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Federal Reserve makes emergency rate cut
MSNBC ^ | 01.22.08

Posted on 01/22/2008 5:29:53 AM PST by Perdogg

Federal Reserve makes emergency rate cut.

(Excerpt) Read more at msnbc.msn.com ...


TOPICS: Business/Economy; News/Current Events
KEYWORDS: economy; fed
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To: Perdogg
Well, then, let's have a tax cut that works to promote growth:

PERMANENT MARGINAL INCOME AND CAPITAL GAINS TAX RATE CUTS.

Productivity growth is what counts for economic growth. You can get productivity growth by lowering the penalties (taxes) on capital and labor applied to productivity growth.

The main way to get the economy to apply more investment (capital) towards productivity improvment is to lower the taxes on the returns you get when you invest for productivity. That means a Capital Gains Tax Cut, and a Corporate Income Tax Cut. Lower Corporate Taxes works for all of Europe (a socialist haven, BTW), it will work here.

The main way to get people to be more productive (i.e. work more) is to decrease their marginal income taxes. That causes actual economic growth because people are penalized less for being productive, so they work more.

The really productive, expanding and hiring business owner needs to see improved incentive (i.e. lower income taxes) before he'll work harder.

Tax cuts that put money in people's pockets to spend gets spent. That doesn't improve productivity. It moves money from the Government's spending account to your spending account, surely a salutory move since the government usually just immolates the money.

Nonetheless, spending doesn't cause growth. Keynsianism is dead.

Investment for productivity improvement causes growth. Supply Side Economics works every time it is tried.

Rather than a political-pander-tax-cut, let's have a tax cut that works:

PERMANENT MARGINAL INCOME AND CAPITAL GAINS TAX RATE CUTS.

141 posted on 01/22/2008 7:03:18 AM PST by Uncle Miltie (Vote "Tax Hike Mike!" < / sarc>)
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To: Uncle Miltie

That would help, but thanks to a gutless GOP Congress and lack of leadership from Bush, it isn’t likely to happen.


142 posted on 01/22/2008 7:04:39 AM PST by NVDave
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To: RKBA Democrat
..Naaaah. Not yet. Not enough suckers panicking. Get ready to refi your house, though...

Just locked in this morning, along with our rental properties.

143 posted on 01/22/2008 7:05:43 AM PST by bella1 (Living in Granholmistan)
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To: RSmithOpt
Interesting. Most economists believe that Bush's idea is the best one for the situation, at least it's a SUPPLY SIDE solution. It was never meant to be a permanent fix, I don't know where you got that. It's just a temporary patch. The closer we get to the election and having all the tax breaks repealed by the Einsteins in congress, the more unstable to market will be.

If you really remember 21 percent interest rates and double digit unemployment, then you KNOW what you said about the present economic situation was pure hyperbole...to put it as kindly as possible.

144 posted on 01/22/2008 7:06:52 AM PST by cake_crumb (Being a preacher DOES NOT exempt you from being a liar and a crook)
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To: Milwaukee_Guy

Unless one is paying to be plugged in directly to the market indicies, I would bet $15 to a gallon of gas that most ‘trusted’ news outlets have been instructed to delay numbers 30 minutes or longer today. The big guys are screaming for an edge now. LOL!!


145 posted on 01/22/2008 7:08:55 AM PST by RSmithOpt (Liberalism: Highway to Hell)
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To: bella1
"Just locked in this morning, along with our rental properties."

My last Mortage will be paid off in June so no ReFIs for me but I am salavating at my next rental purchase!

Low Interest Rates and depressed R.E. market.

Time to make money!

146 posted on 01/22/2008 7:09:53 AM PST by Mad Dawgg ("`Eddies,' said Ford, `in the space-time continuum.' `Ah,' nodded Arthur, `is he? Is he?'")
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To: NautiNurse

Well I went short in November and have done very well thank you.


147 posted on 01/22/2008 7:10:12 AM PST by mad_as_he$$ (Stop the unFair Tax now; before it is fair for your neighbor and not you.)
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To: am452

Yes it was a depression. You must have been one of the very few lucky ones unaffected by it.


148 posted on 01/22/2008 7:11:28 AM PST by cake_crumb (Being a preacher DOES NOT exempt you from being a liar and a crook)
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To: Perdogg

We should just add a zero to the whole money supply.


149 posted on 01/22/2008 7:12:49 AM PST by FightThePower! (Fight the powers that be!)
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To: Alberta's Child

Nice.


150 posted on 01/22/2008 7:13:01 AM PST by mad_as_he$$ (Stop the unFair Tax now; before it is fair for your neighbor and not you.)
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To: cake_crumb
"Yes it was a depression."

There must be some "new" definition of the word depression I am not aware of.

151 posted on 01/22/2008 7:15:46 AM PST by Mad Dawgg ("`Eddies,' said Ford, `in the space-time continuum.' `Ah,' nodded Arthur, `is he? Is he?'")
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To: Mad Dawgg

That’s what every called it back in the ‘70s.


152 posted on 01/22/2008 7:19:19 AM PST by cake_crumb (Being a preacher DOES NOT exempt you from being a liar and a crook)
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To: cake_crumb
Yes it was a depression.

The late 70's was a depression??? ROTFLMAO

153 posted on 01/22/2008 7:19:50 AM PST by am452 (Globalist: Converting the American people to the Democrat party since 1992)
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To: Uncle Miltie

“PERMANENT MARGINAL INCOME AND CAPITAL GAINS TAX RATE CUTS.”

I’ll go along with you on half of that. The capital gains rate is already low comparatively speaking. The marginal tax rate on someone who is upper middle class and who works to earn a dollar is somewhere around 38-45% when you add in social security and state taxes. Said another way, someone who earns a dollar pays 38-45 cents in taxes whereas someone who has a capital gain pays 15-20 cents, tops. That’s a significant disparity that is unjust.

When the effective marginal tax rate on earnings is dropped to somewhere in the region of capital gains, then I’ll be interested in hearing about the need for a further capital gains tax cuts.


154 posted on 01/22/2008 7:20:04 AM PST by RKBA Democrat (Lord Jesus Christ, Son of God, have mercy on me, a sinner!)
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To: RSmithOpt
Fox not showing the stock ticker “bug” they usually have. CNN delayed, Yahoo messed up.

These problems could do more harm than the good they think they are trying to do by slowing the data flow.

The market is kinda holding right now and has pulled up from the pent up futures action.

The next move down later today could be a big one....

155 posted on 01/22/2008 7:20:15 AM PST by Milwaukee_Guy (Don't hit them between the eyes. Hit them right -in- the eyes!)
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To: cake_crumb

The inflation numbers were calculated differently during back then. They were reformulated in the early 1990s.

If we use the method from the 1970s, we have about 8% inflation, not 1.5%.


156 posted on 01/22/2008 7:20:33 AM PST by JeffAtlanta
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To: Mad Dawgg

And I am TRYING to explain that things are not as bad as everyone here seems to think they are. I’m TRYING to give a basis of comparison. Compared to the Carter years, this is a hiccup. I’m not saying it’s nothing to worry about, but GEEEZ, some of the reactions are way over the top.


157 posted on 01/22/2008 7:21:17 AM PST by cake_crumb (Being a preacher DOES NOT exempt you from being a liar and a crook)
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To: cake_crumb
That’s what every called it back in the ‘70s.

I don't recall anyone calling the late 70's a depression.

158 posted on 01/22/2008 7:21:30 AM PST by am452 (Globalist: Converting the American people to the Democrat party since 1992)
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To: cake_crumb

No one called the 1970s a depression. I grew up during those times and everyone called it a recession. Maybe you are confused by someone saying, “the 1970s were depressing”.


159 posted on 01/22/2008 7:22:55 AM PST by JeffAtlanta
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To: cake_crumb

160 posted on 01/22/2008 7:23:19 AM PST by CedarDave (The early primaries are port-o-potties rented to the left to pee in the conservative hot tub)
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