Passing the week. . .

Posted by Bruce Mc on Nov 16, 2008 in Opinions, Week in review | 3 comments

Some points I think need thought about:

Many economists believe and are expecting that the financial crisis, the worst in seven decades, will produce the country’s worst recession since the 1981-1982 downturn.

The retail sales report showed that sales at general merchandise stores, the category that includes big chains such as Wal-Mart Stores, and other department stores, fell 0.4%, while sales at specialty clothing stores were down a bigger 1.4%.

Sales at furniture stores dropped 2.5%, with sales at appliance stores and sport goods stores also showing declines.

One of the few areas to show an increase was the category that includes restaurants and bars, which posted a small 0.3% gain.

‘09 is going to be a very bad year for economic activity and is starting to dawn on people and they are starting to digest just how bad it’s going to be.

The Commerce Department reported that retail sales plunged by the largest amount on record in October as consumers cut back on spending in the wake of the financial crisis.

Retail sales fell 2.8% last month, surpassing the old mark of a 2.65% drop in November 2001 in the wake of the terrorist attacks that year.

For the week, the Dow lost 4.99%, the S&P fell 6.20% and the NASDAQ tumbled 7.92%.

The major indexes have fallen dramatically since their highs of October 2007 as the housing and credit crises have taken their toll on the economy. The Dow is down 40% from its closing record of 14,164.53, while the S&P 500 is off 44.2% from its record close of 1,565.15. The NASDAQ is off 46.9% from its then 7 1/12-year high of 2,859.12.

Wall Street’s violent swings in recent weeks are part of the market’s ongoing “bottoming” process, analysts say, in which the market retests the lows hit last month. The market is expected to remain volatile, as evidenced by past recoveries from a bear market.

            Kay Bell has some information in her post Treasury chief defends bank loss change. I know we should all be watching this scenario very close. Are you? Personally I am not very happy with how the bailout funds are being used. I still believe this thing passed when it shouldn’t have.

            A few other need to read post from Kay, Sunday reading: check cashers and recession talk, and Closer look at bank bailout tax breaks.

            Stimulus Package Is Not the Same as Stimulus Check is an informative post from Kelly the Taxgirl. If you are wondering about your next check . . . well I don’t, and neither should you.

            Ever want to take A Trip Through the IRS Audit, Appeals and Court Procedures? Well Rob Teuber from The Tax Law Forum in Milwaukee, Wisconsin. I like the flow chart he has there.

            From my favorite tax blogger we have a great post of IF I HAD MY DRUTHERS – PART II. Part one was for the tax code. Part two is a wish list I am willing to bet most preparers have.

            Also from Robert this week, HERE IS A SPECIAL TAX TRICK, WHAT HAPPENS IF YOU DO NOT FILE YOUR FEDERAL INCOME TAX RETURN, TO TWIT OR NOT TO TWIT.

Welcome to Twitter Robert, however I must say I am surprised to see you there giving your thoughts on social networking sites. If we are careful, could we talk you into also using a preparation software? Well maybe that is too much. Still, I for one am surprised to see you on Twitter.

Things should get better by 2010 or so says The Economist looking at the GDP. This post from Andy might give you a look at what is to come. I even gave my two cents worth in the comments of this post.

Andy also gives us his Reflections on the Week.

In a recently added blog to my blogroll (A Personal Finance Guide), we are given some pointers to help us Get Out of the Spending Habit to Help Your Finance.

Bluntmoney.com is Looking for more inspiring stories. Have you paid off your debt or otherwise improved your financial life? Are you in the process of doing so? If so, she would love to hear from you.

Patrick over at CashMoneyLife had a great week of post. If you missed them I recommend you go check them out.

Last week/end I enter to win a book and was truly excited to find out that I had won. The contest was held over at Living Almost Large. The book I won you can find out about at Book Review: Birth of Plenty. This week she reviewed Book Review: Investing for Dummies.

            I am very anxious to read Birth of Plenty.

            Are you living paycheck to paycheck? Robbing Peter to pay Paul when it comes to your bills? If you aren’t sure or you know you are then check out Let’s Dance! Who Knows the “Bill Shuffle”? from Kevin over at No Debt Plan.

            Other need to read post from Kevin – How to Financially Prepare for Children?, ING and Virtual Bank Reminders, How to Combat Your Internal Credit Card Debt Excuses, and one that doesn’t sound right but is 10 Great Reasons to Have Credit Card Debt.

            Put Your Brain Where Your Money Is: Think to Save is a great post from Penelope Pince over at Pecuniarities. The key is think. Like Penelope, I think 24/7 has to be unhealthy but once or twice a day, think about it. Is there a less expensive way. For the record I have been recently call a “cheep bastard” by the most loved one in my life. This hasn’t always been with me. In fact I used to often spend money just because “shopping makes you feel better”.

            Monday over at Wide Open Wallet she has a great post called Not being true to yourself can lead to financial disaster. A lesson learned by many the hard way. Including myself. A great quote from the article “if you live spending every dollar, eventually you need even more.”

            New to my blogroll is TaxDollarsAndSense introduced to me from another tax blogger and friend with his mention of Help Yourself by Filing Past Due Tax Returns. As I perused the site I had a great smiling moment when I read IRS Secret Agent. I am hoping to get my yard mowed.

Passing the Week. . .

Posted by Bruce Mc on Oct 5, 2008 in Week in review | 0 comments

            Damn shame to start the week off realizing the Market can’t hold its own. Kay Bell from Don’t Mess With Taxes, let us know that the Vote was against the bail out. With any luck they’ll do something more constructive. For the low down check out Kays entry Bailout Bombs. She has a lot of good links to see what happened.

            Finially a candidate with a good idea. I know, it sounded silly when I wrote it too. But Obama Proposes Raising FDIC Insurance Limit. A limit that hasn’t been raise since 1980. Meaning roughly that in terms of the era, and inflation, the insurance would need to be almost 250,000 to be worth as much as 100,000 was 28 years ago. Some good reading on this subject at the post above from Joseph Henchman at the Tax Policy Blog.

            Taxgirl takes a great look into what it cost to keep healthy in her post How Much Does it Cost to keep America Healthy? Plus Kelly is in the mist of changing her site around a bit. Looks good too. She told me she’s still working on it so it can only get better. Go check it out at TAXGIRL.

            Over at The Tax Lawyers Blog, we get a seemingly Irish look at taxes. Funny Tax Guy Song is a good laugh. As Peter points out “He can carry a tune and the lyrics aren’t bad.”

            There is an interesting Question posted and answered by THTP in his post Ask The Tax Pro – Child Care Benefits. Please for those of you not in know keep in mind, this is an important issue that isn’t always caught by tax payers who prepare their own tax returns. Another good reason to hire a pro.

            Trent from the simple dollar gives us a great look at the “extra paycheck” we get. In his post Personal Finance Management on a Biweekly Pay Schedule he discusses how it is looked at and how it should be looked at.

            Everybody is keeping an eye on the election somehow or in some way.  From a tax point of view we want our “leaders to be tax correct. Don’t we? After all they are going to be providing tax breaks for all of us, right? Covered the Tax Prof Blog we find a Vice Presidential candidate with a “questionable” return. Please take the time to read Gov. Palin Releases Opinion Letter Justifying Not Reporting Per Diem Expense Reimbursements as Income.

            Then we have a great catch from Peter over at The Tax Lawyers Blog in his post How can a Tax Credit be “Budget Neutral?” he discusses or points out an issue from the debate.

            Russ Fox of Taxable Talk does a great job reporting on tax cheats who get caught. In his post “They Should Have Known Better” tales of several tax cheaters who should have known better.

            At the end of tax season in the year 2007 (preparing 2006 returns), I was diagnosed with asthma. As time went on it grow into quite a situation for me. I had been a smoker for a very long time (somewhere in high school when I first started) and this was frustrating. However in that time I have learned a great deal. One of the biggest problems was finding things to use that weren’t aerosol. Cleaners and air fresheners mostly. Cleaners are still a learning thing, but I think I have a handle on Air fresheners thanks to Madoline over at Our Fourpence Worth with her post Healthy Alternatives for Aerosol Air Fresheners. Thank you very much Madoline.

            Some good points are made by Any over at $aving to Invest in his post Tax-Exempt Money Market Funds are Rocking. To find out why, read this post. Also be sure to read his links as the information (both his and from the www) is very good.  He is about to inspire me to post about such things, maybe. We’ll see how next month goes.

In a great Post by Gerald Prante over at the Tax Foundation Blog, a great question is asked and answered. Is Any Ol’ Tax Cut a Good Tax Cut? No. In it you’ll find some real interesting information and thought.

            The “economic crisis” hits home for Wide Open Wallet. For her and her family, things are about to change.

            Okay, the economy is in the toilet. Most of the blogs I read are giving the “Bailout” all the press time. Blunt Money goes past what the ones in charge are doing and advises us all on How to prepare for a Layoff. We all know the economic situation sucks, it’s nice to see that some of us can look past the fools on the hill, and focus a bit on getting by as an individuals.

Focus is key, and we all need to focus on how we are going to get through the economic spiral. Am I for or against the bailout? You know, If I make a bad decision, and loan money to a questionable source. My mistake, and I’m not going to look for anyone to help me out. We seem to live in a society where credit is key. So why is there such a global push for us to get rid of it (i.e. get out of debt). The corporations that are failing are the same ones who have lobbied for tax cuts that afford them to take losses from previous years to offset gains this year. These same companies (not all) are claiming record profits. (like oil) It tends to make one wonder (or should) how. I heard from one client who works for a worldwide retail corporation, that in one week corporate changed/increased the price of an item three times. That item increased in price by $23.00 in a week. He also told me that he gets a list almost daily of price increases. We pay more, they make more. Maybe we should try and stop the madness. Not give it an injection of steroids that will wear out to soon.

A quote from an editor of a magazine I read regularly:

“The Fed and the Treasury Department have made it clear that they will spend and guarantee whatever it takes to prevent a collapse of the financial system. As a taxpayer you should be appalled. – As an investor, be relieved.”

And thus the bailout plan passed. Talked about at almost every blog in my blogroll. There are some good things to come out of this, but the “bailout”, the three pages that got turned down Tuesday, is still the same. Now over 400 pages later with tax extensions and other such being added (and has nothing to do with the Bailout) it passed. Then signed the same day by our President. Hold on everyone, the ride is about to get bumpy.

Tomorrow my series continues, I’ll be up on Monday, Wednessday a guest post from Blunt Money, and Friday a guest post from IRS-Hitman.

I also have a guest post on Monday at TWTP. He will be locked in a room next week and not wondering the blog-o-sphere this coming week. Look for the links to his guest post as they appear. Did I mention mine was going to be up on Monday? It is titled BEST OF THE BEST – BRUCE MCFARLAND. Several of us are giving out our best advice in the tax world. Try not to miss the series. (it last all week)

For future reference, do the math first!

Posted by Bruce Mc on Sep 27, 2008 in Opinions | 1 comment

Earlier in the week, I sent out an e-mail that was sent to me. Kind of a chain sort of thing, yet somebody was “trying“to use their head. However their math was off. A lot. I encouraged those I sent it out to, to ”do the math.” Not everyone responded. Of those who did only one actually mathed it out. (I didn’t hear from him untill last night). Other responses were as I knew and feared, they wanted their share, screw AIG. This letter has caused some angry protest to congressmen as well. Why?

Check it out below.

“Now here is the idea of how to save the economy ………

I’m against the $85,000,000,000.00 bailout of AIG.

Instead, I’m in favor of giving $85,000,000,000 to America in a ‘We Deserve It Dividend’.
To make the math simple, let’s assume there are 200,000,000 bonafide U.S. Citizens 18+.
Our population is about 301,000,000 +/- counting every man, woman and child. So 200,000,000 might be a fair stab at adults 18 and up.

So divide 200 million adults 18+ into $85 billon that equals $425,000.00.

My plan is to give $425,000 to every person 18+ as a ‘We Deserve It Dividend’.

Of course, it would NOT be tax free. So let’s assume a tax rate of 30%.

Every individual 18+ has to pay $127,500.00 in taxes. That sends $25,500,000,000 right back to Uncle Sam.

But it means that every adult 18+ has $297,500.00 in their pocket. A husband and wife has $595,000.00.

What would you do with $297,500.00 to $595,000.00 in your family?

Pay off your mortgage, housing crisis solved.

Repay college loans, what a great boost to new grads Put away money for college, it’ll be there
Save in a bank, create money to loan to entrepreneurs.

Buy a new car, create jobs Invest in the market , capital drives growth

Pay for your parent’s medical insurance, health care improves

Enable Deadbeat Dads to come clean, or else

Remember this is for every adult U S Citizen 18+  including the folks who lost their jobs at Lehman Brothers and every other company that is cutting back. And of course, for those serving in our Armed Forces.

If we’re going to re-distribute wealth let’s really do it…instead of trickling out a puny $1000.00 (vote buy) economic incentive that is being proposed by one of our candidates for President.

If we’re going to do an $85 billion bailout, let’s bail out every adult U S Citizen 18+!

As for AIG liquidate it. Sell off its parts. Let American General go back to being American General. Sell off the real estate. Let the private sector bargain hunters cut it up and clean it up.

Here’s my rationale. We deserve it and AIG doesn’t.

Sure it’s a crazy idea that can never work. Maybe???

But can you imagine the Coast-To-Coast Block Party!

How do you spell Economic Boom?

I trust my fellow adult Americans to know how to use the $85 Billion ’We Deserve It Dividend’ more than I do the geniuses at AIG or in Washington DC.

And remember, The Birk plan only really costs $59.5 Billion because $25.5 Billion is returned instantly in taxes to Uncle Sam.”

Using this author’s numbers of 200,000,000 people and 85 Billion, actually we all would only get $425.00.

Why am I putting this out?

I know that this has gone out to a great number of people who sent it on to others. I know people will/have blindly read this and believe the math in it and will or already have written letters to their congressmen who have much better things to do with their staff then read letters from pissed off tax payers who can’t multiply or divide.

I know one congressman who is actually having fun with this and trying to see how many people actually write in about it. (my and your tax dollars hard at work), So far over a hundred letters received.  And that is just one.

For future reference I ask that when you get e-mails like the one above: Make sure you actually do the math before you react.

Also for the record, in my opinion, the American taxpayer got their share earlier this year, and not everyone took advantage of it.