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ybul writes: "Then as the Federal Reserve is chartered by the government, simply reduce interest rates to zero and pay down the principle."
While a simplistic idea in theory moving the rate to zero would not have an immediate impact, especially if like you suggest we cut spending dramatically. The Federal government issues debt with the promise to pay a stated amount of interest for the stated period of time. So, moving a rate on newly issued debt to 0% would not have an immediate impact (less new issues being created). If you are suggesting taking existing issues credit rate to 0% I would say this would be disasterous! What value would any issue of US debt be in the future if the can arbitrarily change the interest they are going to pay to you. This is something that would clearly be unprecedented in the marketplace.
Secondly, in order to issue debt you need a buyer of the debt. If you are issuing new instruments (bills, notes, and bonds) and paying a rate of 0%, the market for your instruments will be much less than other alternatives. Do I buy a US bond paying 0% or something else that is relatively stable paying 1%.
Besides, the Fed funds rate (the rate the Fed can effectively control) is already near 0 (7 bps). You would have to buy a 30 year bond today to get a yield that comes close to keeping up with inflation.
I can tell you that institutional investors (pension systems, insurance companies, corporations) are already modeling "Japan scenarios" for US debt instruments. Scenarios where the Fed funds rate stays at or near 0% for an extended period of time.
Government should never be a MAJOR contributor to the economy. Its contribution should be limited only to those powers granted by the constitution and only in limited situations. There is now doubt that there is some incremental benefit to the economy, but again, GVT only re-distributes dollars that have been created elsewhere in the market. It does not create. As to your point around social programs... I believe in ECON 101 we called that the leaky bucket... a "necessary evil". Now, my personal belief system is those of us that have been blessed have an obligation that we will be accountable for in the after life (oh wait, that means you have to assume that there is one by which our moral code is based) to take care of those that are truly indigent and cannot help themselves.
In a truly efficient market, social programs would be taken care of by those not for profits whose sole mission is to provide these services efficiently and effectively.
Scott W. Your analogy of the Federal government is just a wee bit off. It is not a creator of an economy but reacts to an economy that already exists. Being a small business owner I would have assumed you had at least a view into ECON 101. Businesses create $$ when they produce a good/service from nothing that is demanded by someone else. GVT simply takes what is already there and re-disributes it. It does not create an economy. There is no doubt that an increase/decrease in spending has a temporary effect, but it does not change the economy... we should have learned this with the pork spending of the last decade. We tried to spend our way out of it... to no avail.
"There is no great demographic bulge signalling a growing market for retirement/assisted living for parents of baby boomers." Under what rock do you live under? What I absolutely agree with you is that Casey's Pond ownership saw an opportunity. They saw Doak with few too many beds to service a community of the size of ours and decided it would be great to capitilize on it versus having them go off to Junction or the Front Range. And to your analogy of Daughter 1, now 62. You are absolutely right! Why would this self-serving baby boomer want to actually help her chlidren like her own "greatest generation" mom and dad did when she got a divorce. She has always made very self-centered decisions, why stop now. I just hope she doesn't expect her gen x or gen y kids to come an see her in the assisted living facility... 'cause they won't.
As far as your view of how well off the boomer generation is... you better take another look at real stats. The picture is not as pretty as you would want to paint it. It seems that you hold some pretty naive views of how well off this upcoming generation of senior citizens is. I'm not going to bury you with studies and stats... it is what I do so am exposed to hundreds of them, but would suggest you do your research... without trying to make it fit an agenda.
Oh yeah another little nugget to chew on when you think about the big picture... the median wage in the US (according to Census data) is around $50k.
Scott... your Census stat is not surprising and probably more alarming than you can possibly know! If you couple this with the income side of the equation things are more than just a little depressing. Think about this lovely nugget. The median retirement savings from all sources for someone in their 50's is around $55 k. The median pension payout (for those lucky enough to have a vested benefit) is around $18 k. Even worse than that is the %tage of retirees taking on credit card debt. The last study I saw was in '07 so I hate to even reference it; but it wasn't pretty even then. How on Earth will the "median" person in their 50's even be able to retire? Even if they draw Social Security it won't be enough, nor will their 401k AND pension. The short answer... retirement (as the silent generation knows it) is dead!
Personally this scares the begesus out of me. I have gone so far as to hypothesize that for the first time in our nation's history we will see life expectancy tables reverse (it is proven that you die younger if you work longer), the value of a college degree decline (20 somethings with graduate degrees are already working as waiters and waitresses... and not in resort towns like Steamboat), and taxes soar through the roof within the next 10 - 15 years.
Real unemployment is at near record highs (not just those applying for and receiving benefits) and inflation, IMHO is being under reported. Think about how much more you are personally paying for things like food, energy, and clothing as a % of your pay than you did 10 years ago.
Couple all of this with huge governmental debt and we are in for a very intresting time. Think about it... what two primary sources does public sector use to determine their "income" stream? Revenues from property tax and revenues from sales tax. Of course there are use taxes, but look at any CAFR and you will see the true picture.
If we are quickly heading to a post-consumer society where is the $$ going to come from to fund even "non-discretionary" spending? Seems to me that this is the real elephant in the room that no one wants to even dare mention. We cannot afford to continue to spend like we have over the past 30 years!
So, yeah, I would say the economy is the #1 concern facing not only Routt County, but our Nation. You think there are lots of foreclosures now... just wait until mom loses her home after she loses her job to poor health.
exduffer: "From the mouth of an expert on wind damage". ROFLOL!!! Isn't Scott the expert on ALL things?
Scott, I do disagree. Field inspectors do peform "uninvited" field inspections which seem to be designed to catch exactly this kind of issue. Did I put up a new pole barn that does not require a permit? Did I tear down an old homestead shed replacing it with a larger one? Did I build a new ag building not requiring a permit? All of these are the purpose of these inspections... it seems that 30 years is more than enough time to have caught a residence and other improvements without me having to tell them how to do their job. Besides, I have no dog in this fight. Our assessment won't theoretically change since the vast majority of our property is used for ag purposes including grazing and hay.
Sedge, I am not debating the value of Ag status for forestry. I am debating the idea that our Assessor's Office cannot even effectively enforce existing rules. Two very similar properties; One Ag Vacant just because it is not easy to get to. It is not Ag Vacant. It is Ag With Residence and has been for 30 years. What makes them think that they will be able to administer a new rule effectively.
From the article: "...search the property database to create a list of ag land with improvements". One of these properties will be affected and one will not. The Assessor has not updated its classification of the properties in 30 years.
So, going a step further. Two of my neighbors are being taxed differently based on what the Assessor's website shows. I know that both these part-time resident owners have 800 and 1,500 ft vacation homes (hunting cabins with electricity, water & sewer) plus out buildings that have been there since the early 80's (Google Maps even show the buildings). But one of them is being taxed as Ag Vacant. Because it is remote with limited access through private property I can guarantee you that an Assessor hasn't been there for over 30 years! These are both sitting on 40 acre lots.
The other 40 acre owner has a tax burden three times theirs based on tax payments. P.S. Neither of these two long time owners have ever used these properties for Ag; even through a sub-lease... they are forest and former lettuce field properties that border National Forest with larger ranches surrounding them. Perfect hunting base camps.
Heb. Cherry picking an issue? Isn't the issue at hand how the legislation that was voted for is implemented; i.e. the usage of dispensaries and the incessant abuse of a law put in place to bring relief to a very small minority of our population. Yes, the regulations allow for dispensaries and I ALWAYS wondered how it would be a profitable business model given the overall health of Coloradoans and our active lifestyles. I am now seeing it very clearly... abuse of the system to the very edge of the law because it NEVER was about providing help for those with a debilitating condition. This is why the backlash toward dispensaries; they are simply the easiest mechanism to control at this point.
Tell me how, in rural mountain towns like SB there are enough residents with debilitating conditions to support not just one but multiple dispensaries? It must be one of the sickest cities in America; that alone should be enough to make tourists second guess whether or not they should visit our fair town. After all, I would be concerned that my lift operator (insert job function if you don't like lift operator) is going to collapse on me if he/she is 20 something with a debilitating condition that requires constant treatment via a controlled substance. I would have the same concern if this same 20 something is popping pills or drunk. In fact, if he/she showed up drunk his/her arse would be fired.
To say we don't get to vote on how the regulations are implemented is a farse. We have representatives in place to ensure that the regulations are implemented in the manner in which they were presented. If they are not, it is our responsibility to vote them out and vote in those that will.
P.S. I wasn't asked to fund "illegal wars" or "tax loopholes" because I have a representative Federal government that is supposed to watch out for my best interest... to the extent that they do not I cast my vote to boot them out as it is my responsibility to do and something I do every election cycle. I WAS specifically asked to legitimize a previously illegal (it still is illegal at a Federal level) controlled substance to provide relief of pain for those suffering debilitating conditions; not the recreational usage of the same substance. To the extent that my representatives in Denver do not execute on my wishes they should be voted out. To the extent that it is not practical to reverse the mess they have created, we have a responsibility to enact further statutes at a local level to control EXACTLY how this should be implemented.
Therefore, until the pro MJ crowd can provide a viable solution to implement the law as it was presented to the people with the intent that was advertised to the people I will be voting to close every dispensary in the County as an option comes up to do so. Those who NEED the medication will still be able to obtain it.
Last login: Tuesday, September 17, 2013
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