Impending Stock Market Crash: Time Is Short, Too Many Problems To Solve. The Fiscal Cliff Negotiations Are Failing. If US Can’t Avert Fiscal Cliff, Everything Will Collapse!


IMF Chief Christine Lagarde Warns U.S. of Worldwide Effects of Fiscal Cliff

from Guardian.co.uk:

International Monetary Fund chief Christine Lagarde has warned the US it has the potential to be its “own worst enemy” over the fragile economic recovery and that failure to reach a comprehensive settlement over the fiscal cliff could see growth plummet to zero.

In forthright comments over the impending fiscal cliff, the IMF managing director said that “if the US economy was to suffer the downside risk of not reaching a comprehensive deal, then growth would be zero”. The markets would react quickly, “and the stock market would take a hit,” she said.

All the current signs of optimism over the economy that she identified – including falling unemployment, the housing sector bottoming out and reduced household debt – would be negated.

Income tax will exceed 50% in California, Hawaii, and New York City

Moody’s: It’s deal or die

from Bloomberg:

If Congress were to “kick the can down the road” by extending the current tax-and-spend policies, Zandi predicted the US would lose its Aaa rating because “it would signal that the political will is lacking to put the nation on a sustainable fiscal path.”

 

The Fiscal Cliff Is Set To Clobber The Middle Class With Nearly 50% Tax Rates

from moneymorning:

If I didn’t know any better, I’d think there’s a small but growing group of people in Washington who think it would actually be good if we temporarily went over the fiscal cliff.

I say that because I am seeing a smattering of articles recently suggesting that somehow going over the cliff “won’t be all that bad” or that we’re “really just talking about cuts that need to happen in the first place.”

President Obama seems to think the same way judging by the fact that he’s dug in his heels, telling the GOP there will be no fiscal cliff bargain that doesn’t include tax hikes.

Now noted budget hawk Republican Senator Tom Coburn has broken ranks, noting that he’d rather see rates rise because that “will give us a greater chance to reform the tax code and broaden the base in the future.”

I find that to be an absolutely appalling argument given how much further the president’s proposals will squeeze the middle class.

As Fox Business Network’s Gerri Willis, an expert on consumer and personal finance issues, recently pointed out to me, the average middle class tax rate is already 43.12%, according to the non-partisan Tax Foundation.

Beyond that, Willis says if we do go over the cliff, the average middle class tax burden jumps to nearly 50%.

 

Fiscal Cliff 2013: Debt Reduction and Cliff Avoidance Are Two Separate Issues

from policymic:

The fiscal cliff negotiations are failing because both parties are seeking to solve too many problems in too short a time frame. The fiscal cliff and plan for long-term debt reduction are two totally separate issues, which call for solutions inherently opposed to one another. These solutions include raising taxes on everyone, and reducing entitlement programs. To achieve these goals, we need congressional bipartisan cooperation and presidential leadership.

Simply put, to avoid the cliff, Congress needs to find a way to tax less (by extending most rates) and spend more (by maintaining current outlays). Long-term debt reduction, on the other hand, calls for narrowing budget deficits through higher revenue and lower levels of spending.

Time running out on ‘fiscal cliff’ deal

from washingtonpost:

The contours of a deal to avert the year-end fiscal cliff are becoming increasingly clear. But progress has been slow, and time is running out for leaders to seal an agreement and sell it to restless lawmakers who so far have been given little information.

With hope still alive for a resolution by Christmas, President Obama and House Speaker John A. Boehner (R-Ohio) met Sunday at the White House, their first face-to-face meeting in nearly a month and their first one-on-one session since July 2011, when they last tried to forge a far-reaching compromise to tame the national debt.

 

2013 Federal Income Tax Brackets, Show This To Anyone That Believes That Taxes Are Too Low

from beforeitsnews:

Individual Income Taxes and Payroll Taxes make up 81% of Total Tax Revenue. That’s 81%  from you and I, along with our employers and small businesses.

In 2013 it is going to get even worse. The 2013 Federal Income Tax Brackets listed below will show you 3 possible scerarios for what to expect for tax increases next year and yes it will affect everyone who earns any type of income.

While Corporations that have lobbyist in Washington D.C. pay only  9% of total tax revenue, yet they brag of record earnings year after year. Handing out unimaginable bonuses to their executives.

Raising Taxees is not the answer, cutting the size of government and cutting reckless spending is the solution.

Here are the tax increases you have to look forward too this year.

Congress has not yet made clear what the situation will be in 2013, The Tax Foundation can only make predictions about the coming year’s tax rates.

These are the three most likely scenarios for 2013 tax brackets:

  • The extension of the Bush-era tax cuts for all taxpayers.
  • The expiration of the Bush-era tax cuts for all taxpayers.
  • The expiration of the Bush-era tax cuts for taxpayers with high incomes.

Because these three proposals already exist and are detailed enough to draw predicted tax brackets, it’s easy to present the scenarions and be relatively confident about the results for taxpayers under each.

 

Scenario 1: Tax cuts under the extension of the Bush-era tax cuts for all

Rate Single Filers Married Joint Filers Head of Household Filers
10% $0 to $8,950 $0 to $17,900 $0 to $12,750
15% $8,950 to $36,250 $17,900 to $72,500 $12,750 to $48,600
25% $36,250 to $87,850 $72,500 to $146,400 $48,600 to $125,450
28% $87,850 to $183,250 $146,400 to $223,050 $125,450 to $203,150
33% $183,250 to $398,350 $223,050 to $398,350 $203,150 to $398,350
35% $398,350 and up $398,350 and up $398,350 and up

Scenario 2: Tax brackets under the expiration of the Bush-era tax cuts for all

Rate Single Filers Married Joint Filers Head of Household Filers
15% $0 to $36,250 $0 to $60,550 $0 to $48,600
28% $36,250 to $87,850 $60,550 to $146,400 $48,600 to $125,450
31% $87,850 to $183,250 $146,400 to $223,050 $125,450 to $203,150
36% $183,250 to $398,350 $223,050 to $398,350 $203,150 to $398,350
39.60% $398,350 and up $398,350 and up $398,350 and up

 

50% political risk premium that is not being priced into stocks

from zeorhedge:

As the chart below from Citi’s Matt King shows, a correlation between BBB spreads and a broader proprietary uncertainty index, there is currently a roughly 50% political risk premium that is not being priced into stocks.

 

Did you already share this? No? Share it now: