Thrill A Minute Thursday: Will The Bernanke Bounce Hold? [View article]
I wouldn't want to make a short-term guess but we're very comfortable with the value down here, especially as we're hedging them down to below $4 so I hope the guys buying at $6 were correct - we only need them to hold $5 to make good money.
Thank GDP It's Friday: Reality Check? [View article]
My note to Members on the currency action this afternoon:
78.73! Yen down to 80.39 and EUR/CHF still $1.201. It's amazing. All a fund has to do is keep dumping Francs, which is not very expensive as they already told you they'd support $1.20 so you can sell them in bulk and won't lose more than a penny. That then keep the SNB buying Euros – which no single fund could afford to support on their own and the Euros cause the Dollar to fall and that's how you can lose maybe $10M dumping $1Bn worth of Swiss Francs and cause the World's 2nd largest currency to move up 1% in a day while the World's largest currency drops 1% where either move can turn another Billion into $1.2Bn easy.
Switzerland sparked fears of a new currency war on Tuesday after it pegged the Swiss franc against the euro in an attempt to protect its economy from the European debt crisis.
The Swiss National Bank in effect devalued the franc, pledging to buy "unlimited quantities" of foreign currencies to force down its value. The SNB warned that it would no longer allow one Swiss franc to be worth more than €0.83 – equivalent to SFr1.20 to the euro – having watched the two currencies move closer to parity as Switzerland became a "safe haven" from the ravages of the eurozone crisis.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
It's interesting that recent comments in this post mirror our ongoing conversation in Member Chat. I will write a whole article about this one day but here's part of today's exchange on the subject of work and the middle class etc.
zeroxzero (premium)
Phil: I have always been intrigued by your notion that many, not to say most, people don't need to work. A kind of "Jetsons" world where machines scurry around taking care of most things [of course, they become conscious at some point and take over, but that's a bit down the road].
But what would they do? There's nothing more destructive than a bored monkey — I had one, trust me. These are not the "Denker und Dichter" of society — they are, or will be, the "Betas" of Brave New World. Given time — it's probably already taking place — this will take on a permanent genetic aspect. Perhaps that is, and has always been, evolution's path. But my guess is that it's not what you had in mind.
Phil
Bored monkeys/ZZ – That's just your own prejudice about what constitutes "worthwhile" pursuits. They had a similar problem in ancient Athens as a combination of military conquests, trading by sea and the beginnings of craft "workshops" powered by slaves left most of the population with nothing much to do other than supervise slaves. Since there was no regular work for young Athenians who didn't want to be in the army, the state paid one Drachma per day (a decent amount) for anyone who did anything which included being an artist or a musician or a philosopher or a teacher or a performer – you had to actually work but it was whatever you felt like doing and it was a golden age that led to a large percentage of humanity's cultural and technological advances up to that point.
Only because you don't value the common man do you not see the tremendous potential in simply letting millions of people pursue their own interest. People working on an assembly line or mopping floors 8 hours a day and getting paid only enough to make their minimum credit card payments are not very likely to solve the energy crisis but, as they say, if you give a million monkeys a million typewriters to play with – eventually you'll get all the works of Shakespeare out of them – we've devalued people and created an elitist society where only people who make money are perceived as having "value" – it's BS but it's going to be a long time before we can re-educate our population (look at you, you are turning your nose up as you read this!) to value "non-productive" pursuits like art, science, philosophy, education for it's own sake (not so you can learn to perform a function), etc.
flipspiceland (premium)
@Felipe We have had many disagreements about, mainly, politicians, but I have been writing and saying the same things for 20 years about exactly the point you are attempting to make that there just isn't enough work (that mankind has yet invented) for the people to do, at meaningful production. I know this because of my former life as an Exec Recruiter.
I roughly calculated that there is 1/4 of a job to be done by each of the 6-7 billion people on this planet. We theoretically could do ALL the work to be done with 3/4 less people. It's an exaggeration since that would mean full employment, everyone working, which realistically would never happen. But the point still remains.
There have to be people in government who recognize this and have for a very long time. There must be think tanks that can demonstrate the futility of an economy based solely on producing something in order to live, survive, and maybe even prosper. The mystery to me is why a loud mouthed politician like Ron Paul, for instance, won't tell this significant truth. He has nothing to lose. Everything to gain by saying it out loud: The U.S. Government— elected and appointed officials must begin the drumbeat for a different paradigm, figuring out a way to get into the hands of people what they need to live on, to have them NOT to enter the workforce, those that are not able to be trained, don't want to be trained in something they cannot do well, a hundred million people just in the United States eventually, that could be given vouchers, other currency, or means to live out their lives as they choose if they cannot meet the demands of production as it now stands.
In your next appearance on some TV program, maybe you could open up this Pandora's box once and for all to at least let loose those demons that need be tamed, the ones that say you must produce something in order to live.
We are in the post-work world and hundreds of millions of people do not seem to understand it.
Kurt Vonnegut was right.
Phil:
Wow Flips – I agree with you 100%. I think we should have this post bronzed. You're right, I should say something next time unemployment is an issue of we have some excuse for it. I have one daughter who wants to be an artist and one who wants to be an actress and both are pretty good and both are honors students but it would be nice if I could tell them that those were realistic pursuits that they can concentrate on since it makes them happy but we have to be "realistic" and make sure they have a career to fall back on – how sick is our society that being an artist or an actor is not a legitimate career (only for the top of the top, of course)?
Quotes from Vonnegut:
What should young people do with their lives today? Many things, obviously. But the most daring thing is to create stable communities in which the terrible disease of loneliness can be cured.
The feeling about a soldier is, when all is said and done, he wasn't really going to do very much with his life anyway. The example usually is: he wasn't going to compose Beethoven's Fifth.
Human beings will be happier – not when they cure cancer or get to Mars or eliminate racial prejudice or flush Lake Erie but when they find ways to inhabit primitive communities again. That's my utopia.
True terror is to wake up one morning and discover that your high school class is running the country.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
Yes people cheat the system (very doubtful as many as you think). One way to fix this is to give MORE MONEY to the safety net to allow adequate staff to eliminate waste. By defunding Government, you create inefficiencies that are then used to justify defunding Government.
It's the same as cutting NASA's budget 12 years in a row and then saying "well, what do they ever accomplish?" Our military record sucks but we keep putting money into that for some reason...
If your test of whether something is worth doing is based on whether or not the system can be abused - then I'd say Capitalism in General must be stopped immediately and I very much doubt you need examples of abuse there.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
That's why we need an expert like you to make it work! The trick is to break a job up into component parts and find the parts that can be done off-site and cheaply. If you can do a "final read" after the grunt work is completed for you - that could be good. Anyway, just an idea - no one likes to think they can be replaced by machines or outsourced but, if you can find a way to make 10 people like yourself 20% more productive by outsourcing or automating part of the job - then you have something of real value.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
LOL - You really think that? That's too funny. That's the false premise behind market valuations that lead to a crash. PCLN, for example, isn't worth $36Bn just because 1M shares traded for around $720 yesterday - that's just $720M and that was buying AND selling so the net imbalance, one way or the other is about 5% or $36M or 1/1,000th of the Market Cap.
Just because there are SOME idiots willing to pay $720 for the stock on any given day DOES NOT mean they can sell all 500M shares for $720 - it's paper profits. This is why we crashed in 2008 and this is why we'll crash again - there's not enough REAL money in the system to support the valuations of the stocks.
I wish I had time now but we've discussed this in posts before - the net cash flow into the markets over the past two years has been minimal but the PRICE of stocks has gone from $22Tn to over $40Tn - it's a BS valuation. Housing was the same problem bubble - that is not wealth creation - those are valuation imbalances and, sadly, you are not the only person who doesn't know the difference - I doubt many people in Congress get it either.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
I love all the anecdotal "evidence" - those so-called poor people are just a bunch of scammers, right?
My friend’s husband died and she never had a job as she got married right out of law school and he provided for her and they decided to have kids (3 – a good, Conservative number) and the little one is 2 and the others are 5 and 7.
They had about $100,000 cash saved up (age 38) and $100,000 in equity on a $400,000 home and his life insurance paid $250,000 (they meant to get more but never got around to it). Her living expenses are about $4,000 a month so she’s going to sell the home in a bad market for $300,000 and she’ll have about $350,000 left to start a new life – much better shape than most who are in that situation but now she’s going to have to start paying $1,500 a month for health care ($18,000 a year) and if she goes to get a job it’s going to cost her another $20,000 in child care a year so if she can’t make $20,000 take home it doesn’t pay for her to leave the house and she’ll need at least $50K to move back into a modest home but, SURPRISE, she can’t do that because she has no job.
It’s even hard for her to rent now with no job and 3 kids. She’s making all the right choices to scale back, given her situation but there is adversity at every turn and her kids will now never get the quality of education she had planned and, the cold, hard fact is, unless she finds a guy who wants her and her three kids, the chance of her being ready to send them all to college over the next 15 years is not very likely.
There's a person who's just screwed by the system. She has too much money to be poor enough for aid. She just "made the wrong choices in life" (should have picked a husband who drove better, should have had less kids, should have had a job), right?
And there are, of course, people far worse off than that. When I had a company we were very pro-active in helping our employees get their lives going with home loans and advances when they needed them and I found that very small boosts early in life (like contributing $20K for a deposit on a first home, helping out with expenses, providing day care, health care, etc.) went miles towards helping people get a firm footing in life.
I found it was not only immensely satisfying to do things like that for my people but it also worked to our benefit as we had a loyal, family-like atmosphere in the company. When you talk about there once being 1 in 10 people qualified for management and now 1 in 100 - I had no problem getting 1 in 10 because I understand that, first and foremost, you need to allow your employees to relieve themselves of the constant worries about money that plague 99 out of 100 these days.
Why do you think GS starts people at $150K? When someone comes to work you want them to focus on work, not sitting there wondering if they can make the rent or pay for their kids' braces. Universal Health care is vital as that is most people's biggest burden but paying people living wages is also important and living wages in America are simply much more than other countries, which is why we need a tax system that encourages a more even distribution of wealth.
The evil of the current system of distribution of wealth is the LACK of distribution. Of course you don’t see that when you are in the deep end of the distribution pool, but I think you'd appreciate this since you say you fell out of it:
10,000 people make 30% of the income in the United States of America and the next 29.99M people make another 40% and the next 30M people make 12% and THE OTHER 240M people have to fight over the remaining 18%.
Table 1 has 10,000 people who have $1M each to play with Table 2 (top 10-0.01%) has 30M people who have $433 each to play with Table 3 (top 20-10%) has 30M people who have $133 each to play with Table 4 (bottom 60%) has 240M people who have $25 each to play with.
What are the chances of someone from the lower tables winning enough money to compete at table 1? First of all, the only way to advance is to take money away from other, that should be obvious.
Second of all, even if someone from table 2 accumulates the wealth of 1,000 people (who are nocked down to table 4 or out of the tournament entirely), they are still at a huge disadvantage once they have to move up to table 1 and, of course, what effectively happens is the person from the lower table who accumulates the wealth of his neighbors and takes his winning up to table one – if often swatted back down to nothing as the more experienced, better funded players at the big table make short work of him.
What’s the net effect? The money that our lucky/skillful player from the lower tables takes from his fellow players in the lower ranks is either left on table one and added to their very eclusive wealth poor or, failing to wipe out the new guy, they may reluctantly make room for another seat at the table and chant "One of us" at the initiation ceremony but, what they WON’T do, is put that money back into circulation in the lower tables – the tournament just isn’t designed to work that way is it?
Evenually, invevitably, when you design a system like that and you refuse to redistribute the wealth back from top to bottom – there can be only one winner in the end but, as I’ve been saying, it’s a long, slow game that grinds away for decades and the money goes up and up the ladder and is a long, painful death for those down below, who don’t even realize what they are losing until there’s nothing they can do about it.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
I hate to tell you Moz but here's a site to help hospitals outsource their radiology to India: http://bit.ly/GW7UyL
On the bright side, here's an MIT study that concludes "Radiology is an “extreme” professional service with extensive usage of tacit rather than codified knowledge. The importance of tacit knowledge leads to long training periods, a limited global supply of radiologists and heavy government regulation, all of which are obstacles to a “flat world”. Computerization of low-end diagnostic radiology ultimately poses a bigger threat to the profession than offshoring."
Frankly, if you are a motivated guy, I'd be looking into the entrepreneurial side of this and seeing if you can, in fact, build an off-shore service that comes up to quality standards and then use your contacts to build an outsource shop in the US. If you can have 40 Indian Doctors billing $250K a year who you pay $150K a year, then you make $4M, which is a damned sight better than $500K....
Hell, if I had time, I bet I could find investors for this real fast!
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
You have a good point. What we do not put a proper value on, silly as it seems, is the ability of Americans to consume. We are, by and large, the biggest consumers on the planet - we are very desirable customers and people should pay to have access to our market.
US companies talk about going to China, where they play numbers games for fantasy sales but who besides Americans are going to gobble them up like Americans? We have just 300M people (5% of Global population) yet we bought 58% of the World's Iphones and Ipods in 2009 (only one I could find): http://on.mash.to/Hj8niN
If someone wants access to our psychotic consumers, they should pay for the privilege, but instead we provide tax breaks to corporations who then outsource jobs and weaken our consumers - MADNESS!
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
No thanks Bevo - to affect real change that begins to stop you from being a Randian joke, it's good for me to occupy a position of stature. I know you want everyone who disagrees with you to go away - can't stand the competition I suppose.
Your incredibly poor grasp of economics really stuns me though, I guess you are one of those that lucked into or inherited wealth and now think you are better than everyone else because people who earn their money, even without a good education, generally grasp the basics of supply and demand.
There is a supply of money, only so much is generally created in a year. If 1% of the people get all the money that is created, that means that someone making Billions does, IN ACTUAL FACT, impact your ability to make Billions. It's just that there is so much money around that there is still not a major barrier against your individual effort but your Billion (as if!) would then deprive 1,000 other people of $1M etc.
Unless you are Ben Bernanke - nothing you do will increase the amount of available money. There will be people who get some and people who lose some and - as MOST people can clearly see from the Decade chart above - it's a pretty ABSOLUTE relationship that money taken by the top 1% is taken FROM the bottom 90%.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
Well that's why we need to overhaul the education system and provide adequate nutrition and child-care programs for our young people of all classes - but that's a whole different issue, although treating our Nation's human resources like they were expendable/outsourcable is one of the reasons we are in this mess and why there are not going to be any quick fixes.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
Since you asked - this seems to be your problem, you are unable to analyze a business situation. The article indicates that his real problem is he offers unsteady work and pays so little (for an SAT tutor) that he quickly loses employees who are able to strike out on their own and bypass his middle-man operation to go into business for themselves.
In fact, this is the exact opposite of the point you are trying to make as this guy, unintentionally, is wildly successful at turning people into entrepreneurs. His problem is that his business model isn't proprietary enough to protect and he attempts to take too big of a cut to make it worth it for people to have him find clients, rather than him doing it for them.
The next guy wants to pay minimum wage for skilled labor at off hours and he's really smart as his alternative is "We could raise wages to $100 an hour, fill the positions and then go out of business, taking all our jobs with us." Gosh, I wonder if we can teach him that there are 91 perfectly good wage levels between $8.50 and $100?
The next girl has the same problem but at least she realizes it and has begun paying better wages and investing in training - now she's able to expand. Isn't that amazing - pay people well and they build your business and you make more money! Don't tell anyone, it might ruin capitalism....
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
So that's $18.5Tn for the top 1.4M people = $13M each. Are you suggesting a "clawback" tax to take $16Tn away and leave them with just $1.1M each? That seems mean.
Of course, when we talk about the top 1%, we tend to forget our Corporate Citizens - the ones that pay an average of 12% in taxes ($198Bn last year).
What we really need is a VAT-type tax going forward that eliminates all the loopholes and simply collects a percentage of economic activity. A 20% VAT on all goods and services in a $16Tn GDP would collect $3.2Tn a year - that would pretty well cover the entire budget without the need for any income tax. Then if we DROP income tax rates by 60% and collect another $1Tn a year and keep Government spending under $3Tn, we could pay off our debt in 15 years - faster if the GDP grows.
No more loopholes, no more deductions - if you buy something, it's simply 20% more expensive and if you earn something - you pay perhaps 15% on that if you earn over $50,000 a year. There's the debt crisis solved with lower tax rates.
Thrill A Minute Thursday: Will The Bernanke Bounce Hold? [View article]
Thank GDP It's Friday: Reality Check? [View article]
78.73! Yen down to 80.39 and EUR/CHF still $1.201. It's amazing. All a fund has to do is keep dumping Francs, which is not very expensive as they already told you they'd support $1.20 so you can sell them in bulk and won't lose more than a penny. That then keep the SNB buying Euros – which no single fund could afford to support on their own and the Euros cause the Dollar to fall and that's how you can lose maybe $10M dumping $1Bn worth of Swiss Francs and cause the World's 2nd largest currency to move up 1% in a day while the World's largest currency drops 1% where either move can turn another Billion into $1.2Bn easy.
Thank GDP It's Friday: Reality Check? [View article]
http://bit.ly/IhifLx
Switzerland sparked fears of a new currency war on Tuesday after it pegged the Swiss franc against the euro in an attempt to protect its economy from the European debt crisis.
The Swiss National Bank in effect devalued the franc, pledging to buy "unlimited quantities" of foreign currencies to force down its value. The SNB warned that it would no longer allow one Swiss franc to be worth more than €0.83 – equivalent to SFr1.20 to the euro – having watched the two currencies move closer to parity as Switzerland became a "safe haven" from the ravages of the eurozone crisis.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
zeroxzero (premium)
Phil: I have always been intrigued by your notion that many, not to say most, people don't need to work. A kind of "Jetsons" world where machines scurry around taking care of most things [of course, they become conscious at some point and take over, but that's a bit down the road].
But what would they do? There's nothing more destructive than a bored monkey — I had one, trust me. These are not the "Denker und Dichter" of society — they are, or will be, the "Betas" of Brave New World. Given time — it's probably already taking place — this will take on a permanent genetic aspect. Perhaps that is, and has always been, evolution's path. But my guess is that it's not what you had in mind.
Phil
Bored monkeys/ZZ – That's just your own prejudice about what constitutes "worthwhile" pursuits. They had a similar problem in ancient Athens as a combination of military conquests, trading by sea and the beginnings of craft "workshops" powered by slaves left most of the population with nothing much to do other than supervise slaves. Since there was no regular work for young Athenians who didn't want to be in the army, the state paid one Drachma per day (a decent amount) for anyone who did anything which included being an artist or a musician or a philosopher or a teacher or a performer – you had to actually work but it was whatever you felt like doing and it was a golden age that led to a large percentage of humanity's cultural and technological advances up to that point.
Only because you don't value the common man do you not see the tremendous potential in simply letting millions of people pursue their own interest. People working on an assembly line or mopping floors 8 hours a day and getting paid only enough to make their minimum credit card payments are not very likely to solve the energy crisis but, as they say, if you give a million monkeys a million typewriters to play with – eventually you'll get all the works of Shakespeare out of them – we've devalued people and created an elitist society where only people who make money are perceived as having "value" – it's BS but it's going to be a long time before we can re-educate our population (look at you, you are turning your nose up as you read this!) to value "non-productive" pursuits like art, science, philosophy, education for it's own sake (not so you can learn to perform a function), etc.
flipspiceland (premium)
@Felipe
We have had many disagreements about, mainly, politicians, but I have been writing and saying the same things for 20 years about exactly the point you are attempting to make that there just isn't enough work (that mankind has yet invented) for the people to do, at meaningful production. I know this because of my former life as an Exec Recruiter.
I roughly calculated that there is 1/4 of a job to be done by each of the 6-7 billion people on this planet. We theoretically could do ALL the work to be done with 3/4 less people. It's an exaggeration since that would mean full employment, everyone working, which realistically would never happen. But the point still remains.
There have to be people in government who recognize this and have for a very long time. There must be think tanks that can demonstrate the futility of an economy based solely on producing something in order to live, survive, and maybe even prosper.
The mystery to me is why a loud mouthed politician like Ron Paul, for instance, won't tell this significant truth. He has nothing to lose. Everything to gain by saying it out loud: The U.S. Government— elected and appointed officials must begin the drumbeat for a different paradigm, figuring out a way to get into the hands of people what they need to live on, to have them NOT to enter the workforce, those that are not able to be trained, don't want to be trained in something they cannot do well, a hundred million people just in the United States eventually, that could be given vouchers, other currency, or means to live out their lives as they choose if they cannot meet the demands of production as it now stands.
In your next appearance on some TV program, maybe you could open up this Pandora's box once and for all to at least let loose those demons that need be tamed, the ones that say you must produce something in order to live.
We are in the post-work world and hundreds of millions of people do not seem to understand it.
Kurt Vonnegut was right.
Phil:
Wow Flips – I agree with you 100%. I think we should have this post bronzed. You're right, I should say something next time unemployment is an issue of we have some excuse for it. I have one daughter who wants to be an artist and one who wants to be an actress and both are pretty good and both are honors students but it would be nice if I could tell them that those were realistic pursuits that they can concentrate on since it makes them happy but we have to be "realistic" and make sure they have a career to fall back on – how sick is our society that being an artist or an actor is not a legitimate career (only for the top of the top, of course)?
Quotes from Vonnegut:
What should young people do with their lives today? Many things, obviously. But the most daring thing is to create stable communities in which the terrible disease of loneliness can be cured.
The feeling about a soldier is, when all is said and done, he wasn't really going to do very much with his life anyway. The example usually is: he wasn't going to compose Beethoven's Fifth.
Human beings will be happier – not when they cure cancer or get to Mars or eliminate racial prejudice or flush Lake Erie but when they find ways to inhabit primitive communities again. That's my utopia.
True terror is to wake up one morning and discover that your high school class is running the country.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
It's the same as cutting NASA's budget 12 years in a row and then saying "well, what do they ever accomplish?" Our military record sucks but we keep putting money into that for some reason...
If your test of whether something is worth doing is based on whether or not the system can be abused - then I'd say Capitalism in General must be stopped immediately and I very much doubt you need examples of abuse there.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
Just because there are SOME idiots willing to pay $720 for the stock on any given day DOES NOT mean they can sell all 500M shares for $720 - it's paper profits. This is why we crashed in 2008 and this is why we'll crash again - there's not enough REAL money in the system to support the valuations of the stocks.
I wish I had time now but we've discussed this in posts before - the net cash flow into the markets over the past two years has been minimal but the PRICE of stocks has gone from $22Tn to over $40Tn - it's a BS valuation. Housing was the same problem bubble - that is not wealth creation - those are valuation imbalances and, sadly, you are not the only person who doesn't know the difference - I doubt many people in Congress get it either.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
My friend’s husband died and she never had a job as she got married right out of law school and he provided for her and they decided to have kids (3 – a good, Conservative number) and the little one is 2 and the others are 5 and 7.
They had about $100,000 cash saved up (age 38) and $100,000 in equity on a $400,000 home and his life insurance paid $250,000 (they meant to get more but never got around to it). Her living expenses are about $4,000 a month so she’s going to sell the home in a bad market for $300,000 and she’ll have about $350,000 left to start a new life – much better shape than most who are in that situation but now she’s going to have to start paying $1,500 a month for health care ($18,000 a year) and if she goes to get a job it’s going to cost her another $20,000 in child care a year so if she can’t make $20,000 take home it doesn’t pay for her to leave the house and she’ll need at least $50K to move back into a modest home but, SURPRISE, she can’t do that because she has no job.
It’s even hard for her to rent now with no job and 3 kids. She’s making all the right choices to scale back, given her situation but there is adversity at every turn and her kids will now never get the quality of education she had planned and, the cold, hard fact is, unless she finds a guy who wants her and her three kids, the chance of her being ready to send them all to college over the next 15 years is not very likely.
There's a person who's just screwed by the system. She has too much money to be poor enough for aid. She just "made the wrong choices in life" (should have picked a husband who drove better, should have had less kids, should have had a job), right?
And there are, of course, people far worse off than that. When I had a company we were very pro-active in helping our employees get their lives going with home loans and advances when they needed them and I found that very small boosts early in life (like contributing $20K for a deposit on a first home, helping out with expenses, providing day care, health care, etc.) went miles towards helping people get a firm footing in life.
I found it was not only immensely satisfying to do things like that for my people but it also worked to our benefit as we had a loyal, family-like atmosphere in the company. When you talk about there once being 1 in 10 people qualified for management and now 1 in 100 - I had no problem getting 1 in 10 because I understand that, first and foremost, you need to allow your employees to relieve themselves of the constant worries about money that plague 99 out of 100 these days.
Why do you think GS starts people at $150K? When someone comes to work you want them to focus on work, not sitting there wondering if they can make the rent or pay for their kids' braces. Universal Health care is vital as that is most people's biggest burden but paying people living wages is also important and living wages in America are simply much more than other countries, which is why we need a tax system that encourages a more even distribution of wealth.
The evil of the current system of distribution of wealth is the LACK of distribution. Of course you don’t see that when you are in the deep end of the distribution pool, but I think you'd appreciate this since you say you fell out of it:
10,000 people make 30% of the income in the United States of America and the next 29.99M people make another 40% and the next 30M people make 12% and THE OTHER 240M people have to fight over the remaining 18%.
http://bit.ly/H3rBb1
Let’s say it’s a poker tournament:
Table 1 has 10,000 people who have $1M each to play with
Table 2 (top 10-0.01%) has 30M people who have $433 each to play with
Table 3 (top 20-10%) has 30M people who have $133 each to play with
Table 4 (bottom 60%) has 240M people who have $25 each to play with.
What are the chances of someone from the lower tables winning enough money to compete at table 1? First of all, the only way to advance is to take money away from other, that should be obvious.
Second of all, even if someone from table 2 accumulates the wealth of 1,000 people (who are nocked down to table 4 or out of the tournament entirely), they are still at a huge disadvantage once they have to move up to table 1 and, of course, what effectively happens is the person from the lower table who accumulates the wealth of his neighbors and takes his winning up to table one – if often swatted back down to nothing as the more experienced, better funded players at the big table make short work of him.
What’s the net effect? The money that our lucky/skillful player from the lower tables takes from his fellow players in the lower ranks is either left on table one and added to their very eclusive wealth poor or, failing to wipe out the new guy, they may reluctantly make room for another seat at the table and chant "One of us" at the initiation ceremony but, what they WON’T do, is put that money back into circulation in the lower tables – the tournament just isn’t designed to work that way is it?
Evenually, invevitably, when you design a system like that and you refuse to redistribute the wealth back from top to bottom – there can be only one winner in the end but, as I’ve been saying, it’s a long, slow game that grinds away for decades and the money goes up and up the ladder and is a long, painful death for those down below, who don’t even realize what they are losing until there’s nothing they can do about it.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
On the bright side, here's an MIT study that concludes "Radiology is an “extreme” professional service with extensive usage of tacit rather than codified knowledge. The importance of tacit knowledge leads to long training periods, a limited global supply of radiologists and heavy government regulation, all of which are obstacles to a “flat world”. Computerization of low-end diagnostic radiology ultimately poses a bigger threat to the profession than offshoring."
http://bit.ly/GXjo8G
Frankly, if you are a motivated guy, I'd be looking into the entrepreneurial side of this and seeing if you can, in fact, build an off-shore service that comes up to quality standards and then use your contacts to build an outsource shop in the US. If you can have 40 Indian Doctors billing $250K a year who you pay $150K a year, then you make $4M, which is a damned sight better than $500K....
Hell, if I had time, I bet I could find investors for this real fast!
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
US companies talk about going to China, where they play numbers games for fantasy sales but who besides Americans are going to gobble them up like Americans? We have just 300M people (5% of Global population) yet we bought 58% of the World's Iphones and Ipods in 2009 (only one I could find): http://on.mash.to/Hj8niN
If someone wants access to our psychotic consumers, they should pay for the privilege, but instead we provide tax breaks to corporations who then outsource jobs and weaken our consumers - MADNESS!
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
Your incredibly poor grasp of economics really stuns me though, I guess you are one of those that lucked into or inherited wealth and now think you are better than everyone else because people who earn their money, even without a good education, generally grasp the basics of supply and demand.
There is a supply of money, only so much is generally created in a year. If 1% of the people get all the money that is created, that means that someone making Billions does, IN ACTUAL FACT, impact your ability to make Billions. It's just that there is so much money around that there is still not a major barrier against your individual effort but your Billion (as if!) would then deprive 1,000 other people of $1M etc.
Unless you are Ben Bernanke - nothing you do will increase the amount of available money. There will be people who get some and people who lose some and - as MOST people can clearly see from the Decade chart above - it's a pretty ABSOLUTE relationship that money taken by the top 1% is taken FROM the bottom 90%.
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
In fact, this is the exact opposite of the point you are trying to make as this guy, unintentionally, is wildly successful at turning people into entrepreneurs. His problem is that his business model isn't proprietary enough to protect and he attempts to take too big of a cut to make it worth it for people to have him find clients, rather than him doing it for them.
The next guy wants to pay minimum wage for skilled labor at off hours and he's really smart as his alternative is "We could raise wages to $100 an hour, fill the positions and then go out of business, taking all our jobs with us." Gosh, I wonder if we can teach him that there are 91 perfectly good wage levels between $8.50 and $100?
The next girl has the same problem but at least she realizes it and has begun paying better wages and investing in training - now she's able to expand. Isn't that amazing - pay people well and they build your business and you make more money! Don't tell anyone, it might ruin capitalism....
Top 1% Tuesday: $105,637 For Me, $80 For You! [View article]
Of course, when we talk about the top 1%, we tend to forget our Corporate Citizens - the ones that pay an average of 12% in taxes ($198Bn last year).
What we really need is a VAT-type tax going forward that eliminates all the loopholes and simply collects a percentage of economic activity. A 20% VAT on all goods and services in a $16Tn GDP would collect $3.2Tn a year - that would pretty well cover the entire budget without the need for any income tax. Then if we DROP income tax rates by 60% and collect another $1Tn a year and keep Government spending under $3Tn, we could pay off our debt in 15 years - faster if the GDP grows.
No more loopholes, no more deductions - if you buy something, it's simply 20% more expensive and if you earn something - you pay perhaps 15% on that if you earn over $50,000 a year. There's the debt crisis solved with lower tax rates.
Next week - we cure World hunger...