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Kent,
Good points -- tax breaks for R&D, capital spending, etc. are
effectively tax cuts designed to stimulate some part of the
economy. Whether they work or not seems to depend on who you talk
to. Personal tax rates today are lower than the marginal rates of up to
70% that prevailed for most of the post WWII period (90% briefly during
the Korean War), but we have the Alternative Minimum Tax hitting a larger
number of high income families every year.
The elimination of taxes on dividends had an immediate impact on
the Utilities. Since money flees taxation, the dividend tax elimination
will probably continue to favorably impact dividend yielding Dow 30 / SnP
500 stocks while drawing money from the Hope & Glory NAZ. Will this weaken
investment in new US technology? REITS don't participate in the dividend
tax relief. Will this take some air out of real estate? Will this tax
policy draw some widow and orphans' money from CD's, bonds or
T-Bills? What will be the effect on foreign investment in the U. S.
market? Will it be extended beyond the three year period? I don't have a
clue. Ideas welcomed!
BTW -- Ref the suggestion that if you don't pay taxes, you don't
vote -- 30-odd years ago oilman HL Hunt floated a tongue-in-cheek
proposition that the more taxes you pay, the more votes you should
have. He suggested that people would be falling all over themselves to pay
more in taxes.
Charles Marchand
At 01:21 PM 5/27/2003 -0400, you wrote:
>Also, it depends on which taxes are being cut and what their relative level
>is. If taxes are very low (which they are not today), then tax cuts would
>probably result in lower revenue.
>
>Kent Rollins
>
>
>----- Original Message -----
>From: "Charles Marchand" <c_r@xxxxxxxxx>
>To: <realtraders@xxxxxxxxxxxxxxx>
>Sent: Monday, May 26, 2003 11:29 PM
>Subject: Re: [RT] Tax Cuts
>
>
>Lenny,
>
> None of the above.
>
> Tax cuts and resulting governmental income do not happen in a
>vacuum. A, B, C might apply if there were no other macro-economic factors
>at work in the global or national economy.
>
> BTW -- Not interested in spin either.
>
>Charles Marchand
>
>
>At 09:43 PM 5/26/2003 -0400, you wrote:
> >Charles,
> > Just so I'm clear on your point of view and for the eyeballing public
> > record. Please respond to the following:
> >
> >Tax cuts generate:
> >
> >A) More revenue to the US Government.
> >B) The same revenue as if there were no cuts.
> >C) Less revenue to the US Government.
> >
> >Oh, just in case, please just answer the above question A, B or C. I'm not
> >interested in spin!!
> >
> >Thanks in advance!
> >Lenny
> >
> >In a message dated 5/26/2003 9:27:14 PM Eastern Daylight Time,
> >c_r@xxxxxxxxx writes:
> >
> >>Can't let this pass -- the Reagan tax cuts have become a mantra of
> >>Republican policy. Fact is the tax cut of 1986 was accompanied by the
> >>collapse of oil prices. In January '86 prices went from over $25/BO to
>$10
> >>or so. The US was using around 16,000,000 BO PER DAY. Do the math.
> >>
> >>Charles Marchand
> >
> >
> >
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