Article

2014-09-20 Economy

Yellen says US families need to boost savings

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Posted by Fred 2014-09-20 00:00|| || Front Page|| [11132 views ] Top

Our market manipulation game is actually quite simple. When we talk of reductions in 'Quantitative Easing' and the market tanks...... you must BUY. When we talk of continued low interest rates and QE sustainment, and the market skyrockets......you must SELL. Make some dough, keep your eye on the yoyo.

Posted by Besoeker 2014-09-20 00:49|| 2014-09-20 00:49|| Front Page Top

#2 Step 1: Stop taxing interest income.

Posted by badanov 2014-09-20 01:03|| http://www.chriscovert.net 2014-09-20 01:03|| Front Page Top

#3 "stop taxing interest income" What interest income? Most savings accounts pay much less than 1% nowadays, a huge drop from pre-2007 levels.
I have read speculation that if Americans suddenly boosted their savings efforts to match recommendations, the economy (70% based on consumer spending) would collapse. A drastic cut in government spending would have a similar effect. We're trapped, like rats, in a maze of our own making.

Posted by Anguper Hupomosing9418 2014-09-20 04:51|| 2014-09-20 04:51|| Front Page Top

#4 At least cutting government spending would harm the right people.

Posted by no mo uro 2014-09-20 05:16|| 2014-09-20 05:16|| Front Page Top

#5 How about this.....

Deport every last illegal. Let go 50-75% of the public work force. Give them a choice between doing the jobs the illegals now do at a vastly lower standard of living or starving to death.

Any business owner who gets caught hiring an illegal goes to jail for five years, no exceptions. In a corporate environment put officers of the company in jail along with the person who did the actual hiring.

Change the rent-seeking regulations that have turned Wall Street from a place that makes money off of the quality of transactions into a mill that skims off of quantity of transactions.

Peg the interest rate at the true cost of lending money.

Then watch as the economy booms AND people start saving.

Posted by no mo uro 2014-09-20 05:26|| 2014-09-20 05:26|| Front Page Top

#6 Before the collapse, 'economists' were complaining Americans weren't saving enough. When the 'smart' people in DC were trying to jump start the economy a couple of years ago, their 'economists' were bitching that Americans weren't spending enough. Now we have the Fed saying that we need to save more again. Maybe because its dawned on the central planners that the reason, after inflating the economy with a gazillion unbacked dollars to save the campaign slush fund donors, we're not experiencing Wiemar inflation levels is because Americans are indeed socking as much as they can away for the next big engineered bubble burst. Just like 'war bonds' were sold to put an incredible amount of 'printed money' value away for years in order to avoid immediate inflationary impacts on the economy.

Posted by Procopius2k 2014-09-20 08:49|| 2014-09-20 08:49|| Front Page Top

#7 Translation: "We know you have money the big banks haven't been able to steal. Yet. Pony up."

Posted by ed in texas 2014-09-20 09:03|| 2014-09-20 09:03|| Front Page Top

#8 I have been told by some of my most liberal aquaintences that saving my money is greedy.

Posted by Deacon Blues 2014-09-20 09:17|| 2014-09-20 09:17|| Front Page Top

#9 Yes, the plantation owners and overseers hate the ~~slaves~~ workers who put a little aside for themselves from their labors and toils.

Posted by Procopius2k 2014-09-20 09:33|| 2014-09-20 09:33|| Front Page Top

#10 "Trust us"

Posted by Frank G 2014-09-20 09:47|| 2014-09-20 09:47|| Front Page Top

#11 Don't talk to me Janet. I'm still waiting for the return of my retirement savings that disappeared in 2008. All tapped out. Next time, I will put my investments into guns and beer.

Posted by JohnQC 2014-09-20 10:23|| 2014-09-20 10:23|| Front Page Top

#12 When wealthy save money it is hoarding and unpatriotic when the poor fail to save it is bad for the economy.

Stop printing, borrowing and spending money and also stop creating GIVERnment Ponzi schemes.

FORWARD to the Detroitification of America!

Posted by Airandee 2014-09-20 10:39|| 2014-09-20 10:39|| Front Page Top

#13 I have been told by some of my most liberal aquaintences that saving my money is greedy.

Feh. It's not greedy, it's pointless: the real inflation rate far outstrips any meager interest parked cash might earn. Saving is the best way to screw yourself, without benefiting anyone else.

"Selfish" is paying down debt as fast as you can. Deleveraging is the best way to benefit yourself, but not really anyone else. If everyone did this simultaneously, the whole system would crash. (IMHO, this would be a good thing, but that's another story).

"Greedy" is obtaining huge lines of credit, using the entirety thereof to buy physical precious metals, and then defaulting and disappearing. Bonus style points for stiffing JPM Chase.

Posted by RandomJD 2014-09-20 11:06|| 2014-09-20 11:06|| Front Page Top

#14 According to the left, Soros is not evil but the Koch brothers are?

Posted by JohnQC 2014-09-20 11:37|| 2014-09-20 11:37|| Front Page Top

#15 The left destroys the middle class and then screams for more money via savings? That takes a great deal of brazenness or chutzpah. Washington and Detroit model.

Posted by JohnQC 2014-09-20 11:42|| 2014-09-20 11:42|| Front Page Top

#16 Does she reccomend more Brioche?

Obviously she's telling us to save more because interest rates are so high...

Don't worry, credit-marxists don't need anyone to do real work.

Posted by Bright Pebbles 2014-09-20 12:10|| 2014-09-20 12:10|| Front Page Top

#17 First stop the obscenity of taxing Social Security and Unemployment Payments.

Stop taxing gasoline and diesel.

Stop taxing capital gains on home sales

Stop printing money, boost the prime interest rate to stop the idiot speculation on Wall Street and once the interest paid on savings exceeds the rate of inflation, people will start saving.

Oh by the way, stop taxing the proceeds from IRAs and 401k at the other end.

And of course stop taking interest income, that would do something for savings.

AND stop allowing banks to charge these idiot "use" fees to hold your money or use an ATM. My current bank pays 1.35% on savings and collects a $6 a month fee for maintaining the account. Seems the $6 fee always cancels out the interest...I wonder what would happen if my interest was more than $6 per month...would they raise the fees?

Posted by Bill Clinton 2014-09-20 12:34|| 2014-09-20 12:34|| Front Page Top

#18 Someone told me that a 1% increase in the interest rates set by the Fed would increase the cost of the debt service on the national debt by an amount larger than the defense budget. The hole is now too deep to remedy without some genuine pain, and entitlement cuts for the taking/stealing class will create civil unrest. So gutless Washington will do nothing but borrow and spend and wait until it all goes boom......when it was easy to fix many years ago they didn't bother, and now that it will really hurt, they are too frightened....we are royally screwed as the Roman Centurions must have said as they waited for the collapse.

Posted by NoMoreBS 2014-09-20 13:52|| 2014-09-20 13:52|| Front Page Top

#19 The hole is now too deep to realistically dig out. Gutless Washington will do nothing but borrow and spend and wait until it all goes boom because there really aren't any other options.

The national debt is almost $18 trillion - more than the entire US generates in a year. It is just not realistic to think it will ever be paid back. There's a saying: when you owe the bank $1000, you have a problem. When you owe the bank $1,000,000, the bank has a problem.

IMHO, default and/or a currency collapse is basically inevitable, and I say: good. The sooner, the better. Yellen, Bernanke et al. have recklessly enabled the progressive agenda and the welfare state, which has done far more harm than good.

So when the Fed Chairsatan says "boost savings," I hear, "make sure you have a chair when the music stops."

Posted by RandomJD 2014-09-20 14:56|| 2014-09-20 14:56|| Front Page Top

#20 The political class is not going to do much to reduce taxes because that is their life blood. It is also the life blood of a very bloated bureaucracy. Look at how much the Tea Party threatens both parties when they call for economic and tax reforms.

Posted by JohnQC 2014-09-20 18:14|| 2014-09-20 18:14|| Front Page Top

#21 AND stop allowing banks to charge these idiot "use" fees to hold your money or use an ATM.

Government's job to pile on yet more regulation? Or our job, to find a more productive use for our funds?

The bank is charging you to let your money sit there idle, up to a balance of $5333, at which point you "break even."

For larger amounts, I'm sure they'd pay you the interest, since they're fleecing plenty of sub-$5333 folks.

But even then, it's still a net loss to keep any money in that account, due to the inflation rate, which is far higher than 1.35%. Each day your money sits there, it is literally declining in value.

You'd come out just the same, if you stashed it under a mattress, and gave a few bucks to a panhandler from time to time. Better, even, since gifting a bum with a bottle of Wild Irish Rose makes the world a better place than a donation to the banking cartel. Seriously. CDs and savings accounts are a total ripoff.

If you have debt, it is probably accruing interest at a rate far higher than 1.35% APR. You'd get more out of your rapidly devaluing cash by closing your savings account and paying off the debt.

Posted by RandomJD 2014-09-20 19:31|| 2014-09-20 19:31|| Front Page Top

#22 American's do need to save more money but it is entirely rational for them to save at the present tiny rate given the circumstances. Under the present conditions it is "spend it or it will lose lots of value". The average saver cannot compete with a government willing to print billions an then loan it out at less than 1%.

1) Government must stop printing money.
2) Government should not tax interest.
3) Government should not tax capital gains on none capital (i.e. first home, unimproved land, etc).
4) The should be a 100% tax deduction per individual on all medical expenses,insurance premiums and medical saving via HSA( this will strongly encourage savings ).
4a) Eliminate employer based health insurance and deregulate and allow interstate sales of insurance. (The above should largely do this as I don't think this should be done by regulation.)
5) Greatly expanded IRA type savings accounts and the amounts that a person may contribute.
6) Simply flat tax of say 15% with one personal deduction per member of family and the only other deductions are the two listed above.
7) Eliminate corporate taxes. This is a double taxation and strongly discourages the efficient use of capital investment. The individual already pays taxes on both capital gains and dividends. When corporation compete with tax free municipal bonds don't be surprised when you see $500 million dollar high schools.
8) Require the employer contribution to Social Security be listed on all pay-check stubs so employee really sees what they are paying in (just like self-employed people do). This will help people better understand what a rip-off SS is.

Most of these recommendations address savings and investment and I am leaving out a bunch that I have that don't address this.

Posted by Neville Guelph8168 2014-09-20 21:37|| 2014-09-20 21:37|| Front Page Top

#23 Regarding item 6) above. The individual deduction is arranged such that everyone (after health and and retirement deductions) who is above the "poverty line" pays at least some taxes. That is the best way to get the most people to understand that they don't get much value for the taxes they pay.

Posted by Neville Guelph8168 2014-09-20 21:44|| 2014-09-20 21:44|| Front Page Top

#24 No. Everyone should pay income tax. Everyone should have skin in the "game". And everyone should get a refundable tax credit, which replaces all the welfare programs.

Posted by KBK 2014-09-20 22:45|| 2014-09-20 22:45|| Front Page Top

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