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Fabulous Op-ed Piece - A Really Good Read

Location: Blogs Bob O'Brien's Sanity Check Blog    
Posted by:   bobo 4/22/2006 4:00 AM

Just a quick note - the following blog was emailed to me by someone whose opinion I value, and I can see why - it is really an eloquent summary of the schism that has developed between Wall Street and America. Read it, and feel free to discuss it here.

http://blog.myspace.com/index.cfm?fuseaction=blog.view&friendID=53948906&blogID=112796288

Just a great opinion piece. And folks wonder aloud as to why Dr. Byrne is having a problem getting the powers that be to take the bad guys on...

Could it be because they are now more powerful than many nation-states?
Copyright ©2006 Bob O'Brien
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Comments (17)
Re: Fabulous Op-ed Piece - A Really Good Read By flatbroke on 4/22/2006 7:08 PM
What's that tirade re the wealthy not paying enough in taxes buried in the middle of his blog? It sounds like a Nancy or Harry, or even a Howardism sound bite.

"The 400 wealthiest taxpayers, those making $87 million a year or more, pay the same share of their income in federal income tax and Medicare and Social Security taxes as those making between $50,000 and $75,000."

Of course there's always a way to spin things. But not THAT far! The person earning $50K/year pays what? The same as one earning $87 million and above? My tax program won't accept numbers that high but if you compare $50K against $10 million return you get the idea. A SINGLE payer earning $50K would owes almost $11K in total tax, or 22%. This same payer, earning $10 million (apples and apples) would owe $3.7 million or 37%. I wonder what this 'same amount' is that he is talking about?

I wonder where these math and truth challenged people come from? I know--he didn't actually run the numbers and just accepted the 'conventional wisdom'. There's hardly any way that the $50K/22%/$11K taxpayer can be equated to the tax level of the $10M/37%/$3.7M taxpayer. Or is my problem one that my tax program only accepts income up to $10 million--and $87 million and above would be different? Ha ha ha ha ha ...

Find one warped view--and throw out the entire testament?
Re: Fabulous Op-ed Piece - A Really Good Read By hwh on 4/22/2006 9:22 PM
Apply the Windfall Profit Tax, use proceeds to train & hire 100,000 or so of the millions of affected investors to create the "Department of Marketplace Security."

This would allow the current SEC staff to go to work full time for the Hedges & Broker Dealers for whom they already owe their alegiance. They would be off the taxpayers' payroll and subject to the laws appropriately and accurately applid by the new Department...hwh
Re: Fabulous Op-ed Piece - A Really Good Read By Granny on 4/22/2006 9:48 PM
The writer is obviously not a CPA. That is no reason to throw out the legitimacy of what he is saying. I agree with him 100% that hedge funds are the cause of much of the manipulation in the market. They are siphoning off of the "little peoples" money, along with destroying the reason many companies went public in the first place, access to capital markets. The hedge funds use this as a Catch 22. You need money, therefore you are no good, so we will destroy you. They are an amoral, greedy lot. The are destabilizing our economy and they don't care since they have removed themselves to "gated" communities where they do not have to deal with the "riff raff".

Nobody in government wants to address the problem. Too many of our elected officials are heavily invested in hedge funds. I remember hearing somebody once say that Tip O'Neill, who served in the House of Representitives for 34 years, with over 10 years as the Speaker of the House, and a great champion of liberal causes, took a newly elected idealistic Representative aside. The greenhorn was championing to defeat the pay raises for the members of the House. Tip told him that "you better stop sticking your hand in my pocket."

I recently found out that the government is allowed to trade on insider information. Who can blame us for feeling there is no hope.
Re: Fabulous Op-ed Piece - A Really Good Read By InTheKNow on 4/23/2006 12:22 AM
It is time to tell congress to stop sticking their hands in your pocket or your going to stick your boot up their ass.
Re: Fabulous Op-ed Piece - A Really Good Read By InTheKnow on 4/23/2006 12:52 AM
Can anyone explain to me how the Securities Exchange Act of 1934, enacted by Congress, can be changed and circumvented, by the agency that is supposed to uphold the act, without a Congressional hearing, without a bill and without a vote?

Where are the checks and balances in our government or is that just bullshit?
Re: Fabulous Op-ed Piece - A Really Good Read By gregcable2002 on 4/23/2006 5:21 AM
Didn't I hear the DTCC use the 6 Billion figure before,HMMMMMM.
Re: Fabulous Op-ed Piece - A Really Good Read By anon on 4/23/2006 6:57 AM
"To be truthful, some of the statistics I have observed in the past few months have been staggering. Let me share a few of them with you:

--On an average day, between 18% and 22% of ALL trading on the New York Stock Exchange is hedge fund related.

--On an average day, between 30% and 35% of ALL trading on the London Stock Exchange is hedge fund related.

--It is estimated that in excess of 75% of quoted, convertible bonds are now held by hedge funds. "

http://www.hedgefundcenter.com/wrapper.cfm?article_type=catch%20of%20the%20day&content_id=666&content_type=articles&aff_id=0
Re: Fabulous Op-ed Piece - A Really Good Read By anon on 4/23/2006 6:58 AM
http://www.hedgefundcenter.com/wrapper.cfm?article_type=catch%20of%20the%20day&content_id=666&content_type=articles&aff_id=0
Re: Fabulous Op-ed Piece - A Really Good Read By PhantomCertificates on 4/23/2006 8:53 AM
flatbroke, I believe you've neglected to add in the full extent of the taxes paid for the 50k-75k wage earner. You have taken Federal Tax rates into consideration, but you didn't include social security and medicare in your calculations (7.65% of an employees pay which is paid by the employee, AND the employer). This could account for up to 15.3% added to your 22% for a 37.3% tax rate (although you should also increase the basis by 7.65% as well to account for the employers contribution as wages in the first place). I haven't kept up on recent laws regarding where the top end of these payments are, but when looking at a salary of $87 million, I believe social security and medicare payments work out to be way under 1%. The statement made in the blog I believe is probably fairly accurate.

bobo, in the last blog there was a statement that 1000 companies were using the short on the bid rule. Is there somewhere that I can get a list of which companies these are so I can look at their trading patterns?

thx, Phantom
Re: Fabulous Op-ed Piece - A Really Good Read By bobo on 4/23/2006 10:13 AM
I saw a list somewhere, but can't remember where. I know OSTK is on it.

Anyone else got this?
Re: Fabulous Op-ed Piece - A Really Good Read By cynabear on 4/23/2006 11:32 AM
here's bill moyers take;
www.truthout.org/docs_2006/042306X.shtml

Two years ago, the American Political Science Association produced a study entitled Democracy in an Age of Rising Inequality . The report said people with wealth - privileged Americans - are "roaring with a clarity and consistency that public officials readily hear and routinely follow" while citizens "with lower or moderate incomes are speaking with a whisper." The study concluded that "progress toward realizing American ideals of democracy may have stalled, and even, in some places, reversed."

The following year - 2005 - the editors of The Economist, one of the world's most pro-capitalist publications, produced their own sobering analysis of what is happening in America. They found great and growing income disparities. Thirty years ago the average annual compensation of the top 100 chief executives was 30 times the pay of the average worker; today it is 1000 times the pay of the average worker.

They found an education system "increasingly stratified by social class" in which poor children "attend schools with fewer resources than those of their richer contemporaries." They found our celebrated universities increasingly "reinforcing rather that reducing" these educational inequalities.

They found American corporations no longer successful agents of upward mobility. It is now harder for people to start at the bottom and rise up the company hierarchy by dint of hard work and self-improvement.

The editors of The Economist studied all this evidence and concluded - and I am quoting a pro-business magazine, remember - that the United States "risks calcifying into a European-style, class-based society."

Let that sink in: The United States "risks calcifying into a European-style, class-based society."

In 1960 I heard John F. Kennedy promise that "a rising tide lifts all boats." He was right then. He would be wrong today. Just this past weekend The Washington Post, in a lead editorial, called for a second look at the old belief "that anyone who works hard and plays by the rules can attain the American dream by sharing in the fruits of economic progress." As great wealth accumulated at the top, the rest of the country is not benefiting proportionally. Across the country working men and women are strained to cope with the rising cost of health care, pharmaceutical drugs, housing, higher education, and public transportation - all of which have risen faster than typical family income. The economist Robert J. Gordon, quoted in The Financial Times (another pro-business publication), says there has been "little long-term change in workers share of U.S. income over the past half century." The top ten percent of earners have captured almost half the total income gains and the top one percent has gained the most of all - more in fact, than all the bottom 50 percent.

We are witnessing a marked turn of events for a nation whose DNA contains the inherent promise of an equal opportunity at "Life, Liberty, and the pursuit of Happiness." We were not supposed to be a country where the winners take all. The great progressive struggles in our history were waged to make sure ordinary citizens, and not just the rich, share in the benefits of a free society. Today, however, the majority of Americans may support such broad social goals as affordable medical coverage for all, decent wages for working people, safe working conditions, a good education for every child, and clean air and water, but there's no government "of, by, and for the people" to deliver on those aspirations. America is no longer working for all Americans.
Re: Fabulous Op-ed Piece - A Really Good Read By anon on 4/23/2006 1:57 PM
I will try to post that link again. It keeps getting cut off.
I will also post it in 2 parts so you can just paste them side by side in case it doesn't work again.

http://www.hedgefundcenter.com/wrapper.cfm?article_type=catch%20of%20the%20day&content_id=666&content_type=articles&aff_id=0

http://www.hedgefundcenter.com/wrapper.cfm?article_type=
catch%20of%20the%20day&content_id=666&content_type=articles&aff_id=0
Re: Fabulous Op-ed Piece - A Really Good Read By flatbroke on 4/23/2006 4:03 PM
PhantomCertificates; run the numbers yourself. I did include both SSI and MED for both taxpayers. The total fed take was 22% and 37% respectively. Open your tax program and do it yourself--or just the the tax rate schedules. Use the worst case; that of the single tax payer with standard deductions. To complex for you? Then hold your comments re that which you obviously have a predisposition to believe ALL the bad things you hear. As to your final "The statement made in the blog I believe is probably fairly accurate.", it's really hard to get down to 22% from a base rate of 35% (plus MED making it 37%). Not unless one has itemized deductions, and that's a fault of the code and not the brackets. If we're going to play that game then it's apples and oranges and a comparison can't be made. That statement by the author's was full of dog poop--just admit it and move on to the good stuff he had to say.
Re: Fabulous Op-ed Piece - A Really Good Read By bobo on 4/23/2006 5:54 PM
There is now a section in the forum called current events where politics can be discussed to our hearts' content...
Re: Fabulous Op-ed Piece - A Really Good Read By PhantomCertificates on 4/23/2006 8:15 PM
flatbroke, the tax rate from a 1099-misc (includes both sides of SS and medicare) for the different tax brackets:
50,000 27.66%
75,000 31.40%
100,000 33.40%
1,000,000 37.45%
5,000,000 38.45%
I tried going higher but my software wouldn't allow it. You are correct that the rates are not the same, but you are still way off in stating that there is a 15% difference. A few years back when the top rate was 33%, SS and Medicare were capped to wages of about $125,000, and the standard deductions and exemptions were lower, the rates were actually very close to the same. It seems those recent changes have separated them somewhat. Those making all their money off long term capital gains still have the deal of a lifetime though at 15% (maybe that's to compensate for their stocks getting FTDed into the ground, you think?).

bobo, sorry about being off track. This is my last post on that subject, and if you feel it's better to have these posts placed in another area, I'd totally understand.

Later, Phantom
Re: Fabulous Op-ed Piece - A Really Good Read By Tired of the scams... on 4/24/2006 8:59 AM
Hey Easter Bunny,

yah think "da boys" playing the naked shorting game musta created another "branch operation" to run a domain name registry money making scam?

Seems it's the same thing... making money off borrowed goods which you stay one step ahead of the regulation to avoid paying for, great fodder for your humor column-

http://www.bobparsons.com/adddropscheme.html

Re: Fabulous Op-ed Piece - A Really Good Read By Tired of the scams... on 4/24/2006 9:00 AM
Hey Easter Bunny,

yah think "da boys" playing the naked shorting game musta created another "branch operation" to run a domain name registry money making scam?

Seems it's the same thing... making money off borrowed goods which you stay one step ahead of the regulation to avoid paying for, great fodder for your humor column-

http://www.bobparsons.com/adddropscheme.html


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