1) Why Wall Street Likes LinkedIn More Than Facebook (Forbes) - I posted this one just for Patrick.
2) Bypassing Wall Street (AVC) - Fred Wilson writes about what I've long suspected: Wall Street has done so much to damage the integrity of the stock market since 2007 that many astute investors will no longer touch stocks. Knight Capital's screw-up only highlights the vulnerabilities that exist in the public markets today, and also why alternative investments are looking better and better. It's hard to argue with the 13.74% I'm getting on my Lending Club account.
3) Should the U.S. Have a Maximum Income? (No.) (The Atlantic) - There is a lot of chatter in France right now about all things taxation. The new government is pushing a 75% tax on any income over a million Euro a year, and some are even proposing a maximum income (so a 100% tax above a certain level). Would that fly in the States?
4) I, Too, Have Messed with LIBOR (Boston Review) - The latest from our old pal Omer Rosen about more shenanigans at the Citibank of old.
5) How to clean the banking cesspit (Reuters) - Some interesting ideas here, moreso because the author takes the conventional wisdom about how to fix Wall Street and points out where it's wrong. The section on executive compensation is especially poignant.
6) Save your way to $1 million (CNN Money) - Good personal finance piece on how to get that first million socked away. This will be old hat to some of the more experienced guys on WSO, but the younger guys can definitely benefit from it.
7) World’s Oldest Shipping Company Closes In Industry Slide (Bloomberg) - I know a lot of you are interested in the shipping industry, and this is pretty significant news. Stephenson Clarke has been around since 1730 and they just shut down. Hard to imagine that they saw something after nearly 300 years in business that they didn't think they could overcome.
8) The Company Man’s Guide to Starting a Side Hustle — Part II: Think Big, Act Small (Art of Manliness) - You guys know I'm big on diversifying your income streams. This is a good nuts-and-bolts article about starting a small side gig. You'll notice it's Part 2 of two, and you should definitely read part one as well, but this one is the meat and potatoes.
9) Jets' Sanchez reveals how he muscled up for his biggest challenge (NY Post) - Somebody got swole over the summer. Guess he's hearing footsteps. Call me naive, but isn't staying in shape part of the job?
10) Check Out The Debauchery When Applebee's Turns Into 'Club Applebee's' After 10 PM (Business Insider) - This is just fucking awesome. Who knew this shit went on at Appleby's? I have to admit when I first saw this all I could think about was Owen Wilson in Hall Pass. But if these photos are legit, Appleby's could be the next 1Oak.
Video of the Week:
Richard Fisher, president of the Dallas Federal Reserve Bank, has a pretty sobering view when it comes to additional quantitative easing: it won't work. He says the Fed has already done all they can and, to use his analogy, the gas tank is full and now someone needs to figure out how to engage the transmission. He says more quantitative easing is akin to "pushing on a string". Sound like me trying to get lucky after a pint of scotch.
Monetary ritalin indeed.
Anyway, let me know what you guys think about this week's Bananas in the comments and have a fantastic weekend!
Thumbs up, got most of these on deck to read during the day
Richard Fisher deserves a medal!
Also, LinkedIn manages market expectations better than Facebook and, as the article discussed, there is a value in predictability. Still, I believe both LinkedIn and Facebook to be wildly overvalued.
I've been reading about this proposed French tax rate. Apparently it would impact only about 30,000 people out of 62 million. Of course, the problem is, in the very best case, it will raise revenues something like 1%. Basically, this means that the marginal benefit of increased revenues is essentially a rounding error, while the negative impacts (the wealthy leaving, foreign investment fleeing, tax evasion/tax avoidance, etc.) could be substantial.
It reminds me of how Barack Obama admitted in 2008 that he believed it was irrelevant if raising the capital gains tax would actually lower revenues because it was about "fairness". When politicians ignore the purpose of the tax code--raising revenue for the general use of the public--and input their political philosophy into what is otherwise basic mathematics, you've got a real issue with the direction of that country. I don't believe the purpose of the tax code is to create "fairness" with no tangible benefit to the public. That someone else is less wealthy is no benefit to me.
Not saying it's a good idea. Just saying that WSO could really use a dose of anti-shrillness when it comes to politics. We need to learn to grit our teeth and start educating when Dems say something dumb rather than shout "socialist!"
I can't believe how many times this needs to be repeated to you--when adjusting for inflation, those millionaire taxes never hit anyone but the super, super rich. $1 million per year pre-promise based currency was way, way, way more than it is today, plus a much greater relative and absolute number of people are rich today than they were a half century ago. I'm so sick of this argument that those tax rates used to work. No, no they didn't. They didn't work then, which John Kennedy realized, and they aren't remotely comparable to today's numbers.
http://www.westegg.com/inflation/
$1 million in 1960 is equivalent to $7,287,000 in 2010. We aren't even in the same stratosphere of comparison.
"One way of silently lessening the inequality of property is to exempt all from taxation below a certain point, and to tax the higher portions of property in geometrical progression as they rise."
A 100% tax is stupid though and will not fly here. I fail to see why people can't/won't take a balanced perspective.
TJ is dead, so fuck him. If he was actually smart he would have figured out how to not die, so his argument has no credibility. Right?
I'm buying credits to give you a SB, great links this wk.
Looks like that girl has a Gene Simmons tongue. Applebee's, who knew?
If you're a consultant staffed on a project in the middle of nowhere, you know about Club Apple.
Still think FB is overvalued - Long LinkedIn all day.
Richard Fisher,
I like that guy.
Of course. But we did impose an earnings cap around $36.4 million ($5 million x 628% inflation + 100%) back in the '50s. At some point, we did limit incomes.
Regardless, my post was largely for people like you and Abdel. Life and politics is about compromising between what you think is just and what the folks on the other side of the table think is fair, often based off of the facts on the ground.
The facts on the ground today are different than they were in 1979. Just sayin'. We have rich people who don't think they're taxed enough and we have a country going bankrupt largely on entitlement obligations and military spending rather than discretionary stuff.
If you confiscated the entire wealth of the top 1% of tax payers, it wouldn't cover 1 year of our fiscal DEFICIT. Punitive taxes on the rich serves absolutely no purpose other than to make left-wing socialists feel good about themselves. Why make our nation less competitive economically to appease socialists in a capitalist nation?
The entire wealth of the top 1% is roughly $20 Trillion. (The wealth distribution in the country is 1/3 top 1%, 1/3 next 9%, 1/3 bottom 90%) This is trillions more than our debt.
I think that as the medicaid and WIC cuts continue to hit the poor; as the cuts to the state universities hurt the middle-class; the least we can do at the federal level is end the Bush tax cuts (for everyone) to show folks we consider this both a spending problem and revenue problem. The suffering isn't quite as bad if you know other folks are getting hurt with you. Call it sour grapes if you like; most folks would call it "everyone's in the same boat."
A lot of folks in the ultra-wealthy are advocating a tax hike. 90% taxes aren't the solution, but maybe 40% federal taxes are. This is lower than Reagan's top rate of 50%.
I was wondering how long it would take for you to march out the right's favorite straw man argument on taxes.
10) Damn it, anyone else notice that of the ~30 applebees that partake in that program, 100% of them are in florida- fml.
9) Jets fan here. If Tebow isnt starting by week 8 I may make a seasonal switch to my number 2, texans. Just for Cushing (he and ray rice are the only nfl players i had the honor of playing in h.s.- yes you can tell whos going to the nfl at the h.s. level and yes cushing snacked on roids like it was a multi-vitamin) 3) I'm all for a 100% marginal tax rate, at say what? 350k? I'm all about finding an excuse to bail on this "ambition" bullshit once and for all. That would most certainly do it, lol.
Can you share how you're getting those kinds of returns on lending club?
ew mark sanchize
Christ! This has turned political fast and hard (no snickering).
I'd only agree to go back to Clinton era tax rates if we also agree to go back to Clinton era spending. A major reason people are fed up with talk of raising taxes on anyone is they know that money wouldn't go to reducing the deficit. It would go to more spending programs.
We just don't have enough people in the highest tax bracket to make a dent in the deficit. Per the IRS website, http://www.irs.gov/taxstats/indtaxstats/article/0,,id=133521,00.html "Table 3.5 Returns with Modified Taxable Income: Tax Generated, by Rate and by Size of Adjusted Gross Income, Tax Year 2009", the last year they did this kind of analysis, there is $485B subjected to the highest rate of 35%. So this yields $169.7B in revenue.
If we decided to forgo Clinton era 39.6% rates and went straight to, say 50%, that would still only yield an additional $72.8B in revenue. A drop in the bucket. Oh and just for fun if we raised the highest tax bracket to 100% that would only give us $288.3B in additional revenue. Close to our $1,100B 2012 deficit? Nope.
We can't tax the rich enough to dig our way to out of our National Debt. The real money is in the middle class. And no one is going to go there... Well, maybe one ideology would like to. Not mine.
I'm not going to argue for any policy, but I hate seeing the "it's only a drop in the bucket" argument being used. Almost every cent counts.
Sure, focusing on things like foreign aid spending is mostly a waste of time, but the fact is our problems are related to both spending and revenue. We won't achieve much by ignoring one or the other. We aren't going to solve our problems looking for a silver bullet that magically cuts the deficit in half while leaving everyone happy.
The worst of all, no politician today has the leadership, and most importantly, courage to call for the vast reforms needed, especially in regard to the entitlement programs.
I think we're due for an annual report on the WSO Lending Club CDO, I completely forgot about that thing, lol.
Yeah, you guys are right, I'm about due to write another Lending Club update. I'll get it done in the next two weeks.
Also, this thread is making me think I should revisit my idea for re-writing the estate tax. Since wealth is where all the money is, and people who inherit wealth are generally douchebags, I propose a 100% estate tax on estates over $1 million on a per stirpes basis (in other words, if someone has three direct heirs - living or deceased - their estate would be exempt to $3 million).
However, my plan would allow for a full 2nd generation exemption. So if you created an enormous estate from scratch (a la Bill Gates, Steve Jobs, Larry Ellison, etc) your estate passes to your designated heirs 100% tax free. Subsequent generations would be taxed according to the above parameters. So if you make a fortune, you can pass it all on to your kids but future generations would have no claim (except for the $1 million per stirpes).
What do you guys think?
EDIT: I had a longer post, but it's Friday. Screw it, I'm going to the bar.
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