Myth Vs. Reality
One of the selling points for tax cuts for the upper 2% is that they will invest the extra money and businesses will expand.
Back on September 13, 2010 Timothy R. Homan of Bloomberg wrote that Rich Americans Save Tax Cuts Instead of Spending, Moody’s Says
Give the wealthiest Americans a tax cut and history suggests they will save the money rather than spend it.
Tax cuts in 2001 and 2003 under President George W. Bush were followed by increases in the saving rate among the rich, according to data from Moody’s Analytics Inc. When taxes were raised under Bill Clinton, the saving rate fell.
They aren’t spending or investing the tax cuts, they are “stuffing the money in their mattresses”, a lot of this in the form of Treasury bills. They don’t listen to the pundits that are always wrong, or to fools like Greenspan, who was shocked to discover that the financial sector was filled with a greedy criminal class, they made their money and keep it by paying people to tell them what is really happening. They know that they will greatly increase their real assets by hoarding money in the face of the coming deflation. They are also funding the propaganda about the threat of inflation to dump their inflation hedges, like gold and art, things they intend to buy back after the prices tank.
Selling high and buying low is just as good as the normal way it is expressed. No matter which order you do it in, you make money.
4 comments
Nicely done.
Too bad others don’t put two and two together so easily.
It actually hasn’t been a mystery for almost three decades as to what the rich do to increase their net worth.
Maybe the middle class will finally figure this out?
That is, unless another ass captures their attention on the boob tube first.
Kudos for your efforts!
S
They aren’t spending or investing the tax cuts, they are “stuffing the money in their mattresses”, a lot of this in the form of Treasury bills. They don’t listen to the pundits that are always wrong, or to fools like Greenspan, who was shocked to discover that the financial sector was filled with a greedy criminal class
__________________
Always follow the money. That’s how you find out what’s really going on and who is calling the shots.
People don’t seem to understand that Wall Street makes it money from transactions, so it doesn’t really care whether the market goes up or down, only that it changes, which means people are buying and selling. There is nothing a broker hates more than people who actually invest, i.e. they buy a stock and put the certificates away for years, rather than leaving them with the broker so they can be sold quickly. They don’t need the computers to invest, they need them to gamble.
ROFL! You provide the neocon with evidence that the sky is blue (or that the rich are saving their money in below-0% Treasuries rather than spending it), and he *still* insists that your lying eyes are wrong because actual empirical measured reality contradicts the theology of his Austerian faith! f this were the days of Galileo, he’d be one of the guys lined up to condemn Galileo for saying that the Earth went around the Sun rather than vice-versa. Those guys had plenty of theological religious BS on their side that the Earth was the immobile center of the universe. Yet every piece of data says it moves (as Galileo is incorrectly reputted to have muttered upon being forced to recant upon threat of burning at the stake).
The reality is that the rich have been primarily “saving” their money by creating one asset bubble after another for the past 30 years, ever since Saint Ronny Raygun freed them from having to, like, pay actual *taxes* on their ill-gotten gains. And average hourly wages have been flat or declining ever since. Funny how that works, eh? But oh wait, I’m talking about actual measurable empirical facts here, none of which apply when faith in Austerian theological orthodoxy is the only thing that counts :twisted:.
– Badtux the Snarky Penguin
Right in one, Badtux – it isn’t knowledge, it is belief. No matter how many times it fails, they will insist on doing again and again.
It will be put down as our lack of belief in Austerity that caused it fail. If only we had clapped louder, it would have worked this time. There is always an excuse because it is holy writ brought up from the depths by Ayn, the naiad of Lake Michigan, and revealed to the profit… prophet Friedrich von Hayek.
Zero lower bound has no meaning in their universe, nor the paradox of thrift. Keynes is the devil who must be avoided and demand need never be considered.