Obama: No more debates before May 6th

[snoopy369]

Enough with the name calling please...

[Ogie Oglethorpe]

Snoop I'm done. Certainly won't happen with that individual again.

[Ogie Oglethorpe]

Originally posted by Kidicious


You don't really expect democrats to believe in the lapher curve do you?

Course I do. I expect everyone to believe in the laffer curve. Where one sits on the curve regarding the optimum revenue is a matter of opinion.

[Kidlicious]

Originally posted by Ogie Oglethorpe


Course I do. I expect everyone to believe in the laffer curve. Where one sits on the curve regarding the optimum revenue is a matter of opinion.

The laffer curve is a joke. The democrats are the party for intelligent people remember. Only republicans will believe in something so silly at this point. Not even swing voters are stupid enough to listen to that crap.

[Ogie Oglethorpe]

OK. 0% taxation means 0 revenue likewise 100% taxation means 0 revenue. So somewhere is an optimum, no? Its a continuum so somewhere exists an optimum in the function at a given time and economic backdrop. Whats not to believe other than whether one thinks one is to the left or right of the optimum?

BTW continuum does not imply a given single maximum or simple smooth curvalinear function.

[Kidlicious]

Originally posted by Ogie Oglethorpe
Whats not to believe other than whether one thinks one is to the left or right of the optimum?

It's fairly ridiculous to ask the question in all real situations. In a model it looks acceptable if you ignore reality and common sense completely.

Can you explain to me why someone would not trade a very significant about of stocks just because the tax rate were 28% instead of 15%? It's pretty absurd.

[Ogie Oglethorpe]

Originally posted by Kidicious


It's fairly ridiculous to ask the question in all real situations. In a model it looks acceptable if you ignore reality and common sense completely.

Perhaps, its akin to asking how many angels dance on a pinhead. Everyone ends up with an opinion about what is best without provable evidence. Save historical evidence that by its very nature means little for predicting best future courses of action. Doesn't mean that optimums do indeed exist just that its nigh impossible to predict where they are and where we are in relation to them.

Can you explain to me why someone would not trade a very significant about of stocks just because the tax rate were 28% instead of 15%? It's pretty absurd.

Why would they assume the risk of equities markets and instead go for something safer that approximates the same after tax returns without the risk?

[Kidlicious]

Originally posted by Ogie Oglethorpe
Perhaps, its akin to asking how many angels dance on a pinhead. Everyone ends up with an opinion about what is best without provable evidence. Save historical evidence that by its very nature means little for predicting best future courses of action. Doesn't mean that optimums do indeed exist just that its nigh impossible to predict where they are and where we are in relation to them.

But raising taxes always raises revenues unless either there is some specific reason or taxes are very high. And the second case is only hypothetical.

Why would they assume the risk of equities markets and instead go for something safer that approximates the same returns without the risk?

They will be taxed either way. So what it comes down to more than the tax is the return on the investment. And that's what Obama said.

[Ogie Oglethorpe]

Originally posted by Kidicious


They will be taxed either way. So what it comes down to more than the tax is the return on the investment. And that's what Obama said.

No rate of return after taxes balanced vs. risk is where the money flows to. And much of the risk component is tied to the state of the economy as well.

As for what Obama said, I agree with his premise taxation rate in order to maximize gov income is akin to tarot card reading. Which then goes to his main point that his rationale for the tax is all about the fairness (even if he gets his policy wrong).

[Ogie Oglethorpe]

Originally posted by Kidicious

They will be taxed either way. So what it comes down to more than the tax is the return on the investment. And that's what Obama said.

And less riskier investments as a generalization mean less appreciable growth meaning less tax revenue.

[Patroklos]

In a model it looks acceptable if you ignore reality and common sense completely.

You are a communist, right?

[Imran Siddiqui]

[Kidlicious]

Originally posted by Ogie Oglethorpe
No rate of return after taxes balanced vs. risk is where the money flows to. And much of the risk component is tied to the state of the economy as well.

According to a recent study a lot of it has to do with whether or not a man has a boner or not. Regardless the tax rate doesn't have much to do with the expectations of the investments which earn capital gains. A lot of the expectations have to do with whether or not people are sexually aroused or not. There's not as much rationalizing as you are putting into it.

As for what Obama said, I agree with his premise taxation rate in order to maximize gov income is akin to tarot card reading. Which then goes to his main point that his rationale for the tax is all about the fairness (even if he gets his policy wrong).

He never said it's all about fairness. You are totally wrong on that.

[Ogie Oglethorpe]

Originally posted by Kidicious

He never said it's all about fairness. You are totally wrong on that.

I'm not going there again despite the provided quote.

[snoopy369]

Kid, this is very simple.

Probable return = (Potential net gain)*(Chance of said gain)

You'd agree to that, right? It's massively simplified of course, but that's the basic concept.

Potential Gain = (Potential gross gain)-(Tax)

So, increasing tax reduces potetnial gain.

Take a base of $100, potential gross gain of $20, percent chance is 60%, tax is $5 (25%).

Return = ($20-$5)*.6 = $9

Put it in the bank, you get 6% interest after tax, let's say, so $6.

Increase tax to 50% ($10), and now you have
($20-$10)*.6 = $6

At this point you are just as well off putting it in the bank.

Now, increase the risk, and decrease the percent gain chance to 40%. Now at 25% you have $20-$5=$15*.4 = $6. Again, equal to the bank. At 50% you have $10*.4 or $4, less than the bank. Again, massively simplified, but the concept holds.

In times of increased risk, high capital gains taxes are very detrimental to investment - with very high risk, the taxes are effectively magnified, as they lower the potential gain while not adequately lowering the potential loss (you don't get money back if you net lose for the year beyond your tax burden, as far as I know; so the loss on the upside is more than the gain on the downside). Hence, CG tax hampers investment after a certain point; and that point goes down with the economy. I'd almost suggest giving the Fed power over (some of) the CG tax, because lowering/raising it has a similar effect to raising/lowering the interest rate... and perhaps is a safer mechanism.