Tax Cuts will Balloon US Debt to 120% of GDP, but Boost to Economy will be “Short-Lived”

US is the “most indebted AAA-country” and runs “the loosest fiscal stance,” but the dollar as Reserve Currency still props it up: Fitch

It’s uncertain what if anything in the mix of tax cuts and tax increases being kicked around in Congress will become law. But Fitch Ratings believes that some combination will make it, and that it will sap US government revenues. “Under a realistic scenario of tax cuts and macro conditions,” the US deficit would rise to 4% of GDP next year, and balloon the US debt to 120% of GDP by 2027.

And that might be the best-case scenario.

That debt-to-GDP ratio just shot up to 105% – based on annualized Q3 GDP of $19.5 trillion and the US gross national debt of $20.5 trillion that had spiked by $640 billion in eight Weeks, following the suspension of the debt ceiling in September. The debt-to-GDP ratio was 103% earlier this year.

Fitch said in the report that it expects some version of the package to pass the US Congress, and that it “will be revenue negative, even under generous assumptions about its growth impact.”

The tax package, which includes cutting the corporate tax rate from 35% to 20%, “would deliver a modest and temporary spur to growth,” Fitch said. Even with these tax cuts, Fitch expects US economic growth to peak at 2.5% next year and then fall back to 2.2% in 2019 – the same kind of economic growth the US has seen since the Financial Crisis. So any boost to output from the tax cuts would be “short-lived.”

These tax cuts would “not pay for themselves or lead to a permanently higher growth rate,” Fitch said, adding:

The cost of capital is already low and corporate profits are elevated. In addition, the effective tax rate paid by large corporations is well below the existing statutory rate.

Throwing in these tax cuts to add to demand “at this point in the economic cycle” could boost inflationary pressures and “lead to additional monetary policy tightening.”

This is something various Fed governors have also suggested. The Fed has already begun the QE unwind, has hiked its target rate four times so far, and is very likely to hike it again in December. More rate hikes are on the menu next year, but for now they’re expected to be few and far between. This could change if inflation, perhaps stimulated by tax cuts or whatever, picks up steam.  Higher rates might follow, which would further increase the government’s cost of funding, the deficit, and the debt.

So the tax cuts “will lead to wider fiscal deficits and add significantly to US government debt.” Fitch added the not very veiled warning concerning the AAA-rating Fitch still maintains on the US:

The US will enter the next downturn with a general government “structural deficit” (subtracting the impact of the economic cycle) larger than any other ‘AAA’ sovereign, leaving the US more exposed to a downturn than other similarly rated sovereigns.

The US is the most indebted ‘AAA’ country and it is running the loosest fiscal stance. Long-term debt dynamics are also more negative than those of peers, with health and social security spending commitments set to rise over the next decade.

At this point, Fitch believes that these weaknesses are still “outweighed” by the “flexibility” the US enjoys in financing its debts – the entire world clamors to buy US Treasuries for now – and by “the US dollar’s reserve currency status.” These two factors combined are still “underpinning” Fitch’s AAA/Stable rating.

These are longer-term considerations that could impact the US credit rating after the tax package takes effect and starts having an impact on deficits and the debt.

Short-term, there is another risk to the AAA-rating: Congress’s “failure to raise the debt ceiling” by the first quarter next year, when the Treasury Department runs out its “extraordinary measures” that allow it to kick the out-of-money date down the road.

The current suspension of the Debt ceiling expires on December 8. Then the debt ceiling charade will be back, along with the brinkmanship among lawmakers to extract from each other some concessions by holding out the possibility of a self-inflicted US default. This makes bondholders and ratings agencies nervous.

But the debt-ceiling charade has some peculiar effects, beyond its entertainment value: For months on end, it covers up the true extent of US government debt, and its continued surge. Then suddenly, the floodgates open. Read…   US Gross National Debt Spikes by $640 billion in 8 Weeks

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  57 comments for “Tax Cuts will Balloon US Debt to 120% of GDP, but Boost to Economy will be “Short-Lived”

  1. Joan of Arc says:

    The tax cut as proposed will put $2 trillion into the pockets of the top 1% billionaires like Trump over the next 10 years and take $400 billion out of the pockets of the bottom 80% over 10 years. Trump hated the AMT tax and made sure that it was abolished. The proposed tax cut will ad over $2 trillion to the federal debt over the next 10 years if there is no recession. If there is, then add $10 trillion to $20 trillion more to the Federal debt over the next 10 years. This is a nice tax cut if you are in the top 1%.

    • van_down_by_river says:

      As Donald Rumsfeld said: “Ronald Reagan proved that deficits don’t matter”

      Republicans are in complete control, this is their show, and they have always loved ballooning government spending and shrinking tax revenues – they just want everyone to be happy!

      Don’t worry inflation can pay for everything, we don’t even need taxation. With a $20 trillion economy the government and banking system need only institute a 20% rate of annual inflation to pay for total government spending. It’s the perfect solution, 80% of Americans save nothing and only stand to gain from inflation as their debts float off on a soft breeze of reduced purchasing power. The only ones who lose are those awful, stingy, money grubbing savers (hoarders as Bernanke referred to them) and we all agree those scoundrels deserve what they get.

  2. AGXIIK says:

    As much as I dislike making predictions I will make one regarding the exponential increase in the US National debt
    $600 billion in structural deficits today
    $600 additional deficits starting tomorrow (which is today)
    $300 billion increase in interest on the national debt
    National debt increase year over year
    $1.5 trillion
    New national debt in 8 years $12 trillion And that is on the low side, does not take into account increasing deficits due to inflation or some very costly kinetic action that Deep State and MIC are hankering to kick off.
    This prediction is approved by Jim Rickards

  3. Maximus Minimus says:

    A little political economy on the side. China created the One-belt-one-road to invest surpluses away from US treasuries. The US state department doing the rounds telling the involved countries, the US block can compete with One-belt-one-road. That includes Japan, so further diverting surpluses from US treasuries. The question is who is going to buy the treasuries when you most need it? Yields will have to rise.

    • Drango says:

      China and Japan will have to keep buying treasuries as long as they have to have trade surpluses, which is basically forever. Think of it as the Asian version of the petrodollar. They enable U.S. debt, and we allow them to cheat at trade. It’s an unhealthy relationship for both sides, but neither the White House nor the Fed has the will or the intelligence to stop it.

      • Ed says:

        This road doesn’t go on forever. Maybe until we are dead (I can’t even guess a date), but not forever.

        Eventually, China’s own internal market will be large enough that it needn’t depend on exports to the U.S. for growth. If that dependence gets low enough, then they will stop buying.

      • JZ says:

        Trump is barking at every country to reduce their trade surplus to US, including Canada. The game script of US is simple. Run trade deficit so that the rest of the world will swim in $ while US exchange paper for real goods. Let the rest of the world’s business borrow $ and increase production assuming US consumption is strong and the suddenly reverse the trade deficit to starve the world
        of $ and then go buy the over capacity businesses from the rest of the world with cents on the dollar. Trump is the reverse phase.

    • Rates says:

      The Fed? QE Part Infinity? They can always use their “Luxembourg subsidiary” to do it.

    • George McDuffee says:

      RE: The US state department doing the rounds telling the involved countries, the US block can compete with One-belt-one-road.
      —–
      The problem is putting your money where your mouth is.

      While the Chinese international development projects [one belt one road] certainly benefit the PRC by putting their supplies of food and raw materials on a more secure basis, these projects also greatly benefit the recipient countries, for example by resurrecting their moribund colonial era railway systems for example African mining and agriculture. Not only will the regenerated railways provide for export of raw materials, these will more closely integrate the host countries, and provide domestic interior access.

      By contrast, U. S. “investments” tend to strip the host country of depeatable physical assets [destroying the local ecology in the process], and generally involve financial engineering, generally involving the U. S. controlled IMF and World Bank, that strips the host country of monetary independence and saddles it with unpayable debt, ala Tony Soprano.

      A further example: in spite of the spending of billions of taxpayer dollars, we have been unable or unwilling to restore more than a small fraction of the Iraqi infrastructure and public building we destroyed in the unnecessary and illegal [as per the Nuremberg precedents against waging aggressive war] interventions in that unfortunate country.

    • JZ says:

      FED, ctrl-p

  4. Bruce t. says:

    Demographics would seem to suggest (rather strongly!) the deficits and concurrent debt can only rise unless $$$ spent on the retired and retiring boomers is curtailed! Those are the people who do vote though.
    How in whatever world of “thought” the ‘pundits’ and ‘eggheads’ reside will such debt ever be repaid????
    Methinks a return to serfdom for many is in store as those who own the debt own the land and all that is on it.

  5. TJ Martin says:

    What ‘ boost ‘ to the economy ? Having seen whats being touted as Tax Cuts and a Tax Plan first hand the barely comprehensible beast is in fact nothing more than a benefit to the extremely wealthy and the ‘ chosen ‘ few corporations … with the likes of you and I Wolf … benefiting minimally… and everyone else on down taking it in the shorts with their taxes going up while education , healthcare 401k’s etc crumble into the seams and threads of the very wealthiest back pockets .

    Hell .. read the damn things minute details .. even real estate and mortgage companies will take it in the shorts with interest rate deductions for residential real estate going the way of the Dodo . Whereas commercial real estate ? Big surprise … there’s huge new deductions in place for commercial real estate

    All political affiliations aside … suffice it to say regardless of which side of the aisle you reside on … this … cough … tax plan benefits hardly anyone to the detriment of almost everyone

    Not to mention adding another $1.7 trillion in debt over the next ten years.. over and above the already expected amount of debt we’d be accruing regardless of whether or not this misguided excuse passes

    • George McDuffee says:

      REL …and everyone else on down taking it in the shorts with their taxes going up…
      —–
      Indeed!
      IIUC it is proposed to classify the tuition wavers received by graduate teaching and research assistants at our universities as taxable income. The counterproductive effects of this highly regressive policy change are obvious.

      There will be very little additional governmental revenue produced, and we destroying one of the significant ways the education of our next generation of intellectual leadership is partially funded.

      Far better to eliminate the “carried interest” tax preference for hedge fund managers.

  6. akiddy111 says:

    I don’t think US debt is a very serious problem right now. It would be if other major economies were fiscally responsible.

    Stockman was worried about the $1 trillion national debt in 1982, Gary Hart and Walter Mondale told us how miserable the misery index looked in 1984.

    Ross Perot in 1990 moaned about the Debt being a time bombed that will destroy America.

    Today in 2017… Glass half full or half empty ? Depends on outlook, i guess

    • Mary says:

      Notice that when Obama was in office, Republicans claimed the national debt was at crisis proportions and would saddle our grandchildren with an economic nightmare. Now suddenly, it’s “not a very serious problem”.

    • Rates says:

      The debt will NEVER be a problem. The question is whether 500 dollar bacon is a problem. Because that’s where this thing will eventually head to.

      • Sreeni says:

        It is not that the size of federal debt creates huge inflation. It is that it lowers the interest rate that US can tolerate. More debt the govt adds, lower the interest that the Fed can allow. This affects the consumption & standard of living of the aged. The debt in other words creates more distortions than inflation measured with CPI.

    • Mike says:

      Everything will be alright, until it isn’t. The Titanic was fine, until it sank.

      The U.S. will be fine, until it loses its world reserve currency status. As Jim Rickards has pointed out the “petro-dollar” status is already going out the window, because countries are selling oil for difference currencies or effectively, gold.

      That means that as time goes by there will be fewer and fewer people that actually NEED the U.S. dollar. Right now, we are still in the rosy afternoon of reckless tax cuts, because so many countries have dollar-denominated debt and world conditions favor the sale of U.S. treasuries.

      It makes me wonder: do other countries that issue dollar denominated debt know something that we do not or to they just have common sense and a knowledge of economics? I think that the latter is true. If the dollar goes down in value, their debts are automatically reduced.

      We are not so “special” (unless you are referencing our current leader’s “special” intellectual abilities and desire for sycophants to pander to his ego) and will face a hard realization sooner or later. This rosy afternoon will be followed by a dark night.

      The consequences that will follow if the U.S. completely uses it word reserve currency status will be dire. China and other countries dependent on U.S. markets will need to first diversify their consumers and seek other markets.

      However, that is happening and will accelerate: e.g., Vietnam, Thailand, and other countries are growing into alternative markets. When the day of reckoning comes, we will be glad that we produce food, so at least we will not starve: unless the example of the British empire’s “Irish” food producers’ during the Irish Famine is followed and food producers ignore U.S. starvation to ship out food to other countries and thereby make a profit through allowing the death of thousands.

      Since the collapse must come, I hope that it happens during the Trump administration, so the corrupt Republicans and Trump will get the well deserved blame for the U.S. economic that their irresponsible, moronic tax cuts deserve.

      However, it might come during a later, Elizabeth Warren Administration or Bernie Sander’s administration. Then, they will get the blame for the recklessness, greed, and incompetence of the current Republican congress and president.

      • truth always says:

        I second Mike’s thoughts. In about 10 years the petro-dollar is dead. The Chinese and others are forced to accept it to avoid unrest in their populations.

        But how come American can just add a zero or two to the right and balance everything? Everyone gets it but there is not an alternative yet, due to America’s preponderance in the global banking system.

        With the Russia China deal getting oil for yuan and changing yuan for gold, it may be an alternative to the US $. Won’t happen overnight or fully but would put a dent in the $ in about a decade.

        Either that or Bitcoin.

        America has hoodwinked the world in its own fake prosperity simply on the once real strength of the $ but won’t always be able to.

      • Suzie Alcatrez says:

        Jim Rickards has been saying the dollar is doomed and everyone needs to buy gold for the past 20 years.

        Also buy gold mining stocks traded on Canadian stock exchanges.

      • Smingles says:

        “The U.S. will be fine, until it loses its world reserve currency status. As Jim Rickards has pointed out the “petro-dollar” status is already going out the window, because countries are selling oil for difference currencies or effectively, gold.”

        Nope. Not even close. In fact probably the opposite. As US deficits increase, the petro-dollar becomes more important. I realize that is counter-intuitive.

  7. mean chicken says:

    “brinkmanship among lawmakers to extract from each other some concessions by holding out the possibility of a self-inflicted US default. This makes bondholders and ratings agencies nervous.”

    Default is a slow process, then it happens all at once.

    • George McDuffee says:

      Another good argument for simply eliminating the farcical “debt limit.”

  8. Kent says:

    I have absolutely no idea why people think it is a good idea to cut the corporate tax rate. Is there an expectation that corporations will then invest those untaxed dollars back into the US economy? Why wouldn’t they invest them in the much faster growing and cheaper Chinese economy?

    If they use those tax to increase dividends, do we expect these folks to increase demand in the real economy? Or just buy more stocks?

    Or maybe they’ll use the money to buy the new treasury bonds. In which case all we’re doing is handing treasury bonds to corporations. It makes no sense.

    • Suzie Alcatrez says:

      They are under the mistaken assumption that companies will use the extra money to hire more employees.

      • Ed says:

        I don’t think they really believe that. That’s the sales pitch.

        Are companies today taking out loans to raise employee wages? I recall they’re taking out those loans — mainly — to do stock buybacks. I figure the new cash on hands will go where the borrowed money has been going lately.

      • RangerOne says:

        Like many ideas in politics the idea the tax cuts to the investor class or companies will lead to more jobs is simply the easy to digest talking point that Repubs use to sell tax cuts to the rest of us.

        The reality is that it is complicated and clearly politicians are motivated to make these changes for personal gain. I suspect most common people who defend this talking point are simply being partisan because there is no reason to believe your employer will suddenly give you a raise because the company is more profitable.

        You get a raise when your labor is worth more due to competition, which is generated by demand for your companies profit. A CEO of a public company is obligated to keep costs as low as possible regardless of how much higher their profit goes.

        Though I am sure there are cases were a tax break would free up money to say expand faster. But you still need the core demand for your product to be growing.

    • Mike G says:

      I’d be OK with cutting the corporate tax rate if they actually paid anything close to the headline rate — where’s the Alternative Minimum Tax on corporations?

      Their lobbyists have written so many loopholes into the tax laws that many of them pay little or nothing. Boeing’s federal tax rate last year was -1.4% (yes, that’s a minus — they got a $82 million refund).

      Or they pile up money offshore waiting for another repatriation tax holiday giveaway like Bush gave them in 2004 — almost all of which went to executive bonuses and stock buybacks.

      Funny how nobody is offering such goodies to individual taxpayers.

      • RoseN says:

        But why does the average person in America not see this? I don’t hear enough outrage over the proposed tax plan, and I live in one of the most liberal parts of the country (the Bay Area).

        Is it that companies work people so hard that everyone is exhausted and has no time to think of such matters? Marx said that religion was the opium of the people. The modern-day mantra should be “work is the opium of the people!”

        • Realist says:

          I suppose very few people on Main Street are aware abour how things actually do work. Education, media et all do peddle in ignorance. In addition, most people do not care because they do not grasp it.

    • Wolf Richter says:

      I’m actually ok with cutting corp tax to 20%, or even 15%, but apply it to GAAP earnings, or better yet, to “adjusted earnings” touted to investors… LOL

      • Gershon says:

        And outlaw share buybacks with borrowed money. Make the 15% rate contingent on capital investments in R&D, productive capacity, and expanding the work force, not playing in Wall Street’s rigged casino.

        • Night-Train says:

          You are on the right track. I was promised “trickle down” in 1980 and I am still waiting. To be fair though, the beneficiaries of Reagan’s supply side tax cuts did create jobs. Unfortunately, those jobs were created in other countries.

    • Roger says:

      If the corporate tax rate is cut from 35 to 20 percent, the lobbyists will immediately start to work on creating new loopholes. It wouldn’t be long before the effective corporate tax rate is in the low single digits. Today, the effective rate is 12 percent.

      • baldski says:

        Roger, I think the plan would then be to get the effective rate negative and have the whole corporate segment of our country become “welfare queens” . After all they are people you know, and we have to take care of our people.

      • d says:

        the effective rate is 12 percent.

        WRONG

        Today the effective corporate rate is zero as the “Tax” is on sub EBIA Numbers,

        The Corporates simply adjust their Gross margins, to get the take home they want.. And the consumer pays the tax.

        Corporate tax, needs to be on the gross profit, before any deductions,

        With a Heavy penalty, for increasing margins beyond norm. To transfer TAX COST to the consumer .

        Then, and only then, could Corporates be considered to be paying tax. .

        • Gene says:

          You know, there is such a thing called GAAP, generally accepted accounting principles. Expenses cannot be moved willy-nilly around the income statement with the expectation that an outside CPA will render an unqualified opinion on the annual statements.

          Aside from that, there’s the elasticity of the demand curve to consider; as studied in basic microeconomics. Not every cost of doing business can automatically be passed on to consumers.

        • d says:

          “Aside from that, there’s the elasticity of the demand curve to consider; as studied in basic microeconomics. Not every cost of doing business can automatically be passed on to consumers.”

          Every cost of business, is passed on to consumers, as the profit margin after costs (Including tax as a cost), is maintained. By adjusting the gross.

          When i did accounting, and still in our country we only have 1 set of accounting standards.

          Not 1 for Tax and one for market reporting, as they do in the US. Where they move things around the Balance sheet to achieve this.

  9. tony says:

    We are headed for high inflation. On the bright side goldman sucks will take that tax cut profit and keep it.

  10. JB says:

    Tax cuts without a corresponding decrease in expenditures is pure fiscal ineptitude. The plan does have some virtue , such as elimination of some deductions . Similar to ZIRP these deductions cause malinvestment in certain industries . As an example; the deduction for state and local taxes would maybe force New York and California to get their houses in order or risk a demographic shift to other states. Government GDP is supplanting private GDP. Also congrats Wolf on D. Stockman utilizing one of your articles

    • Dan Romig says:

      I read yesterday’s “‘The Black Swan In Plain Sight’ – Debt Out The Wazoo” which was written by Stockman also JB.

      http://www.zerohedge.com/print/606765

      Nice quote from it: “… the always excellent Wolf Richter published a great chart over the weekend on the exploding US public debt.”

      TJ Martin makes a good point on Trump’s plan to continue giving tax breaks to commercial real estate developers. As the NY Times (although the NY Times is not a bastion of great truthfulness – IMO) states, “An industry familiar to President Trump appears to have emerged from the Republican tax rewrite relatively unscathed: commercial real estate.”

      https://www.nytimes.com/2017/11/03/us/politics/commercial-real-estate-trump-tax-package.html

  11. Nick Kelly says:

    The last time there was a run on the US$ Paul Volcker raised the Fed rate over 20% to restore confidence. That might not be possible when the next time arrives, as the interest on US debt would skyrocket.

    At some point spending will have to be slashed. One place to start: health care. The US pays roughly double anyone else ( Canada, Germany, Norway etc.) But even that number understates US waste. The US spends almost exactly double what Canada spends PER CAPITA.

    In other words the US spends twice as much per person, but a lot of those people aren’t covered. Canada spends half as much with better outcomes (see all the universal metrics) but covers EVERYONE.

    You are going to go after big fish to move the needle, and at around 17% of the economy, health care qualifies.

    • Roger says:

      I would categorize “defense” expenditures as the #1 place for cuts. I spent most of four decades as either a civilian budget analyst or as a contract auditor. The waste was humongous even during the Carter Administration, which promulgated zero based budgeting.

  12. Gershon says:

    Why would anyone in their right mind “invest” in monetized US debt that is going to be printed away by the Fed?

  13. d says:

    Should read

    Many Parliamentary Democracy’s, have an issue, with the left continually buying elections, with long-term untenable financial handouts

  14. The Republican strategy is to “Starve the Beast” the policy stated by Grover Norquist (circa 2000), Americans for Tax Reform. The goal of downsizing the federal government is achieved by bankrupting the federal government. Conservative fiscal probity was replaced by scorched earth policy, the monetarists are there to provide bread and circus, though Europe remains a center of the old Socialism, the new Socialism is corporate, like the new Libertarianism. Of course the Dems can call for spending cuts to balance the loss in revenue but you can see where that is going.

    • fajensen says:

      And once government has been “rightsized” … America will look a lot like Somalia (maybe India, if they are lucky in managing the transition to rule by feudal lords).

      Americans better get themselves used to seeing people travelling with guns everywhere they go – and stop droning them :)

  15. JM Keynes says:

    – Even Fitch overlooks a few things, fails to see the entire picture.
    – The US is indeed subsidized by foreigners (think: PetroDollar). But this doesn’t automatically mean that the US will be subsidized by foreigners into the far future. How much the US is being subsidized is determined by (among others) the US consumer (think: Trade Deficit and Current Account Deficit). If the US consumer starts “to reduce” its spending (for whatever reason) then the Trade Deficit will shrink as well and even turn into a Surplus. And when the Trade Deficit shrinks to zero then the Current Account will shrink to zero as well. And the size of the Current Account Deficit (CAD) determines how much the US is subsidized by foreigners.
    – The time frame 2006 -2009 gave us an indication of what’s going to happen when the Trade Deficit shrinks to zero. In that timeframe the CAD went from a record $ 880 billion down to about say $ 200 billion. This was the result of falling import prices and falling import volume(s).

  16. Nick Kelly says:

    Americans are going to suddenly and significantly reduce spending on consumer electronics, 27 percent of Chinese imports and on clothing, 19 percent of Chinese imports?

    Americans are no more likely to solder assembly line electronics than they are to sew clothing panels, or pick lettuce. These industries, except for niches, no longer exist in the US.

    What is going to be made in the US and then shipped to Asia to create a ‘trade surplus’ to counter the 300 billion surplus China has in the above mentioned areas plus a bunch of low price, low margin Walmart stuff?

    There is no way to create a US trade surplus in manufactures and the only way to dramatically reduce the trade deficit is with very large tariffs, thus making the US consumer pay much more for the items now imported.

    • mean chicken says:

      “the only way to dramatically reduce the trade deficit is with very large tariffs, thus making the US consumer pay much more for the items now imported.”

      These problems were created by Congressional tax law, not b/c of the hubris that enables criminal conduct but as a result of greed on behalf of special interest groups.

      Free trade implies but isn’t, fair trade, so don’t confuse them. When I can buy high quality replacement parts from a foreign country for less than the postage should be, something’s amiss. I figure it’s due to US taxpayer largess.

  17. walter map says:

    It speeds up the rentier extraction, economic liquidation, and social repression processes, but they’re on course to bleed the US dry and lock it down anyway. It moves up the timetable, but not the outcome. A lot of the country has already achieved third-world conditions, so it’s not as if those are going to notice much difference.

    If the country had voted for something else it wouldn’t have these problems.

  18. JM Keynes says:

    – The following is also “not helpful” to reduce the debt. The Senate approved a $ 80 billion annual increase of the defense budget. Perhaps this was the proverbial “last straw on the camel’s back” for Fitch.

    https://www.youtube.com/watch?v=f1kJVmai7c8

    https://theintercept.com/2017/09/18/the-senates-military-spending-increase-alone-is-enough-to-make-public-college-free/

  19. Gershon says:

    What’s going to happen to the tax base when the Fed’s Ponzi markets implode and for the next decade burned “investors” are able to write off $3000 a year in stock losses?

    • George McDuffee says:

      With the stroke of a pen that tax deduction [carry forward losses for individuals] will be eliminated.

      • d says:

        “With the stroke of a pen that tax deduction [carry forward losses for individuals] will be eliminated.”

        thats why anybody who trades should have it set up through an Entity structure.

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