(06-03-2021 07:03 AM)OptimisticOwl Wrote:  

(06-03-2021 12:19 AM)Owl 69/70/75 Wrote:  Each year I attend a very high-level tax seminar to get my continuing education hours for both law and accounting. I like it because 1) the format consists primarily of panel discussions with a high-level IRS official, a high-level tax attorney, and a high-level tax CPA on each panel, so you get very authoritative information, and 2) they discuss not only current law but also pending bills and their prospects of getting passed.

Yesterday, in discussing the Biden proposals all the panelists, including the IRS folks, pretty much agreed:
- The corporate rate changes, and the proposed worldwide rate on book income, will be very detrimental to US-based companies in the world economy unless the rest of the world follows suit
- The proposed elimination of the IDC deduction will basically put a halt to domestic oil and gas exploration activity
- The proposed changes regarding taxation of capital gains could force a significant number of wealthy people into bankruptcy

The anti-capitalist redistributionist/socialist/communist direction of the democrats is clearly on display in their tax proposals.

It boggles the mind that the leftists cannot/will not see the economic damage their policies will bring. Either that or they think the cost is well worth it in their single minded pursuit of social justice for transgressions 80-400 years in the past.

(06-03-2021 07:38 AM)georgewebb Wrote:  A century ago, the most prosperous country in the New World turned itself from an envy of the world into an economic and political basket case by deliberately stupid policies. You wouldn't have thought that a successful nation could intentionally and permanently wreck itself like that, but it did.
US leftists seem determined to emulate that tragedy.

(06-02-2021 12:44 PM)Hambone10 Wrote:  

(06-02-2021 09:21 AM)MerseyOwl Wrote:  

(06-01-2021 04:45 PM)OptimisticOwl Wrote:  

(06-01-2021 04:21 PM)tanqtonic Wrote:  Apparently there is deep seated racism and discrimination in the appraisal process. Interesting.

Maybe it is that deep seated discrimination and racism in the appraisal process than is at the root in the crash of real estate in central Minneapolis.

If the purpose is to raise of the value and sale price of a house in a predominately black neighborhood, I wonder what kind of buyer is going to be willing to pay the higher price. I see some possible outcomes, none of which are good for the black community - lower volume of sales, so the homeowner has value on paper (wealth) but no buyers, and/or a dearth of white buyers, making the neighborhood even more segregated.

OTOH, my plan of giving tax breaks to anybody buying a house in a neighbor in which they are a 30% or less minority (includes white buyers in black/hispanic neighborhoods) would seem to encourage mixing of the races.

Well I'm just as confused as I can be....

At some point in the past the gentrification of older (minority) neighborhoods was viewed as a problem. Part of that problem, if I remember correctly, was to push up house prices. That in turn pushes up real estate taxes. And that pushes the incumbent residents out of homes that may have been in a family for generations.

Here in the UK real estate taxes are relatively low (but all other taxes are extremely high). In fact the lowest real estate taxes are to be found in London at around 1% and capped last year at £2098.88. Yes you can have a multimillion £ home and pay ridiculously low tax. Unfortunately I live in the extreme suburbs of London, about 250 miles out, and my home doesn't reach seven figures.

Back when I lived Stateside housing considerations were generally twofold: how safe is the neighborhood; and what is the quality of (public) education. So it seems if one were to implement broken windows theory and expand school choice then there would be a natural increase in real estate valuations?

What's missing from this equation is that although it can push up taxes and force people on fixed incomes out, it BY DEFINITION pushes up home valuations, which allows them to take equity out to:
- build generational wealth allowing them to stay
- Start a business allowing them to stay
- Create a second source of income that could fund the tax increases, allowing them to stay
- simply substitute property value for tax payments through a HELOC.... Where your home value goes up by 100,000 and the taxes by 8,000... so you borrow an additional 9k to fund it (and the increased payment) and stay in your home, and are still net 91k ahead.
etc etc etc
- although they could be 'forced out of their homes', they have equity to buy a home in another, quality neighborhood (just with different qualities)

The problem with this for politicians is that they don't like it when their constituents move out of their districts. IMO, it creates the same sort of segregation that the Civil Rights Act was designed to eliminate.

(06-02-2021 09:23 AM)OptimisticOwl Wrote:  Do you see this as helping the black community? That is what Biden is selling.

I see it as helping politicians.... likely at the expense of the black community, but with the ability to somehow blame Republicans

(06-02-2021 05:48 PM)Owl 69/70/75 Wrote:  

(06-02-2021 04:08 PM)OptimisticOwl Wrote:  

(06-02-2021 03:29 PM)Hambone10 Wrote:  Tanq and OO
The government would certainly have a way of 'deciding' what a bank could loan... incentivize them to make such loans or punish them for not doing so. Valuations/appraisals have ways of being manipulated... especially by the government... see eminent domain

So, say a house has a market value of $200K, but a similar home in a white neighborhood has a market value of $400K. The bank will be loathe to loan $300K against that house because the collateral, if foreclosed, certainly cannot be sold to cover the loan. You are right that the government could coerce the banks into making the bad loans. Then when the banks are facing bankruptcy, they could bail them out. Didn't we already do this once before and it damn near killed the economy?

Pretty much exactly.

(06-03-2021 08:54 AM)MerseyOwl Wrote:  Theoretically, I see your argument Ham, but in practice it's a (remote imho) possibility and not a probability. And the fallback that you can always just move somewhere else doesn't always work. (Have you ever tried to use public transportation in Katy or walk to a local shop?)

Quote:In the UK, there was a surge in house prices many years ago and the government of the day remarked about how they had facilitated the greatest growth in personal wealth in history. Almost all of this wealth was tied up in homes so no real increase in one's standard of living. The "two (rooms) up, two (rooms) down" owners saw the value of their modest homes nearly double. Fortunately, homes are only assessed once in a blue moon (currently 1991) so there was no increase in real estate (aka council) taxes.

But wait, it gets better. Financial institutions seized the opportunity to heavily market second mortgages as, get this, "Equity Release" loans. There might have been an odd individual here or there that invested these funds wisely, but the vast majority bought SUVs (typically Porsche Cayennes) and long vacations in Spain. All that 'released equity' is gone while the increased mortgage remains. These mortgages are on the 'never never' meaning they will never be repaid as they are interest only and usually tied to the Bank of England interest rates plus <2%. Although the BoE is supposedly independent of the UK government, no one believes this. Before the 2008 crash, the official bank rate was 5%. Within 1 year, it was 0.5%. Currently it sits at 0.1%. If it was raised to anything remotely reasonable, say 3 or 4 or 5 percent (avg UK credit card rates are 20+%) the economy would almost certainly crash.

So I screwed up. In retrospect I should have mortgaged myself out and leveraged the liquidity I had at that time. What's really funny is the the financial institutions at one point were scrambling to get everyone to remortgage their homes. Most had variable rate mortgages with discounted rates (for about two years) tied to the then current BoE rate plus 1%. So individuals had a windfall when their variable rate mortgages went from 4% (5% base rate less 2% discount + 1% surcharge) to 1.5% (0.5% base rate with zero discount + 1% surcharge). Me, I screwed up again, and had a fixed rate mortgage.

I'm not sure how the assessment process works over here right now. I know they 'work' with lenders. When I bought my present home I was asked how much I was looking to finance. At one point banks wouldn't lend more than 80% of the value of a home. So it's relatively safe to assume 80% was the projected liquidated value and 20% was a 'premium'. The UK government is currently running a scheme for first time buyers where the government 'lends' 20% (interest free for the first 5 years) and the prospective buyer puts up 5%. I believe there are also other 'shared ownership' schemes.

(06-03-2021 05:31 PM)tanqtonic Wrote:  If you dont report the way they want, they beat the crap out of you.

https://www.nationalreview.com/news/journalist-andy-ngo-recounts-brutal-beating-at-the-hands-of-portland-antifa/

I guess another aspect of 'mostly peaceful' these days.

(06-03-2021 06:18 PM)georgewebb Wrote:  

(06-03-2021 05:31 PM)tanqtonic Wrote:  If you dont report the way they want, they beat the crap out of you.

https://www.nationalreview.com/news/journalist-andy-ngo-recounts-brutal-beating-at-the-hands-of-portland-antifa/

I guess another aspect of 'mostly peaceful' these days.

Let me get this straight: a reporter covering violence organized to mark the anniversary of previous violence was met with ... violence.

Certainly sounds mostly peaceful.

(06-05-2021 10:35 AM)OptimisticOwl Wrote:  Back to voting laws...

here’S what was in it


The bill set limits on the hours of early voting, which comes after Harris County, home to Houston, offered a handful of 24-hour early voting days before the November election. The bill would allow counties to set their hours, but early voting could only take place between 6 a.m. and 9 p.m.



The bill had some expansions of early voting hours. Weekday early voting would have lasted nine hours at a county's main early voting site, rather than just the county clerk's business hours

Counties with at least 30,000 people would have to offer at least 12 voting hours on each weekday during the final week of early voting at the main early voting site, at least 12 hours on the last Saturday of early voting and at least six hours on the last Sunday. Currently, those requirements only apply to counties with at least 100,000 people. The bill also upped the mandatory Sunday hours from five to six.

Increased hours? How racist!

(06-04-2021 10:54 AM)Hambone10 Wrote:  FTR Mersey, I hope my response didn't come across harshly....

I simply meant that there are solutions to the obvious problems... and I think the problems with 'what we're doing' require risking some of the concerns you have. We've done it this way for decades now and things are worse, not better for most people subject to them. We need to find a way to fix your concerns. I don't pretend to have worked out all of the kinks.... I just think that 'having to find a way to address public transportation' in the age of internet and delivery and work from home etc is far less of a concern to me than people who quite literally have zero upward mobility because we have denied them access to what is perhaps the single largest source of wealth creation in the history of the world.... even if we DID have good intentions.

(06-07-2021 07:10 AM)MerseyOwl Wrote:  (FYI I took the weekend off from the Parliament.)

(06-07-2021 07:10 AM)MerseyOwl Wrote:  

(06-04-2021 10:54 AM)Hambone10 Wrote:  FTR Mersey, I hope my response didn't come across harshly....

I simply meant that there are solutions to the obvious problems... and I think the problems with 'what we're doing' require risking some of the concerns you have. We've done it this way for decades now and things are worse, not better for most people subject to them. We need to find a way to fix your concerns. I don't pretend to have worked out all of the kinks.... I just think that 'having to find a way to address public transportation' in the age of internet and delivery and work from home etc is far less of a concern to me than people who quite literally have zero upward mobility because we have denied them access to what is perhaps the single largest source of wealth creation in the history of the world.... even if we DID have good intentions.

(FYI I took the weekend off from the Parliament.)

Sorry Ham, I didn't actually present much of an objection and I hope we're not going to become debate adversaries on this issue and the forum in general.

Transportation was pretty lame, but that's the first obstacle that people of a certain age have to overcome. More broadly and accurately is the obstacle of loss of community. Not sure how to put a dollar value on that or how that can be resolved?

Yes, increasing an individual's liquidity will create opportunities. But that doesn't necessarily translate to wealth 100% of the time. I believe the government has done a pretty good job of reducing taxes on personal property (homes) gains and the ability of rolling over the basis of your existing property to your future one already. But I believe the cash element (or cash equivalent - forgiveness of debt) remains taxable subject to thresholds and conditions. (I could easily be wrong on all of this as I haven't practiced accountancy for over thirty years.)

Not to be condescending, but what you suggest is an optimistic 'art of the possible.'

My perspective is generally pessimistic and littered with financial car crashes and dumpster fires. I have seen real estate crashes, stock price crashes, and just about every other investment crash. You can't 'fix' financial risk, you can only try to mitigate it. And even if you pick a low risk investment, say municipal bonds, they can go bad as well. Just look up Washington Public Power Supply System (WPPSS) bonds (aka "Whoops"). (I nearly bought some of these.) I thought the bonds became worthless, but a little investigating say they eventually paid 40 cents on the dollar. (Ouch.)

So I don't feel that you were harsh. I don't think, I know, we have different perspectives. And that's a good thing. There are too many pessimistic bastards out there already. I should know, I'm the club secretary.