Where is the US economy headed?

Weekly Averages:

* Average consumer credit card rate, overall market: 14.03%
* Average credit card rate, non-reward consumer cards: 12.65%
* Average reward credit card rate: 14.62%
* Average student credit card rate: 14.61%
* Average business credit card rate (non-reward): 10.83%
* Average business reward credit card rate: 11.69%

Many businesses are losing money in this economy which is why they are laying people off and doing other measures to try to return to profitability.

A tax cut doesn't help a business that is losing money. It won't affect them until they are making a profit.

....

Thankfully we just passed a bill that will create 3.5 million jobs.

$789 billion to create or save 3.5 million jobs = $225,428 / job.

Very efficient.

parados wrote:

Many businesses are losing money in this economy which is why they are laying people off and doing other measures to try to return to profitability.

A tax cut doesn't help a business that is losing money. It won't affect them until they are making a profit.

....

I don't know where to start, there is so much lack of common sense here. Whether a business is making money or not, a tax cut for businesses affects all businesses, because the entire business world is connected. Just one example, if a business buys supplies or materials, or services from another business, which of course permeates the entire business world, the price of those materials, services, and materials are affected by taxes on those businesses, on on down the line. There is a multiplier effect throughout the system.

It's not tax cuts that'll save any business

Hold on. You're in a downward cycle. People are getting laid off. Companies are not selling their products, and making a deficit. Mostly because people are not keen on spending money while they are afraid that things might get worse, while they have to fear for their jobs. People hold on to their money, which in turn results in businesses being even less able to sell goods, which, in turn, results in more people losing their jobs.

Now, unless I'm completely mistaken, part of what you'd want to do is encourage people to spend money rather than hoard it, right?

okie wrote:

I would eliminate income tax completely, go to a national sales tax, and this would make the market a level playing field in this country.

Make it even more attractive to save money rather than to spend it? Seriously?

okie wrote:

parados wrote:

Many businesses are losing money in this economy which is why they are laying people off and doing other measures to try to return to profitability.

A tax cut doesn't help a business that is losing money. It won't affect them until they are making a profit.

....

I don't know where to start, there is so much lack of common sense here. Whether a business is making money or not, a tax cut for businesses affects all businesses, because the entire business world is connected. Just one example, if a business buys supplies or materials, or services from another business, which of course permeates the entire business world, the price of those materials, services, and materials are affected by taxes on those businesses, on on down the line. There is a multiplier effect throughout the system.

maybe the price is affected down the line. You assume that businesses automatically lower prices when their prices are lowered. They do not.

Cycloptichorn

Cycloptichorn wrote:

okie wrote:

parados wrote:

Many businesses are losing money in this economy which is why they are laying people off and doing other measures to try to return to profitability.

A tax cut doesn't help a business that is losing money. It won't affect them until they are making a profit.

....

I don't know where to start, there is so much lack of common sense here. Whether a business is making money or not, a tax cut for businesses affects all businesses, because the entire business world is connected. Just one example, if a business buys supplies or materials, or services from another business, which of course permeates the entire business world, the price of those materials, services, and materials are affected by taxes on those businesses, on on down the line. There is a multiplier effect throughout the system.

maybe the price is affected down the line. You assume that businesses automatically lower prices when their prices are lowered. They do not.

Cycloptichorn

With competition, prices do come down. Learn it, love it, cyclops, it happens. It sometimes takes a while, but it does. If you ever ran a business, you would know this. And lower prices stimulate sales. Sam Walton proved this, oh did he prove it.

okie, It's not tax cuts that'll save any business; that's why it's called a business; they must have demand (people with money). Without demand, they go broke with or without tax cuts.

I continually am surprised at the outright ignorance of simple economic concepts here on this forum, price, demand, supply, and how they all link. Human nature plays into it. People buy the best and cheapest, they balance quality and price, and they do not spend money on more expensive unless they are convinced it is enough better, if given a choice. Or perhaps just lack of faith in the concepts, but ample evidence abounds everyday in everybody's world if they would just open their eyes.

The free market works, central planning does not. Now if anyone wants to challenge that, fine, but provide evidence that is credible.

So, how long does that take? Months? Years? You have no idea. This is where the idea that business tax cuts have any sort of near-term stimulus effect has very little actual data to back it up.

Lower prices don't stimulate sales in the middle of a recession if people don't have jobs to buy non-essential goods.

This is where your ideology sort of breaks down. You are making assumptions about the market which don't exist. What about businesses for whom there is no real competition in their area, or who are locked in to long-term, fixed contracts with other businesses? Tax cuts just put more money in their owner's pockets.

Cycloptichorn

Cycloptichorn wrote:

So, how long does that take? Months? Years? You have no idea. This is where the idea that business tax cuts have any sort of near-term stimulus effect has very little actual data to back it up.

Lower prices don't stimulate sales in the middle of a recession if people don't have jobs to buy non-essential goods.

This is where your ideology sort of breaks down. You are making assumptions about the market which don't exist. What about businesses for whom there is no real competition in their area, or who are locked in to long-term, fixed contracts with other businesses? Tax cuts just put more money in their owner's pockets.

Cycloptichorn

So do you believe in central planning, communism, cyclops? Say it, you believe businesses are all evil and greedy. Are you claiming taxes do not help businesses, if reduced or eliminated? Good grief, I give up on this forum!