prosperity
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Posts posted by prosperity
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So what about those people who weigh it up and decide that quick cash and social status is more important to them than living in a free society, even if it means a poorer, more dangerous society for them in the long run? - isn't that a form of rational egotism?
Something which is not being stressed, I think, is the fact that an alleged range of the moment version of "value" or "self-interest" may in fact not be a value at all. Values have to be considered within the context of an individual's life, not just 3 days or 3 months or 3 years. What is your expected lifespan? What are the other values in your life, and will attaining one alleged "value" negate or destroy others? That is what you have to take into consideration when evaluating whether something is in your best interest.
Isn't there a small bloc of the population in every society who need to be selfless?Assuming one's life is a value, then no.
Edit: for clarity.
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Ford has managed to deal with the UAW getting potential wages down to $55 per hour and saving the company $550 per year, so they still claim they don't need a bailout, even though they had record loses in 2008. $55 per hour is great wages, from my perspective, but if it is coming down from $75 per hour I guess the UAW is finally realizing that if something isn't done soon they lose everything.
"Ford said the agreement would trim its average wages for the 42,000 workers covered under the contract, including the value of benefits, to about $55 per hour this year, while the U.S. operations of foreign-based automakers -- or what auto executives call "transplants" -- pay workers on average $48 to $49 per hour."
Added on Edit: Sorry for the multiple replies in one post. My computer locked up trying to upload my reply.
Maybe they're realizing that they've sheered this sheep to the point where the wool ain't growing back.
I just can't believe anyone was foolish enough to hold on to those bonds this long. What did they expect? That with the government involved all would go well? LOL!
...maybe this is "buy and hold" gone mad.
Oh yes, the other negative was that Obama took a protectionist stand in his speech, saying people ought to buy American cars. This guy can sure channel Hoover/Roosevelt!The more I hear this guy speak, the more I start to think that he's just a copycat. Has he come up with anything original, or are all his policies basically a ripoff of his favorite predecessors?
From the restructuring plan put forth by GM it looks like the government will ultimately own about 50% of the equity, the union will own about 40% and the bondholders will get the remaining 10%. GM's existing shareholders will end up with nothing.Bondholders are supposed to come first. But then, Government has been doing a good job of breaking up contracts...so I guess this is another notch in the belt.
I think it may have more to do with Hummer sales being in the dumps. Although, the new "green" GM certainly won't have any room for Hummers. I wonder if it will have room for cars that people actually want to buy?...hmmm a "green hummer"?
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For those interested, here is Yaron Brook on Fox Business regarding credit card regulation.
http://www.youtube.com/watch?v=XvgnU84Vjyw
Bottom line, the credit card industry is not a free market, and prices are going up due to regulations. Furthermore, people should be responsible for their lives and read the contracts they sign.
Unfortunately, I don't think he got a fair shake on that show. That guy let that Linda lady spew nonsense about Capitalism without Brook being able to put her in her place and explain what Capitalism really is.
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There are so many... but I will pick one.
I agree with you. There are so many. One of my new favorites is by Cole Porter: De-lovely. I think it's charming, playful, plus I challenge anyone to listen to it and try to resist smiling at least once during the song.
It's been redone so many times, but Alanis Morissette I think did a decent job. -
Fortunately, the private space industry is starting to take off, mainly because there will be no alternative after the shuttles are retired. ISS will still have to be supplied, and some enterprising business people are starting to realize this, I quote:
My grandfather was telling me about this guy who designed and built a spacecraft that left the Earth's orbit and then came back down to Earth again, with no heat shield. It was basically a shuttlecock shaped kind of thing that spun like those little "helicopter" seeds that fall off those tipu trees and was able to "float" back to Earth rather slowly. Not sure where he got this info from, but I'd love to see something like that. From what I understand, it cost a LOT less than the space shuttles that NASA has built for them.
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So I got a huge bill from the IRS today. It says that I owe taxes for the gross profits of the securities I sold in 2007. But I should be taxed for the net income, not the gross profit!
I don't know much about taxes (I've always used free online services.), so I don't know how to respond.
Do I need to visit a lawyer, an accountant, a tax office or handle it myself? Any recommendations?
Dealing with the IRS in almost any capacity is about the most frustrating thing you will ever go through. I know this from first hand experience.
I also know a businessman who was audited once, but the way they did it was they raided the business, and the agents came in "guns a blazin'" (guns drawn actually) and kept everyone hostage in the building. A family member had died that day, and they were not even allowed to go to the funeral until the IRS had all the paperwork.
Edit: they actually missed the funeral due to the IRS not allowing them to leave the building.
In the end, it was discovered that the IRS had made a mistake, the business had done nothing wrong. They (the IRS) didn't even give so much as an apology.
If you decide to go it alone, good luck. These people do not give a rat's a** about you is my understanding.
I hate to tell you, but you're gonna owe with penalties and interest going back to the time it was originally due. I would get a referral to a CPA from a trusted/respected friend or family member and redo your return for that year just to make sure the amount owed matches what the IRS is telling you you owe. Unfortunately, the IRS is probably right.This is one more reason I recommend a financial planner. They should review your tax situation and alert you to the tax consequences of sales, etc. Also, I would pay for a tax service, at least something like TurboTax online, which guides you through the process. It's not very expensive and well worth it. Most paid services also come with some sort of audit protection/help should you need it. It certainly would've been a lot cheaper than the penalties and interest you're going to pay now.
I second K's recommendation.
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I think what I'm getting at seems to be getting lost. The Argument from the other person essentially was this: "Look, Canada has a nationalized health insurance system where everyone is taken care of, blah blah blah...and it's not killing them as a country".
Now, I agree that all of this is theft, but the debt is being paid down and if Canada has a surplus, then it has a surplus. But, we know that Socialism doesn't work. So...I guess, what am I missing. Has Canada become more capitalistic than the USA? Because, you know that if liberals can point to an alleged instance of Socialism working and being beneficial for people, they will.
Zip, you brought up something I hadn't realized. 40% of your taxes are spent on health insurance? That seems like a lot.
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NO!
What makes you think i want humans to be treated less than animals? Why do you think I'm "the hatred of man".
I have just not found a morally consistent system that provides solutions for all problems that are important in my point of view. If i had to choose one of those systems, i probably chose objevtivism or something close to it, but since it doesn't not fully satisfy me i'd go without a morally consistent system for now.
I'm merely questioning thinks that doen't seem logical or clear to me and one of these things is the line between humans and animals.
I'm not saying that you, specifically, represent the hatred of man. I'm just saying that the argument you seem to be hinting at would suggest that man is somehow lesser than other animals because he isn't allowed to "get away with" shirking his moral responsibility that results from having a volitional consciousness while animals - in your own words - aren't to be held to the same standards as humans. It just seems like that argument actually is advocating that animals be allowed to have volition and do whatever they want and forget about the consequences. I mean if they really can choose one act over another, then why aren't we holding them accountable for their actions?
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No. I don't want animals to be treated equal. I'm justing questioning the straight line between animals and humans.
So...the argument you've presented goes something like this: "Animals have volition. So do humans. But, human beings are to adhere to reality and be held accountable for their volitional acts, and animals are not."
This is, in essential terms, the hatred of man. THIS is part of why Objectivism is against environmentalism. The constant calls for humans to be treated as less than animals. In fact, humans are really being asked to be treated as less than dirt.
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I disagree with the statement that the difference between humans and animals is the ability to act volitionally.
Monkeys have a sense of morality
Elephants show basic math skills
With these findings, it is very hard for me to find a clear line between. Probably the best thing is the ability to allow the evolution of memes. But even that isn't as clear.
I think you should think about what your statement(s) imply. Like, applying justice to the immoral.
By your line of thinking, shouldn't we be rounding up that ape that nearly killed that woman who was keeping her as a pet and bringing him to justice? We should also put the "owner" on trial for having a slave since slavery was abolished some time ago in this country. In fact, we need to round up ALL of those animals "in the wild" acting immorally by catching them and putting them on trial for theft, assault, and murder. I think they still have the death penalty in TX.
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OK, so someone challenged me the other day about Canada being in better shape financially than the U.S.
They pointed to the alleged "fact" that Canadians pay less in taxes, have no deficits and no debt to speak of. Naturally, I was intrigued by these statements because I don't know of a debt-free nation these days that is also relatively high up on the ladder of civilization.
So, what I found out where a few things that were untrue (no surprise) and then a few issues which seem puzzling.
It appears as though Canada's tax rates are similar (income tax rates) to the U.S., not lower. Their debt, though, seems much smaller in comparison coming in at just under a trillion dollars and falling compared to our $11 trillion or so and rising.
I guess I never really thought of Canada as being financially better off than America. What are the Canadians doing? Dramatically rationing their health care and all of their other social services? Are they receiving financial aid on a massive scale from other countries? I feel like I'm missing some piece of this puzzle?
Their taxes are about the same, maybe a little less, their population is smaller than America's but their debt seems to be falling, not rising. What gives?
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I guess I will have to clarify. I certainly have no problems with nudity, the human body or even the intricate details of the vagina. Okay?
The two drawings the OP linked to did not present a pleasant view of woman, IMO. In the first, my eye went straight to the not-very-good details of the woman's vagina rather than seeing a beautiful nude woman on a beach. In the second, I thought her breasts looked too far apart and disproportionate to her body, much less the shortened arms, and the croch area is just a few lines in shadow and look odd.
If the intent of the drawings is to have my eye go directly to the woman's crotch (or breasts) and think, "eww, that doesn't look right" then the drawings are at least effective. If the intent of the drawings was to show the beauty of a woman's nakedness on a beach or in a forest, then I think the drawings miss their mark.
I agree with Chris that pin up art is fantastic. I also like the nude photography that Playboy does. They show quite a bit, yet somehow it never looks nasty, distasteful or awkward. The same cannot be said for Hustler or Shaved Schniz.
I realize that's photography, but I feel the same about nudity in painted/drawn/sculpted art. I think there is a lot to be said for leaving something to the imagination, while still showing a beautiful nude form.It's sort of like a suspense or thriller type movie...the shower scene in Hitchcock's Psycho is more effective and meaningful to me (with the implied stabbing...screams, shadows, a few drops of blood mixing with the water in the drain) than some of these new, slasher movies that show every little gory detail of a knife slicing into flesh. The gory details take me out of the moment, out of the emotion they are trying to portray. Instead I end up chuckling and thinking, "well that's just overdone." Psycho makes me think twice when I hear something strange while in the shower.
EDIT: Prosperity, I like all three of your examples, although they're not my favorites; however, if David were bent over and the view was of his testicles hanging down from behind, would you still like it? That's the difference that I'm getting at.
Ahhhh I see...
...yeah. I mean, so is it the portrayal of the women or the artist's skill level? What you mentioned sounds like the skill level of the artist (i.e. breasts too far apart)
The paintings don't do it for me either, I am just wondering.
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I just finished reading The Romantic Manifesto, so I'm still trying to wrap my head around naturalism, etc., but I think that's what your drawings are. When you put everything in full view, it takes away from the romantic nature of it, for me. I mean, why not show a hairy mole on the subject's back? Does that make sense, or am I missing something?
Well, it depends. Does the evaluation of the nudity in that piece differ from this piece?
Or this? (this has always been a favorite of mine):
Change the medium. What is your evaluation of the Statue of David? Is it different from the two paintings above?
If it is, then the next question would be....why?
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I follow you. Actually SNerd hit on what I was thinking. It's not that I think M2M is inherently bad. But, I think the market should decide which accounting standard to use...and in the insurance and banking industry the M2M coupled with legal reserve requirements has - I think - caused a huge problem.
I agree that you probably can't just start yanking regulations out left and right though. I think a nice transition would be first to lower the legal reserve limit and then allow banks and insurance companies to move away from mandatory risk-based capital requirements.
Maybe I misunderstood you then because any investment that pays anticipated future cash flows is going to fluctuate in value as interest rates change and as the investor’s perception of the risk associated with those future cash flows changes. Even though zero coupon bonds don’t pay interest, they do have a single future cash flow at maturity. As a result, their current fair value will increase and decrease with the general level of interest rates. In fact, the fair value of zero coupon bonds has greater volatility associated with a given change in interest rates than would a normal bond with a coupon. Because of their longer duration, zero coupon bonds are actually more risky than plain vanilla bonds with coupons.The controversy over M2M has arisen because certain securities which were valuable at one time have dropped in value. Nobody complained about M2M when asset prices were rising. Given the capital and reserve requirements that the government imposes on financial institutions and insurance companies, decreased asset values resulting from M2M meant that some of these businesses had to raise additional capital.
To answer your question, M2M accurately accounts for these assets because it presents their value at a given point in time (usually the date of the balance sheet). Despite what some people might claim, the value of these assets is uncertain in the future because there is a question as to whether the principal amounts will be repaid. Remember, we’re not dealing with zero coupon government bonds here. We’re talking about much more exotic securities like CMOs or CDOs which are both illiquid and of questionable credit quality. Given these circumstances, the M2M fair values of these securities must reflect the disadvantages associated with their negative attributes.
Rather than suspending M2M accounting, why don’t the regulators simply change the relevant reserve and capital requirements? Even if you get rid of M2M accounting, securities analysts will still calculate the current fair values of the balance sheets that they are analyzing. Those fair values will then show that a company’s book assets are overstated and this will be reflected in the market value of the stock. This sort of work has been done by analysts for years and it would continue even if M2M went away.
In my opinion, M2M is just an easy target for politicians who want to look like they’re doing something about the financial crisis. On the other hand, these politicians ignore the positive effects of M2M, mainly the enhanced transparency that it provides to investors.
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No there is nothing misleading about it.
How do they do that? Adjust the meta tags on the whitehouse site?
The power of backlinks.
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The subject you've chosen for this thread is completely misleading.
John Link
??? How so. He's listed #1 for the term "miserable failure". I thought it was funny.
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Maybe this is gaming the system by internet marketers, but I'd call it savvy. Obama now ranks #1 for the search term "miserable failure". I think that's appropriate.
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Thank you for posting that. As you said, without having the actual terms in front of us, this has all been a hypothetical discussion.
I do agree that P4 says "We can lower your credit limit, even on a whim", but only because the agreement says "we may reduce your credit limit from time to time with good cause" and "Good cause includes ... our adverse reevaluation of your creditworthiness".
Since how creditworthiness is not defined in the terms as far as I can tell (from a quick scan), it is a meaningless term that translates to "our whim".
I should have known the lawyers for the CC's would have that covered...
It's called a unilateral contract. They're not new. One party must adhere to the terms of the contract while the other party may adhere to the terms of the contract. The difference is that one party can break or alter the contract with no adverse legal effects while the other party cannot. Both parties agree to those terms beforehand though. Is that what you are upset about?
All insurance contracts are unilateral contracts, but unilateral in the other way. But no one bitches when the shoe is on the other foot. Sheesh.
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Fluctuations in the values of "fixed income" assets such as bonds or more exotic securities like Collateralized Mortgage Obligations are the natural result of changes in interest rates. For example, if you own a bond that pays interest (its coupon) at 5% and the prevailing interest rate for bonds with similar credit characteristics rises to 10%, then the market value of the bond will decline. For fixed income securities, their prices move in the opposite direction of interest rates. When interest rates fluctuate, bond prices also rise and fall.
For financial statement purposes, fair value is defined as: "the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date." [Just as a semi-funny aside, it took the Financial Accounting Standards Board (FASB) approximately 160 pages to define the term "Fair Value" in SFAS 157. Sheeeesh!
] In other words, fair value is calculated at a specific point in time. Since a company's balance sheet also lists assets and liabilities at a point in time, the fair values of those assets and liabilities are necessarily their values on the date of the balance sheet, not 5 or 10 years out in the future. It isn't really any more relevant to declare that you think the price of a bond will be $1,000 when it matures in 5 years than it is to say that you think the price of GM stock is currently undervalued. For financial statement reporting purposes, one should look at the current fair values of the assets and liabilities in question.I am familiar with how bonds work, but I'm talking about bonds where the value is dependent on the future, like zero coupon bonds. They don't pay interest. They mature. These are the types of assets insurance companies love BTW because of exactly what you began to hint at. It gives the institution a way to mitigate interest rate risk for assets that they know they will have to pay out on (i.e. insurance policies).
My question remains...if M2M demands current market value, then how does mark to market accurately account for these types of assets that may be held by large financial institutions? These companies may end up looking financially distressed when in reality, they are not. If this "distress" causes them to fall below the legal reserve limit, then the Government has effectively caused a problem here, haven't they?
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OT, but my take is that "market" values are in appropriate when the reasonable cash flow profile of the asset is different. Market is far too low for some assets that have been beaten down by uncertainty. Economic or expected cash flow NPV value is probably overstated when economy is turning down, but I'd rather see that used. Note that MTM is only about 2 yrs old as an accounting rule. How ever did we make it through the last century of banking without it? Oh heavens!
Correct me if I am wrong, but doesn't M2M say that you must provide a current value for your assets?
If that is the case, then isn't that going to cause a ridiculous amount of trouble for just about any bank or insurance company whose assets have maturity dates and so their current market value should be less (sometimes far less) than what it will be at maturity? I'm not trying to discredit the accounting method, just wondering if this is something appropriate for some business models and inappropriate for others.
So, for example, let's say you have an asset that will be worth $1,000 20 years from now. Today, it is only worth $250. If that brings you below mandatory reserve requirements, then the Government just caused you to go bankrupt or forced you into a liquidity problem (of which, if you are large enough, they will bail you out of).
...or do I have something wrong?
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Yup, the government brought down AIG.
I wonder how many other companies out there are "troubled" because they played by the governments rules...particularly with regards to accounting methods.
Ahhh yes, New York's "anti fraud statutes" AKA the Martin Act. They trap you with that one because you either comply with the initial subpoena/request for whatever documents they want and subject yourself to the near dictatorial power granted to the Governor via that Act, or you go to jail for ignoring the subpoena.
I remember when the first outrage over AIG holding a conference to encourage producers to continue selling products came about. I actually was called by one of AIG's PR people about an article I wrote about AIG. They ousted Greenberg and installed incompetent management - incompetent for running an insurance company.
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AIG should be bankrupt, and those contracts should be automatically scrapped. But, as long as the government insists on bailing out AIG, they aren't bankrupt, so the empoyees are entitled to their contracts. A contract is a contract. Unless there's a clause that says government intervention renders the contracts null and void, I can't see a way out of 'em. I voted yes.
I hear this a lot. I'm not sure I'm convinced AIG is really the bad guy that it's being made out to be. I think that, based on what I know thus far, the problem wouldn't really be as much of a problem if:
1) The Government didn't essentially influence the mandatory use of mark to market accounting standards through the FASB - which is just another quasi Government agency funded through regulations set forth in the Sarbanes-Oxley Act which altered the Securities Exchange Act of '33 to provide for this.
While I don't think there is anything inherently wrong with this accounting method, it the market should determine if it's appropriate for the business involved. For example, this type of accounting does cause a unique problem for insurance companies and banks whose assets are typically long-term and their current market value at any given point (which really can't be determined until or unless the assets are sold) is going to be different (sometimes radically so) from what their assets will be upon maturity. This can have a crushing effect on these types of businesses if the economy slows down or goes through a contraction.
When AIG takes a hit on some speculative investments and they have to value those assets coupled with their long-term holdings according to mark to market accounting standards, then you run into a situation where their overall assets don't look very valuable or as valuable.
2) The Government didn't impose legal reserve limits
The Government requires banks and insurance companies to have a "legal reserve". The legal reserve for an insurance company though is MUCH MUCH higher than for a bank. If the company's legal reserve drops below a certain point, then the company is deemed to be "in trouble" and must raise capital to meet their reserve requirements. If they don't, they can be downgraded by rating agencies and this of course creates a lot of problems. They can also be put out of business and deemed insolvent.
When you force a company that is long-term by nature to be short term in its valuations (via mark to market accounting) and you force that company to cough up cash immediately if they drop below certain reserve limits that are calculated using this accounting method, then of course you are going to have trouble. The company won't be able to sell their blocks of money in the kind of economic environment we have - which was caused by artificially low interest rates - which they need to do to replenish their capital reserve. So, they get a "loan" from the Government. Now they are having to sell off blocks of money to pay back the Government. Same essential problem, but now you have taxpayors footing the bill. And NOW, you have outrage over bonuses being paid.
But is any of this really the company's fault? The speculation plays that AIG made may have been inappropriate. I'm not sure they would actually be bankrupt if this were a free market. Their subsidiary company - AIG financial products - probably would be. But their core business would be quite strong. In reality they have a strong cash position. However, according to the Government's arbitrary legal reserve requirements, the whole thing should be bankrupt.
Now, if there is a scare that AIG will indeed go bankrupt, that could prompt policy holders to either cash in their policies or borrow as much as they can from them, effectively creating a "run" on the insurance company. The theory is that this would have a domino effect on the rest of the industry. AIG and others would have to liquidate their holdings to meet the requests of their policy holders.
Because insurance companies are the largest buyers of corporate debt, it is thought that this would have a "freeze" effect on the bond markets. Since, savings is the real stimulus to an economy, you might see things get MUCH worse.
I think it is a pretty good scare tactic, although this could be the lesson insurance companies need to stop selling universal life-type policies (which is a whole 'nuther discussion) and move towards a whole life product line which doesn't treat cash values as a quasi demand deposit account. Of course, the company could put a moratorium on policy loans and surrenders if it is in their contract.
Of course, all of this would be seen as "unfair" by policy holders and we'd need more Government intervention to "stop the atrocities".
What about the fact that the Government caused this whole thing to begin with.
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If you look at my statement wording exactly, I think you'll see that we are in violent agreement.
Oh. I thought you were saying it wasn't a loan, or wasn't really a loan. It is interesting the point you make, and disappointing that lack of personal responsibility forces banks to create products that they don't want to create - i.e. the mutated "line of credit" turned quasi fixed-term loan.
I still say the credit card companies are the victims here, even though I suspect some people may laugh at that.
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Consumption taxes are certainly better than property taxes or taxes on work... however, they are not voluntary, in that you can not choose not to pay them when you buy something in a store... yet they can be considered volitional in the sense that you could, conceivably, avoid paying them by not buying any products or services, growing your own food and getting water from a stream etc.
It would probably not be necessary anyway, as it is in the self-interest of individuals to have a police department to reduce crime. I am sure that sufficient numbers of people would be willing to contribute something to ensure the government can provide police, military and courts. It is in their own interests to do so - of course, if they can get it for free, it is possibly in their interests to "mooch" off of the rest. However, the rich have more reason to fund a police force as they have more to lose from crime, (and they have more available capital) therefore, are more likely to pay taxes voluntarily.
I suppose you could have voluntary collection of sales tax. For example, if the business owner chose to sign up to collect a certain percent when you purchased his goods and services and send that to the Government for national or local defense.
You could choose, of course, not to shop at that store.
I agree with everything else you wrote, JM. This is the only area where I would debate the issue.I think that it would make more sense to have "a la carte" pricing for all court-related services, so that if someone had elected to go with a "handshake" deal, and then found the other party had reneged, the option to go to court would still exist, but would be much more expensive. One would be looking at "going rates" which people who had bought contract insurance would be covered for. To declare that the opportunity to sue is only available if you buy the insurance or pay a contract protection fee strikes me as more exclusionary than necessary.
Making the system available and voluntary would serve to encourage more people to buy the contract insurance without leaving those without funds to buy insurance prohibited from going to court at all. This would also not preclude lawyers from handling cases on a contingency basis, which they assess as winnable, even though the plaintiff had not bought the insurance.
I hear this idea of contract insurance as a way to collect tax money without collecting tax money. I think it makes sense. I mean, it's like paying health insurance premiums vs paying out of pocket. You could have rated rates based on your net worth and protect-able assets. People who had something worth protecting would have the contract insurance...plus, doesn't everyone deal with others on a voluntary basis in a free society?
In other words, doesn't everyone need contract insurance?
The Coming Auto Bailout
in Economic News
Posted
Thanks Snerd. Interesting read. It is nice to see financiers stand up for themselves. Finally, these are words I've been waiting for management to say proudly. I noticed that Oppenheimer is also standing up for themselves.