
WAKE UP AND SMELL THE JAVA BITCHES, IT IS TIME TO PAY THE PIPER. THE COUNTRY IS NOW IN THE TOILET AND NEEDS TO BE PULLED OUT!!!!
LAST COMMENT, THOSE HIGHEST TAX RATES THAT WERE IMPLEMENTED WERE FOLLOWED BY PROSPERITY!!!
YOU TOOLS!!!
TARDS!!!
DOLTS!!!
DOPES!!!!!!!!!!!!!!!!!!!!
I apologize if someone already suggested this but there are now too many comments for me to read them all.
Here is a big component of the solution:
LEGALIZE MARIJUANA AND TAX THE SHIT OUT OF IT.
Organized crime will never let that happen but it would provide a massive windfall for the IRS and would save a lot of tax dollars that are wasted trying to enforce unenforceable drug laws.
here;s one... raise limit on capital loss deduction to $20,000 sted of the present $3k,
Great pointers Keith! Really critical thinking. However, the main problem with the present Government is that it is reluctant or unwilling to embrace the attitude of change. Hope everything changes with the new Government!
Solutions:
1. Give everyone that did not get a dumb-ass mortgage $20K to buy more crap to prop up the stock market.
These will be the only people that have good credit left to buy a house. Give these people a tax break for buying an REO for cents on the $.
2. Modify existing owner-occ first home loans to 5% fixed (NO adjustment of principal ever!) and extend that bitch out to 60+ years if have to.
This will provide incentive to dad for the kids not inheriting debt and realizing how dumbass dad was in those crazy years of '02-'06.
3. Legalize pot to quell riots. Make it cheap to flush more $$ into the economy. Then, buy stock in snack-food cos.
RE: "Here is a big component of the solution":
LEGALIZE MARIJUANA AND TAX THE SHIT OUT OF IT.
What a great idea, but dont tax it to high, otherwise people will just grow it for free. $19.00 for a 1/4 ounce is a good fair price. The cost to grow and package that amount would be around $1.79. You do the math. (But just remember the alcohol and drug companies would lose sales and their "recreational drugs".)
It would also save America $60 Billion dollars per year (according to 60-minutes)in costs associated with busting people with hash pipes, seeds, joints, jail time, lawyers, court costs, cops, collateral damages, etc., plus the people would be more happy rather than pissed off at the US Gov.
If you dont like it, dont smoke it. It you dont like alcohol, dont drink it. Thats called freedom.
Great ideas Keith! Thanks!
Legalize snuff films featuring bankers, congressmen, and Realtors. Broadcast in High-Def on Pay-Per-View.
Mammoth said:
"Doesn’t 1/3 of taxes going to the schools sound like a lot? That is more than what the state gets, and more than what the county gets! I wonder what the school system is doing with MY money, and how efficiently they are spending it. Teachers sure don’t get CEO pay – where does all this money go?"
__________________________________
I'll tell you where the money goes. Swimming pools, football fields, basketball courts, tennis courts, weight machines, sports equipment, and all the other useless SHIT that no school really needs.
And after all that money, a good number of high schoolers don't know the difference between their, there, and they're? Or then and than.
Makes me sick...
mammoth
"Apologies if firemen are revered as heroes, but how can they possibly be spending 1/5 of MY tax $? What are they spending all this money on?"
It is called "pensions".. And it will bring down many cities, counties and states over the next few years. They are Heroes alright. "Heroes with your tax dollars"..
"THE $3,000 CAPITAL LOSS LIMIT IS NOW GONE, IF YOU LOSE YOUR ASS IN THE STOCK MARKET FOR SAY $40,000, YOU GET TO WRITE OFF $40,000!!!!'
amen to that
WITH ALL THE LOSSES IN PEOPLES PORTFOLIOS. THE IDIOTS AT THE IRS NEED TO RAISE THE CAPITAL GAINS LOSS WRITEOFF . AND PEOPLE SHOULD BE ALLOWED TO WRITE OFF THE ENTIRE LOSS IN ONE OR TWO YEARS . NON OF THE BS $3000 DOLLARS A YEAR FOR THE REST OF YOUR LIFE CRAP.
THIS IS HORSESHIT!! I WANT TO TAKE MY WRITEOFF NOW BEFORE THE DOLLAR IS WORTHLESS
Good ideas but disagree on 10% tax on rents.Have you ever been a landlord? lots of people are losing their ass right now as it is.
---------------------------------
I am a landlord (apartment complexes) and business hasn't been this good in a long time. I have been able to raise rents 5% per year on average the past 2 years and vacancies are running at around 3% max.
You're about to see some serious market intervention and manipulation. You can thank the evil-doers at the NAR and NAHB for that. Just like the $250,000/$500,000 cap gains exclusion and mortgage interest deduction.
The US government cannot afford to have houses fall to their natural values, or for stocks to go down 90%. So they're going to use their powers to artificially stimulate stocks and real estate.
Take that to the bank.
And you think 10% tax on rents is bad? How about 25%? Maybe 50%?
---------------------------
oh, I have been taking it to the bank. the government will try everything to get the consumer spending again and it won't work.
the tax on rents won't happen. it impacts the democrats main constituency, the 40% who don't pay federal income tax. most of those rent.
Right. Obama voters are too busy protesting for free housing.
http://money.cnn.com/2008/10/29/
real_estate/foreclosure_help.ap
/index.htm?postversion=2008102918
Keith if you vote for Obama, you are a tool plain and simple.
----------------------------
they are also busy fire bombing McCain signs and pepper spraying mccain supporters, and hanging palin effigies.
Great pointers Keith! Really critical thinking. However, the main problem with the present Government is that it is reluctant or unwilling to embrace the attitude of change. Hope everything changes with the new Government!
----------------------
OMG i think this guy is serious!
1) Raise the 401k max contribution to $100,000 in 2008, 2009 and 2010
2) Raise the Roth IRA max contribution to $50,000 in 2008, 2009 and 2010
Not bad ideas in general, but I don't think they'll stimulate enough interest in the stock market it to re-bubble it. Two factor working against: one is that few people make enough to max out the current 401K limit, two is that they could still just pour it into the ever present cash equivalents option.
Besides, if this actually worked it could hurt tax revenues. This would cause the government to try and issue more debt to pay for the mess, which I believe would in the end make it worse.
3) Permanently eliminate taxes on savings accounts earnings held in US banks
I like this as well, but it won't make much difference to most people. It doesn't even save me, a saver, enough to be a game changer. This has the same problem with respect to tax revenues.
4) $10,000 immediate tax credit for any home purchased for residence or investment with 10% or more down in 2009 or 2010
I don't think this would help much, especially considering how much this program would cost. We also have to accept that we'll have this tax break forever or it's effects will end as soon as it's repealed, leaving us in the same situation.
5) Offer 40-year 4% fixed rate refinance mortgages to any qualified homedebtor on up to 90% of current appraised value with the government to receive 20% of any gross profit if home is sold
This is one of the better ideas I think. In some form it could pay for itself and we can keep the hamsters on the wheels.
6) Eliminate forced withdrawals from 401k's for 2008, 2009 and 2010
Might help the stock market a little. It will hurt tax collections, of course. Don't see a huge upside here.
7) $5,000 one-per-person matching funds check from the US government good towards the downpayment on any bank-owned or foreclosed home in 2009 or 2010
I dislike this one because there isn't a way for the government to recoup our losses.
8) Allow up to $20,000 to be withdrawn from 401k's tax free in 2009 or 2010 if used toward the purchase of a house with at least 10% down
This doesn't bother me too much, I guess.
9) Arrest Angelo Mozilo, Dick Fuld and Michael Perry
This is probably the only thing in the list that would work for me. I invest and live as outside the system as possible because it's so full of people who sit on a spectrum somewhere between dishonest and felon.
10) Charge a nationwide 10% tax on all rents starting in 2010
Could you explain this one? Could be all the alcohol, but I can't see it doing anything but depressing the price of rents. As the largest monthly cost that most people have, what they have available to spend on it is the most inflexible.
What's my solution? Do nothing at all. Currencies would fail, banks would go out, and businesses would go bankrupt. But in the end, nothing of value would be lost.
I say do nothing and let the housing market correct itself.
Ella is the ONLY person to get it.
This is not a crisis of housing.
This is a tsunami built on the fact that the rich have never been richer.
Can we not all agree that we have a consumer economy?
Then HOW THE HELL CAN A CONSUMER ECONOMY DO WELL WHEN THE CONSUMERS HAVE NO MONEY?!?
Follow Ella's advice. Keith - you have some good starting points - but Ella has it whupped.
realtors have the monopoly provided by the government. government should be able to regulate their salary down to half percent. this would help.
Man, a few of you are truly not smart.
The 10% on rents idea is if the NAR gets to write our laws. What could our government do to stimulate home sales? That's what this list is about, not what I recommend.
Get it? Is this concept too hard to understand?
Taxing the rents would be the only way to make rents rise, and would push people into buying homes - just like the interest write-off or the $250k/$500k cap gains exclusion.
The NAR's PAC runs DC. So watch out.
Hey Kiefer, I sent your ideas to the email 'donate' button I get in my inbox every day from the Obama campain.
Only be a matter of days now.
A rich old lady came in my store ranting about how terrified she is of Obama getting elected, and that Michelle Obama is the one who will destroy the country. She was scared to death and hollering that she hopes he gets shot and there were black ladies in there at the time.
I told her to leave and talked to the black ladies and they said everyone is entitled to their opinion and were very kind.
But I woke up this morning with this strange sense of foreboding that I'm trying to shake off.
That Barak is some kind of catalyst for something awful happening, and he and the majority of people are totally unaware of it. I don't know exactly what it is. The sun is ccoming up now, and it doesn't seem as scary, but it's like black hate crimes will be directed at whites or something..I don't know. But there is something stirring deep, like a tornado beginning to form.
BULLSHIT
So people who took the 401k option get a tax break at both ends. But people who too the Roth IRA route get nothing.
Stop rewarding stupidity again
*******
Are you suggesting contributing to a 401K is stupidity?
How do you get a tax break at both ends? More likely you pay more tax by the time we get to redemption.
Why am I responding to incoherent comments from an anonymous poster?
1& 2) Wouldn't raise enough to be worth it as people don't have that kind of money in their 401Ks. Furthermore, I fully expect Obama to confiscate the 401Ks under some nebulous "save the pensions act" which will make it impossible to get your money out of the 401Ks. Anybody with a grain of sense already took the 10% penalty and withdrew his/her savings if he/she was in a position to do so.
3-8) Reasonable suggestions.
9) Wouldn't help, but whatever.
10) Stupid. This would just get charged to the renter.
Why don't we just let the free markets work, without govt interference...
problem IS WE DO NOT HAVE FREE MARKETS ANYMORE..
WE HAVE CORRUPT MARKETS run by scam artists and the mafia
10% tax on rents is absolutely a bad idea. It may not hurt for some people but for those who earn their living from rents especially those who are old age and adults will have a bad time. Think about them!!
Tax churches.
Legalize pot.
Make it more difficult to move wealth and assets to offshore tax havens.
Leave rent alone, tax-wise, but abolish rent control & socialized housing. If someone wants a free/cheap house they can have on in one of the abandoned suburbs, but are not entitled to subsidies in the downtown core of any large, expensive city.
In the long run, house prices are a function of incomes. You can do all the things on your list and more, but if people dont get higher salaries, house prices must come down. One way to increase salaries is to increase productivity, but that means work and patience. Inflation is another, but that means many bad things.
We already have a tax on rents. It is called INCOME TAX.
Sheesh.
Well now that Democrats have introduced a bill to abolish the 401k, your proposals are obsolete.
All Democrats should hang for treason. Period. End of story.
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