Spengler over at atimes.com strums the overture for the End of the World (as we knew it). I'm still waiting for him to be right. Is it this time?
Our tax policies and regulatory policies encourage people to put their money in houses. This includes the mortgage deductions in our tax code. Obama policies will make this worse. When you raise the marginal income tax rate you make the mortgage deduction more valuable which will push more money into real estate. This will in no way help the average American since it will take that money from other useful pursuits while at the same time feeding the next bubble. But it will favor professional speculators while leaving people who buy homes to live in (what a silly notion) holding the bag for the results.
I can remember when families with five children lived in houses with three bedrooms. Now a couples with one child or no children live in houses with five bedrooms. And they are never home because they are at work. That's living your life according to the Tax and regulatory code.
Getting caught holding a bag of manure at the end is part of it, too. And because taxpayers feel they have been forced into this position, they feel a lot of resentment. It is up to our politicians to mobilize this resentment and point it elsewhere. Let's see, acquiring target now...
Wall Street and the City of London rode an unprecedented wave of profitability by providing overpriced leverage to consumer and corporate markets. Led by the financial engineers at Lehman, the securities industry grew an enormous infrastructure of staff, systems, and financial exposure. They were so successful that when the music stopped, there was no way to liquidate this mechanism gracefully. It only could be allowed to collapse.
Our tax policies and regulatory policies encourage people to put their money in houses. This includes the mortgage deductions in our tax code. Obama policies will make this worse. When you raise the marginal income tax rate you make the mortgage deduction more valuable which will push more money into real estate. This will in no way help the average American since it will take that money from other useful pursuits while at the same time feeding the next bubble. But it will favor professional speculators while leaving people who buy homes to live in (what a silly notion) holding the bag for the results.
I can remember when families with five children lived in houses with three bedrooms. Now a couples with one child or no children live in houses with five bedrooms. And they are never home because they are at work. That's living your life according to the Tax and regulatory code.
Getting caught holding a bag of manure at the end is part of it, too. And because taxpayers feel they have been forced into this position, they feel a lot of resentment. It is up to our politicians to mobilize this resentment and point it elsewhere. Let's see, acquiring target now...
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