$1.5 Trillion GOP Tax Bill Signed By Trump – Housing Largely Uneffected Thanks To Lower Marginal Tax Rates (Ham and Mayonnaise!)

This is a syndicated repost courtesy of Snake Hole Lounge. To view original, click here. Reposted with permission.
President Trump on Friday signed the Republican $1.5 trillion tax overhaul that is expected to trigger tax cuts for most Americans next year. The GOP/Trump bill undoes some of the damage caused by the tax increases put in place on January 1, 2015 by the Obamacare legislation such as increasing the top bracket from 35% to 39.6%.
Although this is not related to housing per se, the corporate tax rate has been cut to 21%, putting the US in the middle of the G-7 nations instead of being the most heavily tax major nation on earth.

This post was published at Wall Street Examiner on December 26, 2017.

2017: A Review Of The Fed, Treasuries, Mortgages and Housing (Volatility and Velocity)

This is a syndicated repost courtesy of Snake Hole Lounge. To view original, click here. Reposted with permission.
2017 has been an interesting year. Donald Trump was elected President and seated in January 2017. The Federal Reserve kept rates near zero with a massive balance sheet for almost all of Obama’s 8 years as President, then started to raise rates and unwind their massive balance sheet AFTER Trump was elected. Note the decline in M2 Money growth after Trump’s election.

This post was published at Wall Street Examiner by Anthony B Sanders ‘ December 23, 2017.

Taking Turns With The B(L)S

This is a syndicated repost courtesy of Alhambra Investments. To view original, click here. Reposted with permission.
The worst aspect of this economy is by far the real effects pressed upon especially American workers. Of that there is no doubt, including young adults who would be working rather than ‘studying’ if the economy was at all like it has been described. The second worst part is watching politicians trade their descriptions for whomever occupies the White House. It does nothing to advance the cause of the American worker (or the global economy for that matter).
In early 2015, within the recent shadows of the BEA’s Q4 2014 GDP report that estimated growth that quarter of better than 5%, Republicans were more and more criticized for their economic criticism. The left-leaning Washington Post in February 2015 wrote:
A robust economy marked by a boom in jobs and a plunge in gas prices is threatening the longtime Republican strategy of criticizing President Obama for holding back growth and hiring, forcing the GOP to overhaul its messaging at the beginnings of a presidential campaign…
The improvement may mark a turning point in the nation’s seven-year-long debate over the state of the economy. Obama came to office amid a financial crisis, promising to turn the economy around. Republicans repeatedly – and, in the 2014 midterm campaign, successfully – argued that he had fallen short, with an economy suffering slow growth and unnecessarily high unemployment.

This post was published at Wall Street Examiner on December 21, 2017.

Three Cheers for the GOP Tax Plan

Last night the Senate passed the Republican proposed tax plan, a major political victory for Trump and the GOP-controlled Congress.
At the Mises Wire, we have featured numerous articles pointing out many of the fallacies involved with the general debate on the issue of “tax reform.” For example, the absurdity of “revenue neutral” reform, the danger of raising rates through eliminating loop hopes, the fallacy of trying to address the deficit through eliminating deductions on state and local taxes, and the general notion that tax breaks can be equated to tax subsidies. While the Republican bill does fall for some of these traps, the result of the bill as a whole is a genuine reduction in the tax burden for the majority of Americans. That is always something worth celebrating.
There are additional benefits to be found within the bill as well.
For example, the elimination of the Obamacare individual mandate is a small, but significant, step to improving the American healthcare system. As I noted in March, when Paul Ryan’s attempt at Obamacare reform failed, the rise of direct primary care and other market solutions meant that the best thing the GOP could do is simply provide as much freedom as possible for Americans to opt out of government-managed insurance markets:
Given that this is happening naturally on the market already, the legislative focus for those in Washington concerned about American healthcare should be preventing any future laws and regulations that would destroy this model going forward. Further, rather than trying to completely overhaul Obamacare, simply eliminating the individual mandate tax and allowing Health Savings Accounts to be used for healthcare membership would be subtle ways of empowering the market to revolutionize American medicine. This should be coupled with real tax cuts, not ‘revenue neutral reform’ to help Americans keep their own hard-earned money to help pay for it.

This post was published at Ludwig von Mises Institute on 12/20/2017.

House Passes Trump Tax Plan For Second Time

Update: In a vote that almost exactly mirrored yesterday’s results, the House once again passed the final Trump tax bill – formerly known as the conference agreement on the Tax Cuts and Jobs Act – by a vote of 224-201.
As the Financial Times pointed out, “the vote gives the president a longed-for legislative victory to carry into his second year, one whose scope matches the radical reforms of healthcare and Wall Street regulation achieved by his predecessor Barack Obama.”
But the tax bill is already as divisive as Mr Obama’s achievements, ensuring 2018 will be dominated by electoral sparring over whether it will help middle-class families, as Republicans claim, or will deliver further riches to the wealthy and powerful, as Democrats say.
Mr Trump said at a ‘celebration’ cabinet meeting that people would begin seeing the results of the tax bill in February when adjustments to their after-tax income started appearing in pay checks. ‘We got it done,’ he said, thanking congressional leaders.


This post was published at Zero Hedge on Dec 20, 2017.

Republican Tax Plan Is Headed For Final Round Of Votes

Barring some unforeseen catastrophe (or another floor-vote surprise akin to Sen. John McCain’s last minute decision to strike down the Senate’s plan to repeal and replace Obamacare), Congressional Republicans appear all but certain to pass the reconciled version of President Donald Trump’s tax-cut plan – the first time Congress has successfully passed comprehensive tax reform since 1986.
With their self-imposed Friday deadline looming, the Republicans’ Senate leadership managed to secure commitments from several holdouts, including Maine Sen. Susan Collins, Florida Sen. Marco Rubio and Utah Sen. Mike Lee.
At last count, the only Senator who hasn’t committed to a ‘yes’ vote is Arizona’s Jeff Flake. Flake famously delivered a scathing speech condemning President Trump from the floor of the Senate after announcing that he would not seek another term. He has been an outspoken Republican critic of the Trump agenda, per Reuters.
Meanwhile, Sen. Bob Corker – the only senator who voted against the Senate’s original tax bill – said late last week that he would vote for the current bill after several provisions were added that would benefit him personally, along with a handful of other Republicans.

This post was published at Zero Hedge on Dec 19, 2017.

The Tea Party, Ten Years Later

December 16, 2017 is the tenth anniversary of the modern Tea Party. That fact will surprise many laypersons who uncritically accept the mainstream narrative that the Tea Party began on February 19, 2009 when Rick Santelli, live on CNBC from the Chicago Mercantile Exchange (CME), declared a rebellion against “socialism” one month into the Obama administration.
But wait a minute: Rick Santelli on establishment NBC lighting the spark of an anti-establishment rebellion? An uprising over mere proposed Obama bailouts of mortgage holders coming four months after silence over (if not a defense of) George W. Bush’s $700 billion TARP bailout of Wall Street?
If the mainstream narrative seems fishy, that is because it is. What really happened ten years ago and how was the Tea Party transformed from a libertarian grass-roots movement to today’s controlled (and just-about dead) establishment version? What are some of the lessons that can be learned?

This post was published at Ludwig von Mises Institute on 12/18/2017.

Senate Tax Debacle: Certain Pass-Through Entities Face Marginal Tax Rates Over 100% Under Current Bill

As the House and Senate continue to try to reconcile their two versions of a tax plan, the taxing structure for pass-through entities (s-corps, LLC’s, etc.) continues to be somewhat controversial, if not completely nonsensical. As we pointed out last week, the Senate bill somewhat randomly chose to exclude pass-through entities organized as family trusts from tax cuts which would ultimately leave them on the hook for much larger tax bills due to the elimination of other deductions. It’s unclear whether this bizarre exclusion was just an oversight or an intentional political hit on an easy target that no one in Washington DC would dare defend publicly: rich families organized as trusts.
Now, a new note from the Tax Policy Center lays out some scenarios whereby the marginal tax rate for high-income pass-through entities could soar to over 100%. Of course, while two rational people can debate the impact of a ~40% tax rate on a person’s desire to work, we’re almost certain that a taxing structure that takes more than 100% of your marginal income will be a slight disincentive. Here’s an example of how it works from the Wall Street Journal:
Consider, for example, a married, self-employed New Jersey lawyer with three children and earnings of about $615,000. Getting $100 more in business income would force the lawyer to pay $105.45 in federal and state taxes, according to calculations by the conservative-leaning Tax Foundation. That is more than double the marginal tax rate that household faces today.
If the New Jersey lawyer’s stay-at-home spouse wanted a job, the first $100 of the spouse’s wages would require $107.79 in taxes. And the tax rates for similarly situated residents of California and New York City would be even higher, the Tax Foundation found. Analyses by the Tax Policy Center, which is run by a former Obama administration official, find similar results, with federal marginal rates as high as 85%, and those don’t include items such as state taxes, self-employment taxes or the phase-out of child tax credits.

This post was published at Zero Hedge on Dec 11, 2017.

A Potential Government Shutdown Is Literally Just Hours Away, But Congressional Leaders Insist That Everything Will Be Just Fine

Either the Republicans are going to give Democrats virtually everything that they want, or the federal government will shut down at the end of the day on Friday. We have been through this process time after time, and in every single instance the Republicans have always folded like a 20 dollar suit. Unfortunately, it looks like the Democrats are going to win big this time around too. The spending agreement is essentially an updated Obama budget that fully funds Planned Parenthood, that contains no money for a border wall, and that doesn’t reflect any of President Trump’s other important priorities either. On Thursday, the House is expected to pass this horrible bill, and the Senate is expected to take up the matter on Friday. According to Bloomberg, right now this plan would keep the government open through December 22nd…
The House Rules Committee approved a rule setting the bill up for a floor vote Thursday, after which the Senate will have until the end of the day Friday to avoid a partial government shutdown. A formal check of how members would vote on the Dec. 22 deadline came back showing widespread support, said Representative Dennis Ross, a member of the vote-whipping team.
So even if this plan gets through both the House and the Senate, we will be facing another government shutdown deadline in just a few weeks.

This post was published at The Economic Collapse Blog on December 6th, 2017.

Why Socialists Prefer to Take Bribes from the Rich than Let the People Get a Tax Break

The tax cut critics are really just morons if not outright evil people who just want to rob anyone who has more than them. Their analysis put the bill’s total price at $1 trillion, contradicting the Republican argument that the measure would essentially pay for itself. They act as if this is somehow different than Obama, who increased spending that went into the pockets of the bankers.

This post was published at Armstrong Economics on Dec 4, 2017.

GOP Releases All 479 Pages Of The Tax Reform Bill – “Vote-A-Rama” Begins

The Senate tax bill is headed for a potentially unlimited series of decisions on possible amendments – known as ‘vote-a-rama’ – as the full text of the revised bill has just been released.
As Bloomberg reports, it’s unclear how long that process might take, though we do note that unlike Obamacare, Senators will at least get to see what’s in the bill before they vote on it.
Democrats could spend hours offering numerous amendments meant to highlight any flaws they believe the bill contains.

This post was published at Zero Hedge on Dec 1, 2017.

Walking in Their Footsteps: Powell Will Maintain Status Quo at Fed

It looks like Trump’s pick to chair the Federal Reserve plans to walk in the footsteps of his predecessors.
In other words, we can expect the legacy of Ben Bernanke and Janet Yellen to continue unbroken. That means a continuation of interventionist monetary policy, artificially low interest rates into the foreseeable future, and plenty of quantitative easing when the time comes.
Yes. The new boss looks a lot like the old boss.
Jerome Powell testified before the Senate Banking Committee on Tuesday. The New York Times described it as a ‘relatively placid affair.’
Maintaining the status quo doesn’t set off too many fireworks.
Democrats seem OK with the pick. Interestingly, the people who were against Powell when he was an Obama appointee are OK with him now that he’s a Trump appointee.
Some Democrats have indicated they might oppose the nomination. But, importantly, Mr. Powell drew little opposition from conservative Republicans who opposed both his nomination as a Fed governor in 2012 and his reappointment in 2014. Senator Dean Heller, a Nevada Republican who voted against Mr. Powell both times, said he was trying to get to yes.’

This post was published at Schiffgold on NOVEMBER 29, 2017.

Trump Wins: Judge Denies Obama Holdover’s Suit Against Mulvaney Running CFPB

In a somewhat unsurprising decision, President Trump won a legal fight over who gets to run the Consumer Financial Protection Bureau (at least for now).
As Bloomberg reports, Trump’s budget director Mick Mulvaney can remain as temporary head of the agency, a federal judge ruled in rejecting a request to block the move fromLeandra English, who was named to the role by the departing director.
U. S. District Judge Timothy Kelly in Washington rebuffed English, who sued to Nov. 26, contending she is entitled to the provisional post.
Kelly, who has been on the bench since only September, is a Trump nominee who previously worked for Senate Judiciary Committee Chairman Chuck Grassley, an Iowa Republican, and also served as a federal prosecutor.

This post was published at Zero Hedge on Nov 28, 2017.

Obamacare’s Revenge: The IRS Will Not Process Your Tax Return Unless You Tell Them Whether You Have Health Insurance Or Not

Yes, this is a true story. I was completely shocked when I learned about this too, and this just underscores the importance of repealing the individual mandate immediately. Shortly after taking office, President Trump issued an executive order which was intended to move the IRS away from enforcing Obamacare’s individual mandate, but now the IRS has found a way around that executive order. According to the official AARP website, the IRS has announced that it will not process any tax returns from individuals that are not willing to disclose whether they currently have health insurance or not…
The Internal Revenue Service won’t process individual tax returns in 2018 unless taxpayers indicate whether they have health insurance coverage or an exemption.
The move, announced last month, reverses course from this year, when the IRS said it would not require filers to indicate on 1040 tax forms whether they had health insurance. Filers were still required to have medical insurance or pay a penalty, but the IRS accepted and processed returns even if taxpayers didn’t indicate coverage status.
So what this means is that you will not get your refund until you tell the IRS if you have health insurance.
And if you don’t have health insurance and you don’t qualify for an exemption, you could be hit with a very painful financial penalty.

This post was published at The Economic Collapse Blog on November 26th, 2017.

Saying Goodbye to Richard Cordray at CFPB Is Hard to Do

Last Wednesday, Richard Cordray, the Director of the Consumer Financial Protection Bureau (CFPB), announced he would be stepping down from his post at the end of this month. Cordray is the former Attorney General of Ohio and there are rumors he may make a run for Governor there.
The CFPB, a Federal agency, was created under the Dodd-Frank financial reform legislation of 2010. The legislation resulted from the greatest fraudulent wealth transfer from the middle class to the 1 percent since the Wall Street frauds of the late 1920s. Both periods ended in an epic financial crash that left the U. S. economy on life support. Since the financial crash of 2008, the U. S. economy has grown at an anemic 2 percent or less per year despite massive fiscal stimulus and unprecedented bond purchases (quantitative easing) by the Federal Reserve.
Despite the desperate need for the CFPB, Republicans fought against its creation and then refused to confirm Cordray for his post as Director for two years. Cordray was finally sworn in on July 17, 2013 after having served in the post for 18 months under a recess appointment by President Obama. Republicans have continued to battle Cordray and attempt to derail his work in protecting vulnerable consumers from credit card, student loan and mortgage frauds.

This post was published at Wall Street On Parade By Pam Martens and Russ Marte.

Duties Imposed Against Chinese “Dumping” Hurt American Consumers

For years, special interests have called on the U. S. government to ‘level the playing field’ in the form of duties, levies, and other antiquated measures. Democrats and Republicans alike have aired their grievances over the trade deficit, grumbling about exporters hurting American workers by flooding the market with cheap goods. These complaints are deeply misguided.
Over the last decade, China has been accused of tilting international trade in its favor. Is this true? No, it is demonstrably false, as Beijing’s subsidized exports greatly benefit American consumers far more than the Chinese population.
You can’t tell that to the U. S. government, though.
In late October, the Department of Commerce announced that China dumped aluminum foil on the U. S. market, selling the goods at ‘unfairly low prices.’
Trade policy under Trump hasn’t been dramatically different from his predecessors, though. Who who monitor trade deals have forgotten about President Barack Obama’s 35% tax on Chinese tires and President George W. Bush’s 20% tax on imported steel.
US Imposes Anti-Dumping Duties Before Trump’s stop in Beijing as part of his 12-day Asian tour, the U. S. government imposed duties ranging between 96.81% and 162.24% on Chinese aluminum foil. The preliminary report determined that China dumped nearly $400 million worth of aluminum foil imports on the U. S. market in 2016 at very low prices.

This post was published at Ludwig von Mises Institute on November 16, 2017.

Financial Tyranny: “We The People” Are The New Permanent Underclass In America

Authored by John Whitehead via The Rutherford Institute,
Americans can no longer afford to get sick and there’s a reason why.
That’s because a growing number of Americans are struggling to stretch their dollars far enough to pay their bills, get out of debt and ensure that if and when an illness arises, it doesn’t bankrupt them.
This is a reality that no amount of partisan political bickering can deny.
Many Americans can no longer afford health insurance, drug costs or hospital bills. They can’t afford to pay rising healthcare premiums, out-of-pocket deductibles and prescription drug bills.
They can’t afford to live, and now they can’t afford to get sick or die, either.
It’s a gamble any way you look at it, and the medical community is not helping.
Healthcare costs are rising, driven by a medical, insurance and pharmaceutical industry that are getting rich off the sick and dying.
Appallingly, Americans spend more than any developed country on healthcare and have less to show for it. While Obamacare (a.k.a. the Affordable Care Act) may have made health insurance more accessible to greater numbers of individuals, it has failed to make healthcare any more affordable.
Indeed, health care in America has become just another way of making corporations rich at consumer expense.

This post was published at Zero Hedge on Nov 14, 2017.

Here’s The Latest On The GOP Tax Bill As The Senate Starts Debate

Much like the Obamacare repeal and replace effort earlier this year, the past couple of weeks have been an invariable roller coaster ride for GOP representatives as Congressional leaders have tried to form some level of consensus within a fractured party with competing interests. This week will undoubtedly be no different.
In light of that, we’ve taken a look at some of the key differences between the Senate and House tax bills as they currently stand. As of now the biggest difference is the treatment of the State and Local Tax (SALT) deduction. While the Senate has called for a full repeal of the SALT deduction, House members have drawn a hard line, even though almost all political “hard lines” become flexible under the right circumstances, demanding at least $10,000 worth of property tax deductions be allowed. Per Bloomberg:
The House and Senate are on a collision course over one of the most prized individual breaks in the tax code.
The Senate Finance Committee will start debating late Monday afternoon the 247-page tax proposal released last week by Chairman Orrin Hatch. As of now, the ‘conceptual’ mark has some significant differences with the tax bill the House Ways and Means Committee approved last week — chief among them the Senate’s call for repealing the state and local tax deduction entirely.
Ways and Means Chairman Kevin Brady took a hard-line approach during a ‘Fox News Sunday’ interview, saying the House won’t accept a tax bill that eliminates the deduction entirely. The House bill retains the deduction for property taxes up to $10,000.

This post was published at Zero Hedge on Nov 13, 2017.

Repealing Obamacare’s Individual Mandate Would Save $338 Billion

With Republicans scrambling to find every possible dollar to pay for Trump’s “massive” tax reform package, on Wednesday morning a new analysis by the CBO calculated that repealing ObamaCare’s individual mandate – an idea that had been floated previously by Trump – would save $338 billion over 10 years. CBO previously estimated repeal would save $416b over 10 years due to reduced use of Obamacare subsidies, demonstrating once again how “fluid” government forecasts are.

The report was released as the Senate prepares to unveil its own version of the Tax reform bill amid growing GOP dissent, and comes as some Republicans are pushing for repealing the mandate within tax reform, as a way to help pay for tax cuts. Still, as The Hill reports, that idea has met resistance from some Republican leaders who do not want to mix up health care and taxes. Previously the CBO had come under fire on Tuesday from Sen. Mike Lee (R-Utah), who slammed the agency after Sen. Bill Cassidy (R-La.) told The Hill that he had been informed that the CBO was changing its analysis of the mandate to find significantly less savings.
Just as notable was the CBO’s announcement that it was changing the way it analyzes the mandate, which Republicans suspect would show less government savings and fewer people becoming uninsured as a results.

This post was published at Zero Hedge on Nov 8, 2017.

Hillary What Happened – She Rigged the Democratic Party

Donna Brazile’s new memoir, Hacks, has exposed Hillary Clinton for what she really is – a corrupt manipulative politician. Bracile is the former Democratic party leader. Behind the curtain, she is known as a foul-mouth boldface liar. Now Brazile’s book, reveals that Clinton took control of the party long before deciding who would be the Democrat final candidate. This is what the Clinton’s have been known for – behind-the-scenes manipulation.
Clinton knew that the Democratic party was heavily in debt. Brazile describes Hillary’s acquisition of the party as an extortion. The Party left behind by Barack Obama inherited $24 million debt of which $15 million was bank debt, and $8 million was owed by the party to suppliers who had not been paid. In real terms, the Democratic Party was bankrupt confirming what our models had been forecasting about the decline in that party.

This post was published at Armstrong Economics on Nov 7, 2017.