9.8%

• ptown_trojans_1

  

  believer;586541 wrote:You mean like the "shovel-ready" infrastructure improvements that Obama claimed would keep unemployment from rising above 8% when he, Pelosi, and Reid ramrodded his bogus $875 BILLION Porkulus Sammich through the Dem-controlled Congress a couple of years ago?
  
  That worked out nicely.

  
  Yeah, those were awful examples, as they were ones that were either delayed or cut from funding.
  What we need is new infrastructure, newer roads, wider roads, more, faster railways, (newer subways in DCs case), newer water systems, newer sewer systems, newer bridges, newer urban centers. We also need newer/ faster technology speed, internet connectivity, better cell phone reception, more areas tech friendly, etc.
  
  That is where we are falling behind China and Europe.
• gut

  BoatShoes;586505 wrote:This is an idea I agree with. It seems to me that a low capital gains rate and low qualified dividend rates relative to a high corporate tax rate encourages divestment rather than investment. People could keep their earnings and profits within their corporate shell in order to have a lower tax burden. That money in turn can be used for productive activity rather than divested and transferred to an emerging market for example. Evil Socialist countries like Germany, the world's largest exporter, despite having high individual rates have lower corporate rates relative to them.

  
  All on point. When the capital gains rate was lowered we did observe an increase in dividends, particularly at closely-held companies or even just with large individual shareholders. It's a complicated discussion I'd guess the academic literature disagrees on. On the one hand, the argument for reducing capital gains is it encourages investment, and companies returning excess cash to shareholders is more productive because it expands the opportunity set of investment for that cash. On the other hand, as you note, it can lead to suboptimal investment decisions for the corporation. Efficient markets folks are going to argue its generally better to return excess cash to the shareholders (reduces incentive for empire building). But if you're not an EM guy you might argue economies of scale and information assymetries enable the corporation to make more productive investment decisions, to a point. Of course, EM also favors dividend irrelevance theory and that person can get the same amount of cash by selling an equivalent portion of their shares.
• believer

  

  ptown_trojans_1;586554 wrote:Yeah, those were awful examples, as they were ones that were either delayed or cut from funding.
  What we need is new infrastructure, newer roads, wider roads, more, faster railways, (newer subways in DCs case), newer water systems, newer sewer systems, newer bridges, newer urban centers. We also need newer/ faster technology speed, internet connectivity, better cell phone reception, more areas tech friendly, etc.
  
  That is where we are falling behind China and Europe.

  
  Oh, I'm not opposed to infrastructure improvements and will be the first conservative on OC to agree that this nation needs an infrastructure enema.
  
  My point was BHO & Co. sold us a bogus bill of goods on the Porkulus Spending by telling us that a huge chunk of the money would go towards infrastructure upgrades and that in doing so, many people would be kept out of the unemployment lines.
  
  Before I'll buy-off on talk of more porkulus spending on alleged infrastructure improvements, I'd like some re-assurance that the money will, indeed, be used for that purpose.
• ptown_trojans_1

  

  believer;586571 wrote:Oh, I'm not opposed to infrastructure improvements and will be the first conservative on OC to agree that this nation needs an infrastructure enema.
  
  My point was BHO & Co. sold us a bogus bill of goods on the Porkulus Spending by telling us that a huge chunk of the money would go towards infrastructure upgrades and that in doing so, many people would be kept out of the unemployment lines.
  
  Before I'll buy-off on talk of more porkulus spending on alleged infrastructure improvements, I'd like some re-assurance that the money will, indeed, be used for that purpose.

  
  Agreed. They did not put the proper context into the bill or the projects. Big fail by the media too.
• gut

  believer;586571 wrote:
  Before I'll buy-off on talk of more porkulus spending on alleged infrastructure improvements, I'd like some re-assurance that the money will, indeed, be used for that purpose.

  
  And too much emphasis on "green" projects. Some of the "green" projects that got approved were a complete joke. Just more examples of overspending on somewhat of a dubious issue with dubious benefits. Hey! Let's tear out old streetlights and replace them with solar lamps!!!! It will only cost us $50M but in 30--40 years we'll have recovered the cost of our investment!!! Better yet, let's spend $50M on a feasibility study for a bullet train and then we can end-up with nothing to show for our money at all!!! Hell, why not do both!!!
• ptown_trojans_1

  

  gut;586639 wrote:And too much emphasis on "green" projects. Some of the "green" projects that got approved were a complete joke. Just more examples of overspending on somewhat of a dubious issue with dubious benefits. Hey! Let's tear out old streetlights and replace them with solar lamps!!!! It will only cost us $50M but in 30--40 years we'll have recovered the cost of our investment!!! Better yet, let's spend $50M on a feasibility study for a bullet train and then we can end-up with nothing to show for our money at all!!! Hell, why not do both!!!

  
  Those are fine as in the long term, yes they do save money. Also, the bullet trains are a great idea as in the east coast or west coast it could really help traffic and reduce air costs as less people will drive or fly. But, those trains need to be 100+ MPH fast, like China or Japan.
• gut

  ptown_trojans_1;586668 wrote:Those are fine as in the long term, yes they do save money. Also, the bullet trains are a great idea as in the east coast or west coast it could really help traffic and reduce air costs as less people will drive or fly. But, those trains need to be 100+ MPH fast, like China or Japan.

  
  But there's also the issue of opportunity cost and ROI, not that "break-evens" are an asbolute or can't be manipulated. Generating money in the long-run doesn't mean that the investment offers an acceptable return - my hurdle rate is something north of 0 and that's what I was attempting to illustrate with those examples. Don't get me started on bullet trains - the US doesn't have the density for the economics to work.
• ptown_trojans_1

  

  gut;586685 wrote:But there's also the issue of opportunity cost and ROI, not that "break-evens" are an asbolute or can't be manipulated. Generating money in the long-run doesn't mean that the investment offers an acceptable return - my hurdle rate is something north of 0 and that's what I was attempting to illustrate with those examples. Don't get me started on bullet trains - the US doesn't have the density for the economics to work.

  
  I see it a little differently as once the technology is introduced in the market, naturally innovation follows and it leads to cheaper units, which leads to more savings. It is the basic new technology model. It is high cost unit that goes down over time.
  
  Bullet trains can work between Boston and Atlanta and between San Fran and San Diego. Anywhere else is a stretch right now. But, if I could get to New York from DC in under 2 hours without going to the airport, being on a cramped on bus for hours or all the toll roads on a train, I would do it in a heart beat.
  
  I know many folks that live in New York, but come to DC several times a week on the regular train. With bullet trains, the demand would increase and it would dramatically decrease road and air traffic.
  
  But, for people in Ohio, unless it is a train that gets you from Cleveland to Columbus in under an hour, it will not fly.
• revgat

  believer;586541 wrote:You mean like the "shovel-ready" infrastructure improvements that Obama claimed would keep unemployment from rising above 8% when he, Pelosi, and Reid ramrodded his bogus $875 BILLION Porkulus Sammich through the Dem-controlled Congress a couple of years ago?
  
  That worked out nicely.

  
  No, I mean the projects that America needs to stay where they are socially. I think many would benefit from an improved water system. I am not even saying it is shovel ready, but it is something that could be improved.
• I Wear Pants

  We do need new infrastructure and that includes things like high speed. And real high speed, not the ADSL shit. We're falling behind in that regard and it isn't because of the size of the country.
• Ty Webb

  

  Great Thread guys....fun read
• BGFalcons82

  

  Welcome back, Ty.