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Thread: CBO: Stimulus hurts economy in the long run

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    Re: CBO: Stimulus hurts economy in the long run

    Quote Originally Posted by j-mac View Post
    But, in simple terms, what happens to small business, and even larger business when their bottom line profit shrinks?
    Profit tends to shrink primarily from two reasons. Either company sales (demand) are slumping, or their input costs (supply) are growing faster than their sales. Considering our actual situation, what do you think is the largest risk to shrink profits for small businesses?
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

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    Re: CBO: Stimulus hurts economy in the long run

    Quote Originally Posted by Goldenboy219 View Post
    Profit tends to shrink primarily from two reasons. Either company sales (demand) are slumping, or their input costs (supply) are growing faster than their sales. Considering our actual situation, what do you think is the largest risk to shrink profits for small businesses?
    Well, if you work in plastic, both. Until very recently, oil prices have been high, raising the input costs. The economy has been depressed and people are putting off projects, reducing demand. So supply cost is up and demand is down.
    We went from sticks and stones may break my bones but words will never hurt me to safe spaces.

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    Re: CBO: Stimulus hurts economy in the long run

    Quote Originally Posted by Goldenboy219 View Post
    Profit tends to shrink primarily from two reasons. Either company sales (demand) are slumping, or their input costs (supply) are growing faster than their sales.
    Are you saying that taxation costs are not part of the bottom line considerations to running a business? Things like Training, Health Care, Pension (if offered), Worker compensation Ins.? All these things are considerations separate from Sales, or Supply are they not?

    Considering our actual situation, what do you think is the largest risk to shrink profits for small businesses?
    I drive a semi for a medium to large carrier that hauls for Kroger, and am pretty good friends with the terminal manager, as well as a few of the VP's of my company, and have talked with them at times with what their concerns are when it comes to taking on added employment, and the strength and stability of business today as it relates to the economy. The answers I get most often since we carry groceries that in any economy is a fairly stable good to be transporting, the climate to hire is actually more risky today than other times, largely because the current administration is not offering anything certain for business to plan out with. Using a strategy of slapping down, and demonizing business one day as greedy, and "protected", then the next portraying that the administration is buddy, buddy with them and backs them is schizophrenic to say the least, and lends to business holding fast to see what is going to happen rather than investing.

    This idea that business has some moral responsibility to help this administration by hiring in such a divisive, uncertain economy merely for the reason to make this administration look like it is succeeding, when it is clear that it want's nothing more than to control, and limit the amount that any particular business can make and take the overage of that number for the purpose of redistribution, coupled with crony capitalism that they have displayed clearly is a major hindrance to this economy recovering, and will continue to be such, if not more destructive should Obama somehow beat the odds and retain the Presidency.


    j-mac
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    Re: CBO: Stimulus hurts economy in the long run

    Quote Originally Posted by Blue_State View Post
    Well, if you work in plastic, both. Until very recently, oil prices have been high, raising the input costs. The economy has been depressed and people are putting off projects, reducing demand. So supply cost is up and demand is down.
    Our current economic downturn is not a result of short term commodity volatility.
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

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    Re: CBO: Stimulus hurts economy in the long run

    Quote Originally Posted by j-mac View Post
    Are you saying that taxation costs are not part of the bottom line considerations to running a business? Things like Training, Health Care, Pension (if offered), Worker compensation Ins.? All these things are considerations separate from Sales, or Supply are they not?
    Of course they are. But can you show me that these various costs are increasing to the point where input costs (overall) are outpacing sales? If not, then you are essentially blowing hot air.
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

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    Re: CBO: Stimulus hurts economy in the long run

    Quote Originally Posted by Goldenboy219 View Post
    Of course they are. But can you show me that these various costs are increasing to the point where input costs (overall) are outpacing sales? If not, then you are essentially blowing hot air.
    The one issue that far too many do not understand is that for every dollar of expense the profits of the company drop by a dollar and every dollar of revenue increase affects the bottomline by the GP margin on that item sold normally in the range of 30% but varying by business. Tax increases affect the bottomline by a dollar and hurts business more than sales growth.

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    Re: CBO: Stimulus hurts economy in the long run

    Quote Originally Posted by Conservative View Post
    The one issue that far too many do not understand is that for every dollar of expense the profits of the company drop by a dollar and every dollar of revenue increase affects the bottomline by the GP margin on that item sold normally in the range of 30% but varying by business. Tax increases affect the bottomline by a dollar and hurts business more than sales growth.
    Wake up!

    Also, i was unaware that sales growth hurts a business.
    Last edited by Kushinator; 12-02-11 at 11:47 AM.
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

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    Re: CBO: Stimulus hurts economy in the long run

    Quote Originally Posted by Goldenboy219 View Post
    Wake up!
    Price to earnings ratio? Never ran a business did you? My statement is accurate and based upon actual P&L's. Ever look at one? Expenses a dollar hit to profit and revenue is a percentage less than 100% to profit. That is the way it works, sorry.

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    Re: CBO: Stimulus hurts economy in the long run

    Quote Originally Posted by finebead View Post
    It was a global phenomenon, in the US and around the world. If you don't know this, or refuse to acknowledge the obvious, they will be little for us to discuss. I provide my documentation just below, from a neutral site in Europe, one that offers investment advice, not one that is politicized. So, where is your support for your position?
    Yes, what was done was a huge positive for those who provide investment advice.

    Translation = I have no plan, I will ask someone else to fix this. Actually FDR got numerous programs enacted to spend money to public works programs, to get people back to work, to put money in their pockets, so they could consume and get the rest of the economy pumping, programs like the WPA and the CCC. He also enacted financial reform with the SEC and Glass-Steagal.
    I'm going to guess you've never read what he did.

    Understanding FDR’s Bank Holiday Move in 1933 Mostly Economics

    Now just because one can pick something they agreed with someone one does not mean they agree with everything they did. Yes, in FDR's case it was a little different. It was depositors causing the problem. Depositors had no reason to this time as the vast majority were protected by FDIC insurance. It was the markets that were the problem. I would have done the same thing. Would it be more complicated than in 1933? Sure, but despite claims of being "surprised" those running things had to know that things were about to collapse and had plenty of time to come up with a plan that didn't involve taking from those who had nothing to do with the problem.

    Greenspan the lifelong republican, appointed by repub president Bush in 2002. The legacy of republican failures from 2001-2006 when they controlled the house, senate, white house and federal reserve is why I DON'T want to vote for those fools today.
    You only show that you are as I noted before, a partisan hack with statements like this.

    What about Chris Cox role at SEC in 2004, where he allowed the biggest banks to radically increase their leverage by relaxing the Net Capital Rule, which is what allowed them to buy all the junk mortgages up in 2004-2006, which directly lead to the crisis?

    What about Bill Frist (R-Tenn), senate majority leader who would not bring S-190 by Chuck Hagel to the senate floor in 2005 for a vote, a bill to reign in Fannie and Freddie? The house of rep. had already passed the companion bill, H-1464 if memory serves, by a wide majority from both parties, the vote was 330 to 90 in favor IIRC.
    I can find all sorts of individual cases to show blame from BOTH parties. There are all sorts of video's out there with folks like Barney Frank claiming that F&F were in fine financial shape and that no further actions needed taken just before they collapsed. Bernanke was appointed by Bush and I have no problem blaming BOTH of them but even after we knew that Bernanke failed miserably in his job Obama re-appointed him.

    There is little to gain in discussing something like this who only wants to blame one party.

    It is just semantics at best, or plain wrong at worst. See below:
    You can call it spending all day and it matters none. They only redistribute money.

    Translation = I have no plan.
    I told you were I would have started. The second thing I would have done is enforce Sarbanes/Oxley.

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    Re: CBO: Stimulus hurts economy in the long run

    Quote Originally Posted by Goldenboy219 View Post
    Of course they are. But can you show me that these various costs are increasing to the point where input costs (overall) are outpacing sales? If not, then you are essentially blowing hot air.
    Let's not be so quick to dismiss if I don't agree with everything you are proposing here. Like I said, I am no economist, so I look to what is being said, as well as informed opinions on what is taking place, as well as common sense.

    I offer an opinion from:

    Gary Stanley Becker (born December 2, 1930) is an American economist. He is a professor of economics, sociology at the University of Chicago and a professor at the Booth School of Business. He was awarded the Nobel Memorial Prize in Economic Sciences in 1992, and received the United States' Presidential Medal of Freedom in 2007.[1

    Gary Becker - Wikipedia, the free encyclopedia
    and:

    Richard Allen Posner (born January 11, 1939) is an American jurist, legal theorist, and economist who is currently a judge on the United States Court of Appeals for the Seventh Circuit in Chicago and a Senior Lecturer at the University of Chicago Law School. He is an influential figure in the law and economics school of thought.

    Richard Posner - Wikipedia, the free encyclopedia
    In addition to repeated attacks on American business, especially banks (some of the attacks on banks were well deserved), Congress passed an expensive stimulus package that did not stimulate much. The health care bill Congress passed seems likely to increase the cost to small and large businesses of providing health insurance for employees. Congressional leaders proposed high taxes on carbon emissions, large increases in taxes on higher income individuals, corporate profits, and capital gains as part of vocal attacks on “billionaires”. Many in Congress wanted to cap, or at least control, compensation of executives. Proposals were advanced to make anti-trust laws less pro-consumer, and more protective of competitors from aggressive and innovative companies. Congress passed and the president signed a financial reform bill that is a complicated and a politically driven mixture of sensible reforms, and senseless changes that have little to do with stabilizing the financial architecture, or correcting what was defective in prior regulations.

    It is no surprise that this rhetoric and the proposed and actual policies discouraged business investment and slowed down the recovery. Yet, I had expected the recovery to speed up after radical approaches to the American economy were repudiated in the 2010 Congressional elections, when many of the more liberal members of Congress lost their seats. For a while the economy did began to pick up, as unemployment declined quite rapidly from hovering around 10% to about 9% at end of 2010, and GDP started growing faster. But then the economy stalled. The challenge is to explain the drift in the unemployment rate during the past several months, and the rather tepid growth in GDP that have raised fears of a “double-dip”.

    http://www.becker-posner-blog.com/20...ry-becker.html
    All of these things have a negative effect on our economy, and are solely the province of Obama, and administration tampering in business that have made this economy what it is today.

    j-mac
    Americans are so enamored of equality that they would rather be equal in slavery than unequal in freedom.

    Alexis de Tocqueville

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