Even for us intellectuals it’s hard not to get worked-up by the media which rarely states facts without bias. If we want a larger intellectual crowd which will be a little more idiot-proof to channels like MSNBC and Fox, then we need more educated people. Free CC for 2 years would help. It sounds crazy at first, but those people will most likely enter the work force after college and contribute to the economy instead of being fed by Uncle Sam.
“Much of the 47% pay payroll taxes (nominally for Social Security and Medicare).”
They also pay sales tax and likely property tax (a portion of their monthly rent usually goes towards that if they don’t own their own home.)
In my case, that is not correct.
I readily acknowledge both sides, conservative and liberal, partake in the same uses of making money. I mentioned Heinz only because she is a figure who HAD to release her taxes, so it is readily provable to the crowd whose intellectual knowledge runs often only as far as Google. The one thing about the people on CC is they hide behind if it is not on Google then it must not exist, as a way to not have to deduce or think.
One thing though that wealthy people have in common is they are not dumb enough not to continue to make money regardless of what party affiliation they are in. And irrespective of party, they will stop anyone who tries to take their money away.
The rules are not the same as in your world.
Tax-exempt rates on secondary market munis are not privy to google searches. And high-risk, high-yield junk munis can also be packaged as tax-exempt at both the state and federal level. (I will let you figure out why it can be advantageous for the Feds to allow high-yield junk municipal bonds to skate by on taxes - it is not a direct skate, but the effect is the same, no taxes paid in the end) People would be shocked to know what Detroit and others have to cough up in terms of tax-free interest rates to support their spending habits. There are special clients who get rates way different than the public rate. Just like with banks, there are the clients and then there are the real clients.
Overall, the economics implied by the post are off. What do we have in place right now? The Fed Reserve is holding interest rates at zero and inflation is practically near zero as well. Therefore. in real dollars, given the correct mix of munis and another instruments, the buying power of the “less” money made at the current lower interest rate would be more in real terms than the buying power at the much higher inflation rate of 2003.
It is the real purchasing power that matters relative inflation and prices, not the net amount made. And how would Heinz take advantage? All she would do is increase her purchase of munis to make the same net amount or more, but live even better on the additional gift of the increased buying power because of practically non-existent errosionary inflation, as in years past.
However, working people, both liberals and conservatives, are currently paying much higher taxes now that the Bush tax cuts have been eliminated. The net effect of raising taxes is to wipe out any real purchasing power gains people would have gotten because of lower inflation. Yep, the current government ceremoniously goosed the working people and actually gave Heinz, Koch, Gates, Buffet etc. a huge gift for the last 8 years that is still compounding on itself, as they get to be tax-free and also take full advantage of the increased buying power.
Despite all this talk about raising rates, based on the current ideology of the Feds, do not be surprised to see bond rates decline even further, given the low inflation rates. This is because even at a lower rate, the yield would still better than at the higher interest rate and inflation spread of past years. Bottom line, Heinz could still be in munis and easily be making out like a bandit. She probably is, and my hat is off to her.
Busdriver11, I was talking about some individuals knowing stuff and some who don’t.
Not every answer is political.
For example, @doschicos, knows stuff. It’s obvious.
@awcntdb, very questionable. 
His answers are political. I started working in the financial markets in 1979. I have been told by three guys I didn’t understand risk. I think that is a pretty good record. Plus, it turns out I did understand risk.
Two of the guys got fired. 
A few years ago, I saw an advertisement. One of the guys who was fired was speakng at a convention. There were a bunch of financial speakers at the convention telling people how they could get rich. I think Donald Trump might have been there.
This speaker who was fired didn’t know what he was doing when he worked for us. He was supposed to be putting on risk free trades. Arbitrage.
I looked at the trades and saw he could lose millions of dollars. Our firm was not as big as JPMorgan. That would be a big hit for us. I called a friend who traded similar things and I asked him, “What am I missing here? If xyz occurs we are out millions”.
My friend, who was a partner in the firm said, “You are missing nothing. Get rid of this guy”.
It wasn’t easy getting rid of the guy. I was a consultant… Not the boss. I had two or three bosses. What an experience! Only time I worked for anybody after 1981 was a 5 year stint as a consultant. I feel sorry for those who work for people.
Anyway, I said the guy should be fired. The CEO didn’t want to fire the guy. Then the guy started losing. Hundreds of thousands and dollars. He was fired. I was slightly bummed out. The CEO owned a larger stake in the company than I did. Since the CEO didn’t fire him right away, I wanted to see how much this guy could lose.
You’ve got to be kidding right? The purchasing power of interest earned in the zero-interest environment of today is, by definition, zero.
Explain how your argument works in this real-life interest-earned example I just pulled from my muni-bond statements with the same balances:
2003: $15,000
2014: $600
Better yet, do not bother. You have no idea what world any of us lives in.
“And high-risk, high-yield junk munis can also be packaged as tax-exempt at both the state and federal level. (I will let you figure out why it can be advantageous for the Feds to allow high-yield junk municipal bonds to skate by on taxes” @awcntdb - You are not knowledgable about municipal securities. Municipal securities ARE federally tax-free - junk or investment grade - so your statement here is perplexing.
The only thing preventing any “mom and pop” investors from buying higher yielding municipal junk bonds are rules put in place to prevent unsophisticated investors from taking on risks they most likely do not understand. Institutions can buy them because, as “sophisticated investors”, it is assumed they have done their due diligence prior to investing. Some individual investors can buy them because they have adequate assets to have sufficient diversification, professional money managers who assist them in understanding and managing the risks, and they are usually required to sign a “big boy” or “sophisticated investor” letter.
However, you continue to miss the point that the very wealthy have other tools at their disposal more powerful for creating wealth than municipal securities. Many of these tools are geared towards creating wealth without creating any reportable income at all, whether that income is taxable or tax-exempt.
Well, based on the last several pages, we have answered the question. Tax laws, CPA’s and tax lawyers are to blame for America’s problems. 
Maybe I should stop there…
"Anyway, I said the guy should be fired. The CEO didn’t want to fire the guy. Then the guy started losing. Hundreds of thousands and dollars. He was fired. I was slightly bummed out. The CEO owned a larger stake in the company than I did. Since the CEO didn’t fire him right away, I wanted to see how much this guy could lose. "
Have you followed his career since? Who knows how much money he has lost for people. Apparently it’s all about the marketing, not the skills. Kind of like politicians.
As you can tell, I have a mantra or two.
That it’s been cold enough to freeze water? That’s a point that you wouldn’t think needed making but it’s as inconsequential to the validity of AGW theory as Noise’s horror of it.
He/she might, indeed. The time to remember their name, though, is before you submit your vote. After that, you might as well tune the bucket of warm spit out.
@busdriver11, I have not followed his career. I don’t think I would recognize his name anymore.
I can’t remember the president’s name. Oh…I can remember his first name. I can’t remember the cfo’s name.
I remember the CEO’s name. It’s been about three years since I left. I should probably check out the memory thread.
Some very useful information on that memory thread. Anything you can do to prevent dementia, you gotta do it. I have a whole host of brain issues in my family history. And that’s my excuse for everything! 
Wait, what was the topic?
“That it’s been cold enough to freeze water? That’s a point that you wouldn’t think needed making but it’s as inconsequential to the validity of AGW theory as Noise’s horror of it.”
Why do you think this Senator brought a snowball into the chamber?
“After that, you might as well tune the bucket of warm spit out.”
Maybe you can’t remember the name the VP after being elected, but I certainly can.
So anyway, have we ever defined or agreed upon what “America’s” problems are?
America’s problem is we can’t agree on anything, sadly.
I don’t recall saying anything derogatory about my - or your - memory skills. Of course, If you’d be so kind as to refresh my memory as to what post it was, I’d appreciate it.
Why would I care why the Senator brought a snowball to work? My opinion, whatever it was, wouldn’t detract from anything I’ve said. Niose was the one that found some sort of meaning, maybe validation, in it. I don’t.
I disagree.
I would say this another way - it is not that laws, per se, it is the people who are not smart enough to understand the laws.
In my view, one problem of America is too many people who vote have not a clue or understanding where the money in their pocket actually comes from and what determines its value. Their lives begins and ends with their paychecks. In turn, this ignorance makes good fiscal policy virtually impossible to implement when the politicians’ goal is to satisfy disparate groups, where each group believes false economic constructs which function at cross purposes.
Therefore, it is not the laws that are the problem; it is the stupid people for whom the laws are made for and the people who advocate for those laws.
If people understood the economics, they would reject many of the laws that politicians’ say are for their benefit. However, politicians know the people are stupid, so the people buy the stupid stuff politicians say to pander to them. If the people were smarter, they would not buy the nonsense.
You can change laws, but if the people are still clueless all that will replace the current law is another stupid law to pander to the same clueless people. Hence, the problem is the stupid people, not the laws.
That may be the most ludicrous thing I have ever read. Do you work for the BLS? Between hedonic adjustments and all manner of silliness the CPI index is the most laughable stat in the entire world. Using the formula that was in place in 1990 we have seen 4% inflation over the last year. If they used the same model as 1980 it would be nearly 10% for the last year.
A government with as massive a debt sheet as ours has every reason to cook the books when it comes to inflation (SS, Food Stamps, Gov’t and Military Pensions, etc). If the price of something goes up just discount it because people will lower their standards. Tuna goes up: well, they will switch to dog food. Clothing goes up: well, they will move to nudist colonies so they don’t have to buy clothes. Property taxes go up: people will move. The list goes on and on.
Anyone with even a modicum of common sense knows that other than some technology, everything is much more expensive than it was a year ago which is much more expensive than it was the year before that.
Gasoline is less expensive now than it was a year ago.