Mnuchin to Congress: Cut taxes or market will dive

[KingsX]

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The ORANGE SWAN set this up. It won't be pretty.


Mnuchin to Congress: Cut taxes or market will dive


"Treasury Secretary Steven Munchin, speaking on the eve of the 30th anniversary of the 1987 market crash, predicted stocks will plunge if Congress fails to overhaul taxes.

"There's no question in my mind if we don't get it done you're going to see a reversal of a significant amount of these gains," Mnuchin told Politico on Wednesday. "

http://money.cnn.com/2017/10/18/inve...eet/index.html

[KingsX]

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The economic term, "black swan", is something unforeseen that comes out of left field to tank the market.

In this case, the swan is orange.

Trump was the first to tout tax cuts which sent the stock market to new breaking highs. In other words, Trump promised the sky and the markets shot to the moon.

Trump also promised low and middle classes huge tax cuts. Trump initially promised $25,000 single/$50,000 married couple standard deductions. This is why many common folk voted for Trump.

But the GOP's proposed tax cuts for the rich is an abomination that will greatly cut taxes on the most wealthy while increasing taxes on many low and middle incomes. In other words, the GOP's proposed tax reform has initiated class warfare and tells the lower and middle classes to "eat cake."

Trump has manipulated the GOP between a rock and a hard place... whether their tax cut for rich oligarchs passes or not... it won't be pretty.

[es7129]

Households that have children will likely see an increase in their taxable income. The current plan eliminates personal and dependent exemptions. The plan is to offset this with more child tax credit which is already available to immigrants without SSNs.

[Farp]

Well, I've been around for over six decades--closer to seven than six. Warm words from Washington are nothing more--just words. Ever since I can remember, I've heard politicians bloviate about tax cuts; and percentage of income-wise, I have seen taxes rise unimpeded. Oh sure, one tax may go down, but there are always a dozen others batting down the door. Any lowered tax, such as income tax, is always offset by a tax or fee on something else.

Plus, I live in Minnesota. I can remember back in the 60's when the state implemented the TEMPORARY 2.75% sales tax. It turned out to be temporary all right--they soon raised it to 3%. Today, it's well north of 6%. Have you looked at your utility bills, your phone bills, or found out what you're really paying for in buying a gallon of gas? The tax portions of those would amaze you. And have you bought a license for anything lately? I'll bet you paid more than you did last year (I just bought a hunting license--up over 10% from last year).

Anyone hoping for a tax break--by Trump or anyone else--would be better off chasing rainbows. Like I said, I've lived it as long or longer than most on this board. And with the deficits in governments and government pensions, there ain't gonna be no tax breaks goin' forward.

[jimmythebee]

markets are "irrational exuberance",they are due for a tumble,tax cuts or not

[KingsX]

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Historically low interest rates for the past decade have pushed many otherwise prudent people into the stock market.

But since Trump began touting his tax cuts for businesses... the market has shot over the moon.


" Major Index Performance Since the Presidential Election:

S&P 500 (SPY): Up by 23%
DJIA (DIA): Up by 28%
Nasdaq 100 (QQQ): Up by 30%
Russell 2000 (IWM): Up by 32%
Financials (XLF) Up by 36%

These are exceptional 11 month returns and have been achieved in part due to the expectations for tax cuts. If any suggestions materialize that the tax initiative is in jeopardy the moves to the downside could be swift and violent, especially in the small caps index which is up by over 10% in the last few weeks alone. "

https://seekingalpha.com/article/411...-huge-tax-cuts

[KingsX]

Households that have children will likely see an increase in their taxable income. The current plan eliminates personal and dependent exemptions. The plan is to offset this with more child tax credit which is already available to immigrants without SSNs.

The difference is... existing personal exemptions which are indexed for inflation are for everyone.
Tax credits for minor children are NOT indexed for inflation and are only for minor children.

Under the proposed GOP tax plan, lower income single seniors over age 65 will get a tax increase.

This year the single over age 65 standard deduction plus one personal exemption equals $11,950.
tax exempt with a 10% tax rate. Next year [2018] the PROJECTED IRS amount adjusted for inflation
would be $12,250. plus a 10% tax rate. The GOP proposes $12,000 & 12% tax rate.


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[KingsX]

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Also... the word is out that the GOP wants to use "Chained CPI" for inflation adjustments.
For many years, they have been advocating substituting "Chained CPI" for Social Security...
which would mean LESSER cost of living raises than under the present system of calculation
which is bad enough... but "Chained CPI" is even worse !

[KingsX]

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Here's a Ron Paul quote about the GOP's tax plan and "Chained CPI"


" The framework also contains a stealth tax increase imposed via the chained consumer price index (chained CPI). Supporters of chained CPI clam the government is currently overstating inflation. The truth is exactly the opposite: government statistics are manipulated to understate inflation.

Chained CPI enhances the government’s ability to lie about inflation. One way it does so is by claiming that inflation does not lower our standard of living if we can substitute cheaper goods for goods made unaffordable by inflation. So inflation does not harm you if you can’t afford a steak dinner as long as you can still buy a cheeseburger.

Chained CPI allows the government to take maximum advantage of “bracket creep,” where individuals are pushed into higher tax brackets not because they are actually earning more money, but because inflation creates the illusion they are wealthier. In fact, by decreasing their purchasing power, inflation makes most people poorer. The inflation tax thus raises taxes on declining incomes. It is hidden and regressive, making it the most insidious of all taxes. "

http://www.ronpaulinstitute.org/arch...limit-liberty/

[KingsX]

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Ted Cruz and Bernie Sanders are debating tax reform now on CNN.

Cruz LIED right out of the chute by saying EVERYONE will get a tax cut !!

Even Trump's financial people are crawfishing now, saying "almost" everyone.

See my post above how lower income single seniors over age 65 will get a tax increase.

The irony is... I bet neither Cruz or Sanders will mention them.