Daily Digest

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Daily Digest 4/19 - Tax Angeles, Don't Count On That Gov't Pension

Wednesday, April 19, 2017, 9:35 AM

Economy

Tax Angeles (Los Angeles)

Combining the contemplated taxes with the 2016 and 2017 tax increases, the hit is $4.3 billion, or $1,100 for every Angeleno, $4,400 for a family of four and would result in a 16% sales tax (up over 80%), and an 80% bump in our property taxes.

Don't count on that government pension

Of the 237 cities studied, 29 received an "F" grade, reflecting a funding ratio of less than 35 percent. Those plans cover many thousands of workers who cannot possibly be paid their full promised pensions, absent a huge tax increase (which would also come out of their pockets as workers).

Op-Ed Why tax day is a nightmare for freelancers

Say you’re a freelancer making a net income of $40,000. You would pay roughly $5,000 in self-employment taxes, $3,500 in income taxes and $4,500 in health insurance. That’s 30% of your income.

What Default Rates on Subprime Auto Loans Are Telling Us

The UBS researchers also found evidence that defaults on auto loans are likely to spread to more nonprime defaults on credit cards and personal loans. About 16% of all auto loans outstanding are subprime, amounting to $179 billion out of total auto loans of around $1.07 trillion. Overall subprime debt totals $1.25 trillion in mortgages, student loans and auto loans.

IMF raises China growth outlook but warns of risk of 'disruptive adjustments'

China's debt-to-GDP ratio rose to 277 percent at the end of 2016 from 254 percent the previous year, with an increasing share of new credit being used to pay debt servicing costs, according to an estimate from UBS.

Is the ‘real number’ for the national debt $70 trillion?

The Treasury Department, in a 2016 report, said that the projected expenditures for scheduled benefits for social insurance programs would exceed projected revenue by $46.7 trillion. Adding to it the gross debt of $19 trillion yields a figure of $66 trillion. Over an infinite horizon, Treasury said, total resources for Social Security and Medicare amounted to $90.5 trillion in present value terms.

Shinzo Abe eradicates last hawks from the Bank of Japan

That means governor Haruhiko Kuroda is likely to have strong backing if he proposes further monetary stimulus and reduces the odds of an early exit from its programme of negative interest rates and massive asset purchases.

Spanish treasury places 1.55 bln euros on market at negative interest rates

A total of 950.12 million euros worth of nine-month treasury bills carried an average interest rate of -0.33 percent, while the remaining 600 million euros worth of three-month treasury bills fetched an average interest rate of -0.487 percent.

Struggling Aussies taking on negatively geared properties

THE LUCKY COUNTRY?

One in 10 households can’t pay bills on time
One quarter can’t afford an annual one-week holiday away from home
A fifth can’t pay for entertainment away from home once a fortnight
One in 10 can’t afford a special meal with family or to buy new clothes
Up to one in 20 households experience struggle to meet basic needs such as meals and heating

Housing Speculation An Addiction Canada's Economy Can't Kick

The chart below by Stéfane Marion, chief economist at economics and strategy at National Bank of Canada, compares U.S. home prices per the Case-Shiller 20-City index to Canadian home prices per the Teranet-National Bank 26-market index. Both indices are based on similar methodologies of comparing pairs of sales of the same home over time. The shaded areas denote recessions in Canada. Note that during the housing crisis in the U.S., there was only a blip in Canada's housing market:

Gold & Silver

Click to read the PM Daily Market Commentary: 4/18/17

Provided daily by the Peak Prosperity Gold & Silver Group

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

4 Comments

saxplayer00o1's picture
saxplayer00o1
Status: Diamond Member (Online)
Joined: Jul 30 2009
Posts: 3856
Markets Start to Ponder the $13 Trillion Gorilla in the Room

Markets Start to Ponder the $13 Trillion Gorilla in the Room

Bloomberg-9 hours ago

... undetectable market response to China's run-down of U.S. Treasuries in recent years. Combined, the balance sheets of the three now total about $13 trillion,

China's $8.5 Trillion Shadow Bank Industry Is Back in Full Swing

Bloomberg-16 hours ago
The measures have sent debt-reliant borrowers scurrying to shadow financing, an industry Moody's Investors Service estimates is worth about $8.5 trillion, and ...

China expands bad loan securitisation scheme to include more ...
Nasdaq-7 hours ago

Two more Illinois universities at risk of junk ratings from Moody's

KFGO - ‎17 hours ago‎
Moody's Investors Service on Monday said it placed seven state universities under review for potential downgrades affecting $2.2 billion of debt because Illinois has failed to provide them with full operating funding. Four universities, Northeastern ...

Illinoisians Could Be Facing Income Tax Hike

MyStateline.com-10 hours ago
Senator Syverson talking about the multi-billion dollar hole that the state of Illinois ... Residents there voicing their opinions on the budget deficit and possible tax ...

Towns, Educators Lash $400M Teacher Pension Cost Shift Plan

CBS Connecticut - ‎19 hours ago‎
(CBS Connecticut) — Teachers unions, education groups, an association of towns, and officials from West Hartford today criticized the governor's proposal to shift $400-million in teacher's pension expenses from the state to cities and towns ...
DennisC's picture
DennisC
Status: Silver Member (Offline)
Joined: Mar 19 2011
Posts: 184
Cloud with silver lining? Perhaps.

Re: Teacher Pension Cost Shift

I'm guessing that Connecticut's governor would like very much to avoid the optics of having to increase state income tax rates to help balance the "budget" (a.k.a., "the next bag holder's problem").  If it is possible to move part of a funding need out of the "budget", then one can always claim to have not been responsible for raising income taxes. A potential plus side, IMO, is the opportunity for some "price discovery" for CT property tax payers when it comes to the costs of funding public pensions. Regardless, it's likely a pay me now or pay me later situation (i.e. moot point).

BTW, this seems like a potential revenue loss leader offset with "other peoples money":

Income Tax Exemption for Teacher Pensions

Public Act 14-47 (§ 50) exempts a portion of state teachers’ retirement system (TRS) income from the income tax.  It does so by allowing taxpayers, when calculating Connecticut adjusted gross income for state income tax purposes, to deduct, to the extent properly includable in gross income for federal income tax purposes, for the taxable year commencing January 1, 2015, ten per cent of the income received from the state teachers' retirement system, for the taxable year commencing January 1, 2016, twenty-five per cent of the income received from the state teachers' retirement system, and for the taxable year commencing January 1, 2017, and each taxable year thereafter, fifty per cent of the income received from the state teachers' retirement system.

source: http://www.ct.gov/trb/cwp/view.asp?Q=558106&A=1598

KugsCheese's picture
KugsCheese
Status: Diamond Member (Offline)
Joined: Jan 2 2010
Posts: 1287
Re: Op-Ed Why tax day is a nightmare for freelancers

The article didn't mention the self-employment tax deduction, nor that since the office is the home any travel from home for biz is deductible.   

Time2help's picture
Time2help
Status: Diamond Member (Offline)
Joined: Jun 9 2011
Posts: 2523
New NASA Suit Design Brings Hope

NASA Designs Suit Capable Of Protecting Humans Hoping To One Day Live On Earth (TheOnion)

Quote:
WASHINGTON—Saying the groundbreaking new technology could allow humans to withstand the harsh conditions they will experience on the planet’s surface, NASA confirmed Tuesday that it has created a climate-controlled suit capable of protecting people who hope to one day live on Earth.

Agency officials told reporters that the suit, which they have named the Terrestrial Mobility Unit, is specifically engineered to keep humans safe from the extreme temperatures and unbreathable atmosphere found on Earth, increasing the possibility that, decades from now, they may be able to inhabit the dangerous planet.

“Our team has finally created a functional, reliable space suit that humans may someday use to survive the punishing environment they encounter on Earth,” said NASA senior research scientist Catherine Seltzer, who spearheaded the 12-year, $180 million project and helped devise the unique polymers that allow the suit to endure a nonstop bombardment of intense ultraviolet radiation. “From the devastating storm systems sweeping the planet to the many toxic gases filling its atmosphere, Earth will be hostile to human life. But with the Terrestrial Mobility Unit, a person may actually be able to walk safely across its surface.”

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