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Saturday, September 24, 2022


The Dooh Nibor Economy (that’s “Robin Hood” backwards!)


As I'm doing some research, I come across some interesting things.

There's a great WSJ blog called  "The Wealth Report" by Robert Frank, who wrote an excellent book called "Richistan" in which he makes a case that the world's wealthy have essentially formed a shadow (let's call it virtual as it sounds nicer) nation "where the top 1% control $17T in wealth, have their own health care system (concierge doctors), travel system (private jets, destination clubs) and language. (”Who’s your household manager?”)."

As this chart shows, the US is cranking out multimillionaires at a record pace with super-rich (more than $10M) households doubling in the past decade.  What's scary is that doubling the amount of people who have more than $10M per household (from 300K to 600K) means there's $3,000,000,000,000 less available for the other 98% of the of the households as MONEY IS A COMMODITY and can only be possessed by one person OR another.

Another 5M households gathered up $1M of wealth for another $5T and our nation's 1,000 Billionaires added another Trillion desperately needed dollars to their household budgets to pay for, according to travel and liesure; Yacht Rentals, Villa Rentals, "Experimental Excursions", Luxury Cruises, Vacation Home Rentals, Spa Services.. (and have you seen the price of Cristal these days?).  The cost of the AVERAGE high net worth individual's summer spending on these luxury items was $1.2M.


Summer Activity Average Planned Spending
Yacht rentals $384,000
Redecorating $129,000
Villa rentals $106,000
Experiential excursions $103,000
Jewelry/watches $94,000
Luxury cruises $92,000
Charitable giving $82,000
Vacation-home rentals $82,000
Out-of-home spa services $61,000
Summer entertaining $56,000


While you hear a lot of talk of wealth creation for all, our M1 money supply (before the Fed stopped measuring it's out-of-control growth) was adding "just" $1Trillion a year to the global economy.  If the wealthy households gained $9T in value over the past 10 years, EVEN WITH THE FED MINTING AN AVERAGE OF $500B PER YEAR IN NEW MONEY, then the other $4,000,000,000,000 HAD to come out of the other 98% of US households.

investOne of the great tricks of our economy is that there are avenues of wealth creation that are available to those of us who are already rich that are denied to those of you who aren't.  Only 1% of a Prince and Associates survey of high net worth individuals between $5 and $10M invest in ETFs and only 17% invest in mutual funds, NONE of the investors with more than $20M in assets invested in mutual funds, which are the new "opiate for the masses" but that's a whole other article I will write!  76% of the super-rich (> $20M) invest in hedge funds (Ka-Ching for me!) and another 36% invest in my other enterprise, start-up companies privately and through venture capital firms (and you think I just choose these professions at random).

Obviously, if you have less than $1M in household income you are essentially prohibited from investing in hedge funds due to government restrictions aimed at keeping out the riff-raff protecting the small investor.  This game is rigged so that the bottom 90% are forced to put their money into "safe" investments that return 3-10% a year while the top 10% take that same money and roll it into investments that make over 20% per year.  Just ask a person with less than $500,000 in net worth (there's 295M of them in this country) how much money the dividend tax reduction saved them…

I'm not going to get into a doctoral thesis on the subject but here's a quick example of how the Dooh Nibor economy works:

  • Donald Trump (and no disrespect to The Donald as I love the guy, but he's a good example), one of our 1,000 Billionaires, spends $1.2B to put up 1,000 new condos in Manhattan.  He sells those condos for $2.2M each to 1,000 of our nation's 1.8M people who have $10M or more, pocketing an extra $1Bn for all his hard work. 

    • Since nice condos "only" cost $1M just 7 years ago, the poor multimillionaires must figure out how to come up with an extra 10% of their net worth in order to maintain the "Trump Lifestyle."  Let's say they earn $500K per year and need an extra 50K – doesn't seem like much does it?

      • They in turn raise the prices they charge to 1,000 of their clients (the 150M strong "middle class") by 10%.  These people are the doctors, lawyers, store owners, white collars, etc. that you do business with every day.

        • That forces the middle class, who can barely afford their lifestyle to pass that 10% on to each other, as well as the 120M Americans who have household incomes of less than $48,000 a year, many FAR less than that in the form of vital services they can't live without.

That's how your housekeeper, who spent $3.20 per gallon to fill up her tank in order to clean your house for $10 per hour, ends up paying for the Trump condo she's cleaning.  It's a nickel here and a dime there but when you pick the pockets of 270M people for "just" a quarter a dozen times a day that's $3 x 270M x 365 days = $295Bn a year.   Multiply this petty theft over a 10-year period and that's how you move $3T of our missing $4T from the poorhouse to the penthouse – Dooh Nibor!

All this would be fine if we were equally creating wealth among our lower classes but we are not.  In fact, the median hourly wage for American workers has declined 2% since 2003 after accounting for inflation.  Inflation has, in fact, outpaced income for workers earning up to $80,000 per year, (the bottom 90% of our country).  The top 1%, meanwhile, made "just" 8.7% of all income in 1996 but made 11.2% of it last year, a 28% increase for the decade or $325Bn a year extra going to 1M very happy households.

Should we (assuming you are lucky enough to be one of Mr. Trump's potential buyers) care?  For every one Robin Hood there was a very rich King and his whole court, the wealthy Sheriff of Nottingham and his crew…  even Maid Marion had her own maids – it's human nature, it's the way of the world, it's the natural order of things…

Or perhaps not.  Mr. Frank points out that Bill Gates said in his Harvard address (he is a proud drop-out) "Humanity’s greatest advances are not in its discoveries — but in how those discoveries are applied to reduce inequity.  Whether through democracy, strong public education, quality health care or broad economic opportunity — reducing inequity is the highest human achievement.”

Frank points out that Gates is carrying on in the very sensible tradition of John D. Rockefeller, the wealthiest man of his time, who turned philanthropic later in life in order to address the inequities he saw in the system.  A cynic may say that we (those of us who worry about the well being of the classes below us) are simply trying to escape the fate of the Romanovs, Louis XVI and countless others throughout history who found out there is not enough padding in your wallet to save you when your backs are pressed against the wall by an angry proletariat.

While it's true that there is a certain level of cost-effectiveness in keeping the poor in line (at some point you end up paying more for security guards than you can squeeze out of the angry mob in profits) and that America is the greatest country in history at placating the poor (all you need is a dollar and a dream!), at some point we should, like Gates, seek to lift our brethren off the floor.  It may be a long-range view but, as any chart watcher will tell you, it's good to consolidate your base at higher levels. 

Turning from Dooh Nibor to Robin Hood won't be easy.  Lifting the lower half of our society to new highs will take a huge effort and even some sacrifice on the part of the top 1%, but it will allow more of us who are close to the top to rise as well – and that's a good thing!


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Another excellent read Phil, thank you. Your comments such as these are one of the things that makes this site so special. I cannot disagree with anything that you have said, except that I think you may be a bit more optimistic about the resurrection of Robin Hood than I am. I recall the folks here a few months ago who argued against any minimum wage at all. It brought home to me shockingly how differently we can see the world.

Well said my man.
What difference does it make to the dead, the orphans and the homeless, whether the mad destruction is wrought under the name of totalitarianism or the holy name of liberty or democracy? – Mahatma Gandhi

I know not what weapons World War III will be fought, but World War IV will be fought with sticks and stones. – Albert Einstein

Wherever there is great property, there is great inequality. For one very rich man, there must be at least five hundred poor, and the affluence of the rich supposes the indigence of the many. – Adam Smith

Only when the last tree has died and the last river has been poisoned and the last fish has been caught will we realize we cannot eat money. – Chief Seattle

When a man tells you that he got rich through hard work, ask him: “Whose?” – Don Marquis

[C]orporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign… until all wealth is aggregated in a few hands and the Republic is destroyed. – Abraham Lincoln, 1864

When I give food to the poor, they call me a saint. When I ask why the poor have no food, they call me a communist. – Dom Helda Camara

In outer space you develop an instant global consciousness… From out there on the moon, international politics look so petty. You want to grab a politician by the scruff of the neck and drag him out a quarter of a million miles and say “Look at that, you son of a bitch.” – Edgar Mitchell (Astronaut)

An imbalance between rich and poor is the oldest and most fatal ailment of all republics. – Plato

The essence of the problem is about consumption, recognizing that a society that consumes one third of the world’s resources is unsustainable. This level of consumption requires constant intervention into other people’s lands. That’s what’s going on. – Winona LaDuke

You must not lose faith in humanity. Humanity is an ocean; if a few drops of the ocean are dirty, the ocean does not become dirty. – Mahatma Gandhi

The real measure of your wealth is how much you’d be worth if you lost all your money. – Unknown

Phil, as always I enjoy your weekend writings. It is nice to talk about correcting ‘inequities’ in the world while your in a position of strength, but it begs the question, for those who are not endowed with such strength (wealth) and who are not truly dependent on the generosity of the wealthy (such as the large middle class you alluded to), should the state intervene?

Phil writes:
Lifting the lower half of our society to new highs will take a huge effort and even some sacrifice on the part of the top 1%……and…..MONEY IS A COMMODITY and can only be possessed by one person OR another.

While money may be a physical commodity, wealth is not. Wealth is created, and it is not the job of our government to decide where and to whom it is “distributed”. “Distribution” creates no incentives, and discourages people from working their way up. The only job the top 1% have is to create jobs so that the lower income folks can begin to work up the latter. If you really want to fix the poverty problem in this country, eliminate the welfare and other entitlement programs and let people learn responsibility.
We see in the above article, that the government is again the problem in prohibiting average investors from accessing the same investment vehicles that the rich do.

There is one common theme is all of this.

The government cannot help, it only exacerbates the problem.

“All this would be fine if we were equally creating wealth among our lower classes but we are not.”

As a general comment, the middle class tends to achieve and accumulate the trappings held by prior generations’ upper class. This runs from indoor plumbing to flat-screen TV’s and ABS breaking systems. It can be an unattractive process to some degree generating jealousies, and sometimes too slow, but it is a positive process as it stirs innovation, and entrepreneurship.

The US economy is an optimal, far from perfect, means to achieve the highest quality of life to the broadest base as possible – measured by shelter, food, and the “opportunity” to succeed – “life, liberty, and “pursuit” of hapiness”, which is all we’re reasonably entitled.

Constant vigilance of the ‘wealthiest’ is necessary, to be sure, and toward that notion I would like to see a crackdown on the Greenwich, CT crowd that is busy bidding up the cost of crude at the expense to 99.999% of us

But, to really achieve an “more evened” playing field among the classes, we need to breakdown, shake-up, and re-constitute the US Education system – from K throguh University – and demand a real return for what we as a nation invest, particularly as International borders become more meaningless.

Let’s face it, we live in a nation where the poorest suffer from ‘obesity’ and ‘idleness’ – not the lack of a hedge fund account or a ferrari.

I live in a locale with some of the highest US property values yielding huge local property taxes for a declining school-age population, and yet students ocassionaly need to photocopy textbooks and the HS graduation rate is 50%, despite a funding allocation of approximately $250,000 per classroom of 25 students.

-This is a greater concern to me than any obscene spending by the wealthiest. But, up-ending the “good-willed” teachers of our nation is not a populous movement, and since the education system organizes itself and votes, expect this ‘benign neglect’ to continue.

But it seems to me that the Nation’s energy would be better spent ‘really educating” our youth, and not throwing good money after bad while blaming the poors’ condition on the wealthiest.

Happy Father’s Day Weekend, everyone!

Wang’s World
new post up!!

Phil – One of the things that drew me to your site in the first place was the great writing… Ok – the high returns kinda pulled me in too.

As far as the rich soaking the poor – when I consider the question, the answer always comes back to motivation. What someone does can be judged more by the motivation of the act than the act itself.

I think the rich getting richer is just the product of a system that caters to success. I think the boys in DC waste our money like crazy, and its so blatant that they should be kicked out immediately and that system overhauled. But for the run of the mill rich guy, he is simply working the system as he should – if he chose not to then that would make him a fool. Sure there are those who wake up in the morning and look for ways to bilk others to enrich themselves — but we cant lay the supposed transferrance of wealth to the wealthy off as the fault of the wealthy.

I work in a field where my job could very well be outsourced to India (although theyll never replace my talent). So on that theme, whose fault is it that we in teh IT biz arent gettin raises anymore, and our jobs are being axed in favor of cheaper labor overseas ? Whos fault is it that while the perceived worth, as measured in dollars, of my job is going down, while the perceived worth, as measured in dollars, of my CEOs job is going up ? I would be tempted to say that the rich are gettin it over on the middle class again — but its just not true. its about motivation. To not increase margins in a public company when and where prudent (not thatthe extent of the outsourcing is actually prudent) would be corporate suicide. Should it be regulated ? NOOO !. Its not the fault of the rich that this is happenning, no matter how unfortunate it is. This country simply cant afford to /not/ let the global talent pool work for it.

I grew up poor. I grew up rich. My mother was dirt poor, but she gave us the richest gifts that can be given – a value system, truth, and love. I will never /not/ be rich in that sense, regardless of what my bank acount says.

The system in this country has gotten so screwed around. Schools for instance – its the schools job to provide an environment conducive to learning, and to present the material. Its the parents’ job to get the kid to learn. Whats wrong with the system when a teacher cant enforce discipline ? Whats wrong with a system where kids are gettin passed because failing them would hurt their self esteem ? It means that particular system has gotten so skewed that its finally completely backwards !

Whats wrong with a system where the strong ethics and values are just plain not in vogue anymore, but rather have been replaced by rampant consumerism ? You take your average lower middle class person and put them in this place, and feed marketing to them day and night and they get brainwashed by the marketting that is telling them how to be happy – be happy by purchasing our product ! Geez I think im in the wrong line of work ! THey purchase and purchase and purchase, and they just never quite get happy or affluent — all they get is an 18% debt that hugely outstrips their income. The weak-minded and weak-willed will always be marks. Perhaps its darwinism at its worst.

Our system has slowly morphed into one where there is one thing that is important – posessions – money, things, power, the latest model car. The commercials tell you what you need to do,a nd you feel bad if ur not thin, or not driving that new car, or owning that nice house. None of its true.

The bottom line is that there are all kinds in this country – those who are willing to do the work necessary to get on the gravy train generally will succeed at some level. Those who get comfortable in poverty will always remain in poverty, no matter how much money we shell out to em. THose who constantly blame their failures on ‘the system’ or others without introspection into their own role (the masses are growing too) will never learn anything – and never grow, either inside or out. These are the group I suspect does the most rich-bashing.

There is that small slice who genuinely need help – but I consider that slice to be small.

I guess my bottom line (is there a bottom line to all this meander?) is that as wiht most things, the truth of the matter (and truth is my main goal in life) lies somewhere in the middle.

We cant keep twisting our system around to cater to failure. We have to give from our hearts, not by decree. THis country is already becoming sadly mediocre for many reasons – we dont need to take it the rest of the way down by making socialism a priority.

Get on the gravy train and work ur ass off -=- but dont do it out of envy – envy is based on a lie that all these people with all these things are happy in life.. Instead do it out of truth, and out of a desire to improve yourself and your family. A desire to grow and a commitment to ‘add value’ to the world. Youll make yourself rich beyond monetary value – and the funny thing is, the money will flow in all on its own.

Thanks again for the great site.

Lookin forward to tomorrow.

djczing – That’s the best writing on this subject I’ve seen to date. I wrote a long piece that was somehow lost and said many of the same things, though not as elocuently as you did. I’ve been pretty pessimistic about the future of this country, but if we can find more people like yourself, who see things as clearly as you do, maybe we can change things.

Our politicians won’t change anything. Most, I’m sorry to say, are corrupt and self-indulgent. They only care about their next election and keeping the money flowing in. Make no mistake about it, a politician works almost full time making sure he/she will have the funds needed for their next campaign, or that cushy consultant job after their final term. And I’m talking about both sides of the isle. Neither party has a claim to ethics. I’ve spent time in D.C. and have had opportunity to get to know many of our elected officials. Other than a few devoted public servants, I would give you a wooden nickel for the bunch of them. I wouldn’t have believed how outright crooked most of them are unless I saw it for myself. Oh, and I’m afraid to say, our highest military leaders aren’t any better.

In the meantime we have crime running rampant in urban slums, people afraid to come out of their houses, and rich attorneys making sure they don’t pay for their crimes because they are victims of society. In your writing you committed a terrible offense. You blamed poor people for not taking responsibility for their own lot in life. Now that’s just not politically correct! It has to be somebody else’s fault that kids are dropping out of school at record numbers. It has to be somebody else’s fault that poor teenage girls are getting pregnant at 13 and 14 years old. It has to be somebody else’s fault that jobs go wanting in my neighborhood while I see young working age men and women hanging on corners instead of taking those jobs. It must be somebody else’s fault that drugs are destroying our youth. Yeah, it must be the government’s fault and big business’ fault and rich folks fault.

And the government? Forget it. They are becoming less and less relative. The more they hurl stones at each other, the less they accomplish. Their goal is to cater to whoever they think they can get votes from. So they make promises of wealth redistribution and name the rich and powerful as enemies of the state. Just to get votes. It’s pathetic.

So what do we do to change things? It’s time for those of us who care about the futue of this country to stand up and say, “We’re not going to take it anymore!” End all this political correctness and acknowledge that there are problems and people have to take responsibility for their own conditions in life. If we don’t do something soon, we’ll lose this great country we have.

I know some will say I must be some kind of right wing nutcase. That’s okay. At least I know I am seeing things the way they really are.

In the meantime we

You comment:

“Get on the gravy train and work your ass off”

That is easy to say but in reality impossible to do for a majority of workers who, for whatever reason, do not have the education and skills to find and work in jobs that pay a decent wage. It does not help to say that they should have stayed in school, learned a trade, or whatever, because since they did not, they are with us now and it is too late for them and they are a majority – decent but poor with few or no prospects, they just hope to make it through day to day without getting behind any more than they are already while still trying to enjoy and get the best out of their limited life style. One hit can set them back immeasurably, they are lucky if someone, perhaps family, can assist them but many lead a tough deprived life that most of the people on this site have not experienced, perhaps they can described as you described your mother, dirt poor.

For example, I have five grown up children, the oldest made his first million by the age of forty and his sister is not far behind, a son born third enjoys a good professional life employed at one of North America’s leading universities and the youngest, a male, makes a decent living with a senior management position in advertising, but that’s a field and a job that entails some risks and uncertainties, for him I keep my fingers crossed and have some worries – but now about the fourth born, no less smart than his siblings, no less decent, never a trouble to my wife or myself, but he is the one that did not do as well at school as the others and he is one that I neglected or at least did not succeed in bringing him along properly into the workforce and in him I see the plight of the majority I referred to earlier – no skills, no educational qualifications to get anywhere, at thirty eight years old now the only work he can get, and has had for years, pays so little, with no benefits, no sick leave, no health care, no paid holidays or paid statutory holidays, no job security or compensation if he has an accident – he is just like the migrant workers, and one of the working poor, as are the many who work in the same and other industries as he does. If you travel on the subway or bus line in rush hour, there in the crush of people, of all denominations you will see your fellow citizens, decent people who are just getting by who cannot, as you say,

“Get on the gravy train and work your ass off”.

Well… Theres 1 movement Ive wanted to start – the only one I could think of that has any /hope/ of making a difference. Of course taking up arms is unthinkable for an American patriot – and not too practical…

What would work though would cause unmitigated bloodbath in Washington. ALot of innocents (wait ! there /are/ innocents there ?) would probly get bloody too, but until things improve, keep doing it – in bulk, and wihtout thinking.

Vote non-incumbent (sp?). Across the board. Scare em back to the reality of who their boss is. Do it in a big enough chunk to scare em. Get a voice that they will listen to thats louder than the pull of their vices and self-dealing.

Keep voitn em out til real change and commitment to needed sacrifice is made.

Im starting to see that apathy isnt a viable stragedy, eh ?

Hi Jim –

Yeah I see where you are coming from. I also know some who are trapped living in a ‘rich-mans’ infrastructure on a poor mans wage.

Will raising the minimum wage to some level actually help them get above the poverty line ? I have a sister in NY (northern NY, not the place where all their taxes go to) Her crime was getting pregnant at 18. Boom. Stopped her life in its tracks. Whats she gonna do ? She did get a job providing hospice, but still is in the trap. I dunno – Id suspect the family will come through for her. I have some freinds from high school who never left Smalltown, NY, seeing that tending bar at the local pub would surely satisfy their monetary needs for awhile. Some of em are still tending bar.
THese are all trapped people, granted. SOme accepted their fate from the start, some fell into it out of misfortune, or bad choice.

I believe everyone is a product of their choices. A bad choice and coincident bad luck can be life-lethal.

As I said, Darwin at his worst.

Part of my point is that we cant fix it by legislation and programs. The waste and abuse, along iwth the increased abuse due to the new and ‘lucrative’ rules would make it just another government program, paying at least as much to hold its bloated bureacracy up as it pays to the indigent(sp>?) anyway.
We all need to give more – its as simple as that. We give through the government and the needy get $.50 on the dollar. We start a viral giving campaign (hey ! entertainent is now viral – why not ?)

Maybe we create an oversight entity who has political pull and lobbies exclusively to funnel confiscated money (hey ! backdated stock option punishment!, and frivolous earmark punishment !) and other bad business directly to the cause of the poor – wash some bad money.

Theres no perfect fix – but there is a most imperfect fix that we should stay away from, after proving over and over again that it cant work.

I thihk I also understand the grief you are feeling as a parent — and I know it wont help to tell you that its natural for you to blame yourself, but judging by your other ‘fruit’ id say you are probly being way overcritical of yourself. Sorry to presume…

hi Phil and all,

I have to agree with the others in that what i like best about your site are the editorial articles.This time you’ve opened a can of worms which can be a good thing so long as we keep it real.

A couple of weekends ago we were at Willows Beach near Victoria B.C. looking across the straight to the Olympic Mountains in Washington State and I was amazed at the number of large container ships going into the port of Vancouver,one about every 10 minutes.This would be nothing compared to what goes into Seattle but made me realize that we have a massive problem with over consumption and that this golden industrial age (for us) just can’t go on for ever. Global warming would be a leading indicator here….

Another thing that happened at work just recently is also of interest.We(as in fellow machinist tradesmen) were having our lunch out side at the picnic tables on payday when Pat found an old pay stub from year 2000 on the ground.
I said “Pat, what’s the the net pay and the hourly rate?”He answered “$1400 at $25/hr” (thats without the benefits) .We now earn $28.68/hr in 2007 and take home a net pay of about $1425 every 2 weeks….
with a higher tax rate and yearly inflation running ar 2-3% we’re not even close to keeping up so I don’t wonder why my paycheck seems to buy less and less.

Anyway,just thought I’d put my two chips in.The good news is that the Nikkei is up 201 points tonight,the Hang Seng is up 465 and Monday will likely be up up and away just like Mary Poppins…(and what goes up must come down)

Goodnight all, Mike

Reminds me of the 10 guys going out each week for dinner analogy:

Dinner costs $100 each week and doesn’t fluctuate in cost regardless if less than 10 persons are present per an agreement with the restaurant’s owner.

The ten split the cost of the meal as follows:

Persons 1 and 2 pay $ 0
Person 3 $ 2
Person 4 $ 3
Persons 5-6 6 each $ 12
Person 7 $ 11
Person 8 $ 15
Person 9 $ 18
Person 10 $ 39

Total $100

Owner comes over to their table one night and says in thanks for your patronage I am going to reduce the cost of your meal next week and from now on to $80. So it is agreed that the cost to each of the ten will now be:

Persons 1 and 2 pay $ 0
Person 3 $ 0
Person 4 $ 2
Persons 5-6 6 each $ 10
Person 7 $ 10
Person 8 $ 13
Person 9 $ 15
Person 10 $ 30

Total $ 80

After a couple of weeks paying these amounts all but the 10th person start talking together and saying how unfair it is that the 10th person is saving 9 dollars while the biggest savings any of the others individually have enjoyed is only $3. They become so upset that after the next meal together they beat up the 10th person in the parking lot.

The next week person 10 doesn’t show up so an argument over how much each person needs to pay entails because persons 1-3 who hadn’t paid in the past; didn’t bring any money and left. Dividing $80 by the 6 remaining persons with money averaged out to mean each would pay a little more than $13 each. Persons 4 through 7 screamed this would amount to an almost 50% increase, refused to pay more than the usual amount, threw their $22 on the table and also left. Persons 8 and 9 scrimped together $29 each, knowing they would be spending money not budgeted, which would mean they would need to apply for a loan the next day to make up for the shortfall, and would not be able to afford dinner next week. The weekly dinners stopped.

Moral of the story? Those that pay the most tax before and after a tax reduction should not be chastised without understanding the monetary consequences that could occur if off shore tax havens and non resident tax status are employed by those persons. We need person 10 to come to dinner!

Asia Markets : Monday, June 18, 2007



Hong Kong*


DJ Shanghai*






* at close
Sources: Dow Jones, Reuters


Regarding Canada and it’s top rate of 29% for income tax can’t be the reason more of our billionaires don’t hop over the border; you forgot all the additional taxes besides the income tax, needed to pay for the gov’t sponsored “free” health insurance, etc. that accumulates to an almost 60% cumulative tax on a median Canadian income earner (and then they still have to wait months on a list for critical health testings, so many end up coming to the U.S. and pay now for medical procedures, so that they will be alive to utilize their free health benefits in the future). The 60% cumulative tax rate is the hindrance for any U.S. citizen, and is the primary reason for Canadians, to switch tax residency. (Preventing mass departure of its citizens is the real reason Canada suggests we limit immigration (and you thought they meant just middle east immigrants?), but not quicker green card issuing policies.) 😉

I am all for a flat tax or a VAT being the taxing method used, with exemptions on certain foods, housing and utilities, to replace the current tax system. Although it makes the most sense, and can be shown to be the least costly to collect and generate revenues in excess of the current system; the chances of its adoption are, imo, slim to none. The uneducated and poor will be misled by the poverty pimps of Jesse Jackson, Al Sharpton and others, to believe it is just another benefit being given to the rich white guys. The existing tax agency (IRS) won’t be in favor of it (where are the current 104,000 IRS employees going to work?). The AICPA, ABA and all other industries who make their livings from the current tax system will be in opposition (and have the resources enabling effective disinformation to prevent enactment).

Now try to find enough congressman to simply form a committee to produce a bill that both Houses will pass. It would end up being political suicide for any committee member, so the committee won’t be formed and the necessary first step in a bill enactment process won’t occur.

It’s sad, but true. The power of persuasion that money provides allows many inefficient systems to exist and assures their continuation.

AAPL- longer battery life showing up $2.90

Phil: OK Im convinced – its all you rich peoples’ fault. I demand recompense !

To that end, Ill email you my address, and you all can take up a collection for me. Please dont bother with anything less than 10%

and thanks in advance !

Morning all,

GILD – Gilead Sciences Inc. said Friday the Food and Drug Administration has approved its ambrisentan tablets. Foster City-based Gilead (NASDAQ:GILD) said the drug, called Letairis, is designed for once-daily treatment of pulmonary arterial hypertension.

Announcement came after hours Friday, and stock was up $1.3; pre-market today up $0.93.

The death of great republics had to do with fiscal manangement not the inequity between wealth classes.
Here’s what happens: once the class that has less figures out they can vote into office the people that promise and deliver the most ($$$, benefits etc)…..then those multi-term squatters keep giving the people what they want. That soon leads to insolvency….then instability……then chaos….then anarchy…..then a radical change in the shape, form, and process of the “new” government.

ONE of the first answers to to this problem is TERM LIMITS ……never did the framers of the Constitution envision professional politicians- in office for 20-30-40 Years ! Government was supposed to be run by normal, honest hard working people.If we got rid of multi term possibilities….it would be simple- you get 4-6 years to get it done and then YOU ARE OUT. No more late term lying,wavering,over-promising and out right prostituting yourself to get re-elected.

Since none of our term squatters has the figuative balls to put through and pass term limits (why would they want to get off their own gravy train)…..then we go with what the poster above noted- VOTE NON-INCUMBENT. Maybe that should be the theird party….since our other third party does not work.

FLAT TAX —YES….YES….YES. I just don’t like the fact that we can solve our problems by turning over the funds to a system (our government) that is horrifically wasteful, corrupt and makes things 2-3-4 times more expensive then they need to be.

Amazing discussion. First, a whole hell of a lot has happened since this post was fresh. I wonder if opinions would change today…  This is the most intelligent and reasonable discussion of our problem that I have ever read. People like you folks (and I’m not sure I recognize any of these names on PSW today) should get together and figure out what ought to be done. I sense strong beliefs and open minds. Let me say a couple of simple things, although I suppose I could write a book. If you give stuff to people who need it, the odds are, overwhelmingly, that despite the gift, nothing about their lives will change for very long. THIS is the thing that needs examination. You absolutely have to change how that happens.
I have done well in my life. I compiled a small fortune without ever earning into the top income tax bracket – the old time life style. Modest consumption, intelligent choices. My mistakes were small ones, not repeated. End of story.
My wife’s family is not anything like her. While willing to work hard, they made some heavy mistakes, and despite a lot of sound advice, repeated several of them, and continue the process to this day. They started life at the edge of the middle class, and now all of them are poverty-stricken. It becomes tiresome to listen to request after pathetic request that we bail somebody out of the deep stuff, once again. These lives will not ever change. Nothing will improve. All receive government benefits of one or many types. Still, they are penniless and can’t tolerate a single setback. These are well-meaning and honest individuals. They simply will not deny themselves anything they want. Ever. Only total lack of funds stands in their way. So they defer bill payment until the repo man arrives at the door – then they want the bailout.
Now, I’m willing to help prevent them from going to jail or starving, or having the heat turned off in February. I sure don’t need the government telling me I gotta send more money to wherever, so they can do the same thing for millions more people. WE DO NOT HAVE A CLUE how to help these people. I grow tired of flushing my savings down the toilet in such a blind and temporary effort.
So, all the talk about education, minimum wage, progressive taxation, VAT, all familiar policy issues – WE DO NOT HAVE A CLUE how to change the way the "disadvantaged" live. Lets work on that problem first.

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