The Ecomony will not Recover until the Government Spends MORE Money!!

because if you know why they invest off shore then you can make corrections and give them an incentive not to do so
but you don't want to know because it will show the lefts policy failure that made it an incentive for them to invest off shore but instead of addressing your failed policy and correct it you rather just punish them for doing so

 

I didn't want to bore you. i specialize in asking unexpected questions that can lead to universal conclusions.
The present recession consists of three elements:
unemployment
wage stagnation
national debt
Unemployment peaked at about double the lowest level we can ever expect and is inching back to its average rate since WWII,right.
The people who are unemployed consist of people in specialized fields with shrinking demand, unskilled laborers who lost well-paying jobs in industries that can't compete with foreigners and drifters who always lose their jobs almost annually. Only the third category will soon return to the workforce and be unemployed again within a few years no matter what happens. The others will never return to a job comparable to where they were and will join the massive category of underemployed. Some will end upon Welfare, Social Security or Disability,and the President is happy with that because that makes the Unemployment rate decrease without new jobs appearing.
Wage stagnation applies not just to the minimum wage but to those one step above it. Businesses prefer to hire people with degrees in management and never promote entry-level workers. Good people leave for the smallest step upward. Bad ones remain, so unproductive they're overpaid at the starting wage. No business can expand when their staff is incompetent, but they can shut down.
Huge chain stores dominate retail and can't increase wages without folding,or don't need to because they have no local rivals. Government can't tamper with the huge companies. Many politicians owe their careers to them and the rest know they'll endanger the country if they cripple them. Now in his second term with nothing to lose, Obama is willing to risk that but few dare follow.
The national debt is untouchable. No one really understands the consequences. Can you explain them?
My point is that Keynes was experimenting with economic theories like the early alchemists. 80years later we should be able to look at some country on this planet that tried something that worked through good times and bad. If no such example exists,we're all still alchemists.
I posted a one-sentence thread here once: Has any country ever elevated itself from third world status through any method that can be duplicated? Is there an answer?

 

I don't care why they stick their money offshore or wherever they hell they put it.

The point is that they do that instead of spending it in the economy like the middle class would.

We've gutted out middle class to enrich the 1% with "trickle down" to the tune of about $600 billion a year and now that great engine of spending, the middle class, doesn't have the income or wealth to drive a robust recovery.

Add Tea Party austerity on top of that and you get weak growth, if any at all.

 

There's one more critical element that has impacted the economy and that's household debt. Until individuals either earn more, find a way to pay off their debt or we have some form of debt relief, the problem will only worsen. With stagnant wages and a middle and lower class increasingly unable to purchase the level of goods and services necessary to sustain and grow the economy, the only people left to spend more are the wealthier among us who still have disposable income. The problem is getting them to spend, and the greatest wealth remains with the least likely to spend because their wealth dwarfs their needs or wants.

 

the rich are rich for a reason because they know how to make money if they make more money investing off shore then here at home that is what they will do, and to correct that trend you make it so they will make more money investing here in America then they make off shore. It is that simple but beyond your comprehension

 

The richer are getting double the share of the nation's income (20%) and wealth (40%) than they did 30 years ago because "trickle down" policies worked so well, except for the part about it trickling down.

And the middle classes, the lower 90%, are now getting only 50% of the nation's income, instead of 65% like they did before Reagan's "trickle down" revolution.

Thus, the great engine of spending, the middle class, doesn't have the income or wealth to drive a robust recovery. Add Tea Party austerity on top of that and you get weak growth, if any at all.

It is that simple but beyond your comprehension. Or you simply refuse to acknowledge fact and logic because of your political positions.

 

I suspect the same people who thought it would be good to tax repatriated money at confiscatory rates, especially since "hording" has effectively stopped since the $5.1 trillion had dropped to $1.7 trillion in just 5 years.

 

Both good old government sources state the amount of "idle" funds, if there is such a thing, had dropped to a relatively small figure.

- - - Updated - - -

Agreed. If they stop the confiscatory taxes on money earned off shore it would come back to the good old USA.

 

That's not what they state at all.

IRS data suggests that, globally, U.S. nonfinancial companies hold at least three times more cash and other liquid assets than the Federal Reserve reports, idle money that could be creating jobs, funding dividends or even paying a stiff federal penalty tax for hoarding corporate cash.

Given the enduring hard times, you might think that corporations have used up their cash since 2009. But real pretax corporate profits have soared, from less than $1.5 trillion in 2009 to $1.9 trillion in 2010 and almost $2 trillion in 2011, data from the federal Bureau of Economic Analysis shows.

That is nearly $1 trillion of increased profits over two years, while actual taxes paid rose less than a tenth as much, BEA reports show. Dividends, wages and capital expenditures all grew less than profits, while undistributed profits rose. The result: more cash.
Bigger profits are good news, but it would have been better news had those increased profits been put to work, not laid off in accounts paying modest interest. Hoarding corporate cash in bank accounts, Treasuries and tax-exempt bonds poses a serious threat to the economy, as Congress recognized when it enacted the corporate income tax in 1909.

Let's get some perspective on these gigantic figures, all measured in today's dollars. The 2009 cash reported to the IRS equaled America's entire economic output that year from New Year's Day through May Day.

For workers, idle cash means idle hands and minds. With one in five Americans unemployed or underemployed, and real median wages in 2010 back down to the level of 1999, this is no time for capital to go on an extended holiday.

Want to motivate companies to put some of those trillions of dollars of idle cash to work creating jobs, paying dividends or sharing the burden of taxes? Call 1-202-224-3121 and tell your senator or representative you want Section 531 vigorously enforced - now - and the offshore loophole closed immediately.

Sounds like good advice.

What difference does it make where they hoard it?

The point is the are not spending it.

 

Your "unexpected questions" do not lead to relative enlightening answers.

We are not in a present recession.[/quote]unemployment, wage stagnation, national debt[/quote]Ah, national debt. Now that is a problem.

Two or three times over the last 70 years.

You should have stopped after "unskilled laborers".

It is unlikely that any of the unskilled labor jobs exported in the last 20 or so years will ever return as we don't need that much unskilled labor.

That kind of labor is not needed in the US anymore.

That answer is much to simplistic to be addressed.

Still very simplistic. We still need well trained tradesmen.

Very simplistic with some validity.

We currently have a class of people who are insufficiently skilled to even accomplish production at the minimum wage level, yet our social system requires they be paid at that level.

 

Reducing Taxes on individuals and businesses and Lessening Regulations on businesses, as well as Spending money more wisely in Washington(Not shelling out more than it takes in). Obviously spending doesn't help because this President has added about $6 Trillion and nothing has really worked. Finding ways to lower energy costs and fuel costs for Americans will also help. This will give Americans more buying power in the economy to help out and promote growth..

 

Absolutley untrue. More cash is sitting idle in banks and companies than ever. Prove your claim.

 

Your own post said that at one time there was in current $$$s 5.1 trillion idle funds and that it was predicted that only $1.7 trillion would be idle at the end of March. That tells us that industry has spent a heck of a lot of money, so what is your problem? Other than your complaint has blown up in your face?

The Fed's latest Flow of Funds report showed that U.S. nonfinancial companies held $1.7 trillion in liquid assets at the end of March. But newly released IRS figures show that in 2009 these companies held $4.8 trillion in liquid assets, which equals $5.1 trillion in today's dollars, triple the Fed figure.http://www.politicalforum.com/showthread.php?t=264376&p=1063601407#post1063601407 ​

 

It did not.

Why the huge gap? The Fed gets its data from the IRS, but only measures the flow of funds in the domestic economy. The IRS reports the worldwide holdings of U.S. companies, which I think is the more revealing measure.

Those are two different figures from different sources.

 

Yet your post tells us that in 2009 the "idle money" was $5.1 and at the end of next month is is projected to be $1.7 trillion.

The Fed's latest Flow of Funds report showed that U.S. nonfinancial companies held $1.7 trillion in liquid assets at the end of March. But newly released IRS figures show that in 2009 these companies held $4.8 trillion in liquid assets, which equals $5.1 trillion in today's dollars,​

Make up your mind.

While we are at it, you have been harping about companies spending expansion money to hire, produce and create more goods. That sounds an awful lot like "supply side economics" you have on occasion called voodoo type economics.

 

They are two different data sets. One is the Fed and the other is the IRS. I've already cite the article explaining why they are different, twice, including the post you just responded to, but you're just playing your little games again.

Furthermore, that isn't what the article says at all, but you don't care.

That was George Bush who called it that. But I haven't been harping that at all.

 

I don't play games, but apparently you do.

It is what you said. Were you lying? I cut and pasted it directly from your post.

YOU have been harping on "idle money" complaining that companies are not spending. You post numbers which prove they have been. Make up your mind, which of those figures is wrong and why? Nothing you explained said why two different government agencies had different amounts of money. Data set one from the Fed said $5.1 Trillion in idle money in today's dollars. The IRS showed $1.7Trillion by the end of March.

BTW, I did read the Reuters report which did partly explain, but quite frankly I don't see your problem. Since they did not break down that $4.8 ($5.1) trillion and only said it was globally that amount in 2009 we have no way of knowing if most or all or almost none of that 4.8 was offshore. If it was, blame the administration for insisting they collect confiscatory taxes on repatriation. I suspect Reuters is wrong. I believe there is much more overseas, money made in profits overseas.

You forget Iriemon, I have experience with you and your games. I remember clearly when you would not accept that it is only in the eyes of the individual whether there is an increase in marginal utility with any given marginal unit. I know you can stretch things.

 

I did no such thing. You know the IRS number includes worldwide holdings while the Fed number is only domestic and that is why they are different. You're just playing your stupid little games.

 

Then why are you acting as if they are comparable numbers why you know one includes overseas holdings and the other doesn't?

False. I never asserted that "idle money" was represented by those figures. As the quote states, those are holdings of U.S. nonfinancial companies. The IRS figure is worldwide and the Fed figures is domestic only.

The holdings of U.S. nonfinancial companies certainly does not represent the universe of "idle money" but only that held by nonfinancial institutions.

The prove no such thing.

They do prove that trillions of dollars in idle cash is being held and not spent in the economy as the article indicates.

It has been explained three times now. Fourth time: The Fed gets its data from the IRS, but only measures the flow of funds in the domestic economy. The IRS reports the worldwide holdings of U.S. companies,

I couldn't care less why they hold it overseas.

LOL

 

The obscenely wealthy are disgustingbecause they refused to retire when they went from filthy rich to obscenely rich. They shouldat least be forced to start a factory in one of the most economically distressed or undeveloped places in the country and make something no one needs and few will ever buy,hire as many persons as thefactory will hold and pay them more than the minimum wage until they have lost so much money they recede back to filthy rich,having meanwhile elevated some people from desperately poor to solvent. When there are nomore obscenely rich people there should be twice as many filthy rich people including some who would have peaked at extremely wealthy if the obscenely rich had not been forced to reduce their excess wealth.
What if we had a maximum wage, so a company couldn't overpay their CEOs. I think most CEOs would retire after only a few years at the top salary so the number of people hitting the top salary would triple within a few years. They could still get richer off their stocks and accept huge consulting fees and book revenue. With more free capital,those companies could easily expand their business with lower paying jobs and diversity. Don't forget, companies still get tax writeoffs if they own both a failing and a thriving business. What if the government offered grants for large businesses guaranteed to lose money annually. What if a small failing business could be taken over by the government and sold at auction to the highest bidder that will keep all employees for at least two years.
That would be a great project for Mitt Romney,instead of laying off people to make a company profitable again.

 

You should care, you whine about idle money so much. Why not vote for someone who will allow repatriation of over seas money without confiscatory taxes?

When and if you can identify which part of the globally held $4.8 trillion ($5.1 Trillion in inflation adjusted money) is domestic and which part is overseas, THEN and only then will we have something to talk about.

According to the Federal Reserve, there was $1.2 trillion in the M0 supply stream as of July 2013 [source: Federal Reserve Bank of New York]. That sounds like an incredible amount, but think about it this way: According to the CIA, there were 316,668,567 Americans alive that month [source: CIA]. If you took all the cash and divided it up equally, each person should have about $3,800 in cash on them (or stuffed under the mattress). Obviously, there's some money missing, but there's an easy explanation for that: The Federal Reserve says that at any given time, between one-half and two-thirds of the M0 money stock of U.S. dollars is held overseas [source: Federal Reserve].http://money.howstuffworks.com/how-much-money-is-in-the-world.htm​

That suggests there is $600 to $800 billion overseas and only $400 to $600 in the US in currency. Bank accounts representing dollar wealth without actual currency being in the system is about $1.7trillion to $1.9trillion in the US checking/easy withdrawal accounts and cash on hand. Add to that all of the savings accounts, money market and CD accounts there is about a total of $10.5 trillion. Thus there is about $1.2 trillion in actual currency and $9.3 trillion in various non currency bank credits actual notes and coins floating around the globe.

Even though the Fed can't say precisely where all the U.S. dollars are in the world, it does try to keep track of how much exists.

What even the Fed or the IRS does not know about US dollars off shore in various bank instruments is who owns those dollars. Are they US corporate funds? Are they individual citizen funds? Are they US dollar instruments held by foreign countries or foreign corporations?

When and if you can answer those questing with some degree of accuracy get back to me; and stop your whining about idle money.

 

It makes no difference where they horde it.

What matters is it is not being spent.

Irrelevant. What matters is it is not being spent.

Banks are sitting on $2.4 trillion in excess reserves -- money they could be lent out but is not.

 

Companies sitting on cash pile of over $1 trillion. Cash set a record in the first quarter of 2013 on an absolute basis: $1.093 trillion in the S&P 500. It has set a record for 18 of the last 20 quarters.
http://www.cnbc.com/id/100911328

Stocks Could 'Take-Off' Due To The $14 Trillion Cash Being Hoarded. The amount of cash in the hands of households, banks and corporations is at an all-time historic high, some $14 trillion in all, Surprise! Surprise! Households have $9.15 trillion in cash, up from $7.5 trillion in 2007 if you add all their deposits together ... The 3000 corporations that make up the Russell 3000 index, which represent 98% of all publicly traded stocks, have over $3 trillion in liquid assets on their balance sheets. ... The banks, for their part, are holding onto some $2 trillion on their balance sheets.
http://www.forbes.com/sites/robertl...ions-and-banks-are-hoarding-14-trillion-cash/

Why American Companies Are Holding Onto $5 Trillion In 'Cash'
http://www.forbes.com/sites/louiswo...ompanies-are-holding-onto-5-trillion-in-cash/

Cash-Hoarding Companies Are Hurting the Economic Recovery. Roughly one-third of the world's largest non-financial companies, including Apple, Microsoft and Google, are hoarding $2.8 trillion in unspent cash, preventing much-needed funds from entering the global economy and stalling our recovery from the 2008 recession.
http://www.thewire.com/business/2014/01/companies-hoard-cash-trillion/357254/

Excluding banks, the Standard and Poor's 500 stock index has 216 companies that are sitting on $1 billion or more in cash or short-term equivalents. t's no secret that many companies are sitting on enormous amount of cash – a total of $1.25 trillion in companies in the S&P 500, according to Standard and Poor's Capital IQ.
http://www.usatoday.com/story/money...companies-shared-cash-with-employees/4496341/

According to research from American Express Publishing and Harrison Group, the savings rate of the wealthiest 1 percent soared to 37 percent in the second quarter. That's up from 34 percent in the second quarter of 2012—and more than three times their savings rate in 2007.
http://www.cnbc.com/id/100935856

 

So why aren't they spending it? Its not corporate! Fear about economic policies? I save too. What's your problem.

 

From your link!

Moving right along, financial reporters seem to believe that the presence of large amounts of cash on corporate balance sheets means that the companies aren’t investing, or that they should be investing more.



While it is true that real, productive investment is far below the levels needed for robust economic growth, you can’t tell this from the size of corporate cash balances. Investment is “flow.” Cash balances are “stock.”



By one accounting, big companies are holding about $5 trillion in “cash.” If they spent all of it tomorrow, the day after tomorrow, these companies’ cash balances would probably total close to the same $5 trillion. This is because, from the point of view of the private economy, cash cannot be created or destroyed; it can only be moved around.



We can confidently expect that the rate of cash accumulation will slow down. This is because cash production is slowing down. During the past year, federal DHBTP increased by less than $0.8 trillion, or 6.7%.



The amount of (dollar) “cash” that the world holds is determined by the actions of the U.S. government. Decisions made by the private sector can’t impact the total. So, it is best not to assign any great meaning to how much cash is being held, or by whom.​

So its not as bad as you thought eh? So XYZ Corp spends 5 trillion to expand paying that money to ZYX Corp. There is still 5 trillion in Corp coffers.