-- Posted Wednesday, 2 January 2013 | | Disqus
Higher taxes for millionaires? First ask yourself "How did they become millionaires?" Then ask yourself "If I'm so smart, how come I'm not a millionaire, too?"
Well, if this helps, I have noticed that one of the differences between us slovenly proletariat trash and millionaires is that they seem to have a lot of perfect teeth and nice haircuts. So, if you have nice teeth and hair, the data apparently shows that you've got it made, so relax! Haha!
If you don't have these, however, you will need to do it the appropriately-named "hard way", which brings up one Big Important Difference (BID) between us busted-out lowlife dimwits and the millionaires: We spent our money on pure gluttonous consumption, and had a wonderful time for a surprising number of years by virtue of racking up suffocating amounts of debt, whereas millionaires got their millions from profitably (as in compounding the money borrowed from a bank) investing their money in productive, profitable businesses, like making money by making things, or by mining things, or making money merely handling whole oceans of money, or making money by running this towering, engulfing deluge of money created by the evil Federal Reserve through some Wall Street scam, con job, bamboozle or 401(k), or in any of the rest of the gigantic financial services industry which produces, as best I can remember instead of researching it to find out, about 40% of all the profits made in America.
You no doubt noticed that I surprisingly did not use an exclamation point to emphasize such a huge, glaring fact that is destroying this country with some silly, low-IQ, pie-in-the-sky crap about how investing all your retirement money in the stock market is such a good idea when in fact -- in fact! -- it is a mathematically a guaranteed -- guaranteed! -- loser for the vast majority of trusting, gullible and embarrassingly ignorant people who are stupid enough to think that putting all their money, and their entire financial future, into the general stock market is a "good idea" despite a complete lack of successful historical examples, common sense and the mountains of evidence to the contrary, when, alas, it isn't, as the evidence had already proved, so it's weird anyone would do it.
Anyway, I remember when I found out that investing long-term in stocks is a Big Time Loser (BTL) for the vast majority of people, and a Small Time Loser (STL) for almost everybody else.
For me, it was the Five Stages of Shock. First, I was in denial, then, in the Second Stage, I was angry, then I was depressed, then I was angry again, then more angry, and then violently angry and scared out my Mogambo Freaking Mind (MFM), where I remain today.
And it's especially bad when dividends from owning stocks are taxed so highly. We're the highest taxers of dividends in the world!
Forbes magazine posted a blog by Austin Johnson on the new changes in taxes on dividends. The top corporate rate on the dividend is now 39.6%. The recipient of a dividend, if in the top tax bracket, is taxed at 39.6%, too, plus another 3.8% (the new Medicare tax), for a whopping combined tax rate of 65.8l%!
And if you just stupidly add up the tax rates, it comes to an 83% tax! This 83% tax rate is both highly shocking and, unfortunately, a ridiculous and useless concept, except as evidence that I have no idea what I am talking about, as if anyone needed more evidence of that! Hahaha! Come on!
But what else can people do, except buy stocks, with all the trillions and trillions of new dollars being first created by the evil Federal Reserve and then spent by the government? All these tons and tons of new dollars, busily working their economic way down winding, wending paths through an economy's worth of manufacturers, miners and farmers, workers, middlemen, retailers, owners and shareholders, and government itself, all of whom always have to wonder "What to do with all this money rolling in, and how can I get some more of it?"
And what other market can absorb literally trillions and trillions of dollars per year?
Ergo, the stock market has to go up because the government is not going to stop deficit-spending, and thus the Federal Reserve will not stop creating lots and lots of money, and there is nothing else to do with that much freaking money, except maybe buy bonds, which are, alas, Totally, Totally Toxic (TTT).
Get a load of this: With the price of bonds so high, the imputed yield on the 10-year bond is at a tiny, micro, miniscule 1.5%, when even the government's own ludicrously-doctored figures show that inflation in prices is over 2%, and the money supply is expanding by over 10% a year!
It's actually over 8% price inflation, as I gather from John Williams at shadowstats.com, who calculates inflation the old-fashioned way: It measures how much prices went up, more nearly matches the increase in the money supply.
So join with me in asking what kind of morons are buying bonds, thus losing real buying power in inflation-adjusted dollars, when history shows the average yield is about 6%, which means that when the interest rate gets back to its long-term average (if it ever does! Ha!), then the expensive 10-year bond you bought today, yielding a laughably low 1.5%, will have lost 75% of its cost? Yikes! Big loss!
And this does not even MENTION the reduced spending-power value of the remaining 25% of your dollars, thanks to inflation. All in all, bondholders will pretty much be wiped out! Yikes! Nice long-term investing there, dude! Hahahaha!
At this point, you may be asking yourself "What kind of an insulting idiot is this Stupid Mogambo Person (SMP) disrespecting the insurance and retirement investment industries who have to buy bonds because they have no choice, and who are getting screwed along with everybody else, except for the executives, of course, who are all, I am sure, making out like bandits? I hate him!"
Or perhaps you are even rubbing your chin, thoughtfully saying "I hate him, too, just like the guy in the paragraph above, but what he says makes sense! But I hate him nonetheless after listening to him blabbering and blubbering, rambling incoherently in that loud, stupid voice of his about how We're Freaking Doomed (WFD) because of the inflation in prices that will be caused by the inflation in the money supply because the evil Federal Reserve is forced to create more and more and more money and credit so that the federal government can continually deficit-spend us into a twisted, inflationary hell without the government having to embarrassingly try to auction off such astonishing, astounding, completely unbelievably massive loads of new government debt by actually competing in the credit markets, bidding against other sellers of new debt for a relatively limited pool of private funds, pushing interest rates To The Freaking Moon (TTFM), destroying America and the world. I mean, what kind of idiot IS this guy?"
What kind of idiot am I, you ask? Well, I'll TELL you what kind of idiot I am! I am the kind of idiot that that is so stupid that he fails at everything, and the only things at which I did NOT fail are, firstly, to finally recognize and accept my own inherent stupidity, and secondly to wisely acknowledge the correctness of my naturally-suspicious paranoia and cynical hostility towards governments, self-interested salesmen and self-proclaimed "experts."
Thus, I looked, instead, at history to find out what happened all the other times over the last 4,500 years when a government acted this stupidly (most of them, as it turns out), and to find the ultimate best investment that lasted through it all.
As an aside, I could have saved a LOT of time, learned the same thing about economics, just by reading Hazlitt's nifty book "Economics in One Lesson," or by simply going to Mises.org and getting -- free! -- the glorious wisdom of the Austrian School of economics, thanks to the foresight and work of Lew Rockwell, whom I never actually met, but who must be a busy guy because if I call him up and say to the receptionist "Hey! Ask Lew Rockwell if he will lend me twenty bucks!", I find that he's never available, and they won't even take a message anymore. So he must be a busy guy!
I can tell by the look on your face that you are not interested in hearing about another smart person who doesn't want to talk to me, either, and what you really, REALLY want to know is "What turns out to be, as the ultimate Idiot's Delight, the best investment during a period of government deficit-spending and money creation about which you have been shooting your mouth off until we are sick of hearing it?"
Well, since you asked so nicely, I am happy to report that you, too, can succeed financially despite any personal shortcomings, such as being a rude moron who dares challenge me instead of cringing before my towering intellect, and/or having severe behavioral difficulties so that your kids hate you because you are a clueless, terrible parent, and your boss and all your co-workers hate you because you are incompetent at your job which makes their jobs harder, and you naturally hate them in return, stabbing them in the back at every turn, sparing no venom, daring to mix metaphors right in front of their stupid little, hateful faces.
And you can financially prosper even if your spouse and your relatives and your neighbors all hate you, too, mostly because they are all a bunch of small-minded Earth-people whose serious lack of intellectual capacity cannot possibly allow them to comprehend the profound inherent safety and strong security, and thus an invaluable neighborhood asset, of having a Mogambo Big Beautiful Bunker (MBBB) in my backyard, bristling with enough firepower and miscellaneous armaments to kill them all a thousand times over if they give me a bunch of crap, which they, so far, don't.
And so the important, profound answer to the question "How to have a successful, wealthy future despite being a complete moron and your own government is acting like one, too"?
It is (drum roll, please!) to buy gold bullion and silver bullion!
And I think to buy oil stocks, too, because oil has absolutely the most net energy per unit of volume, and it literally comes out of the ground almost ready to use as a fuel. Wow! Talk about intrinsic value that will surely rise with general inflation which is guaranteed by the Federal Reserve creating so much money and credit! How could oil NOT become more expensive?
So, I mean, investment-wise, how could things get any more obvious? Not stocks. Not bonds. Not houses. Not cash. Not anything but gold, silver and oil.
And speaking of "how" could something possibly be, ones wonders how could one NOT shout loud huzzahs, hoorahs, and heehaws to the highest of heavens, nor feel compelled to excitedly exclaim with a happy, giggling glee born of easy, greasy greed, "Whee! This investing stuff is easy!"?
-- Posted Wednesday, 2 January 2013 | Digg This Article | Source: GoldSeek.com