Economic Recovery for the Few

[Donnachaidh]

http://www.truth-out.org/economic-recovery-few61906

Where is this elusive recovery? The banks, some say, have "recovered." Yet they remain dependent on Washington, they do not make the loans needed for a general recovery, and many medium and small banks keep collapsing. The stock market shows no recovery. The Dow index was 14,000 in late 2007 when capitalism hit the fan, and it is around 10,000 now. The Nasdaq market index was 2800 then and is 2300 now. Everywhere else -- unemployment, foreclosures, bankruptcies, depressed housing market, and so on -- no recovery in sight. Yet, my search finally found genuine recovery for one group, and its recovery offers a better policy to treat this crisis.

Every year, two major companies catering to rich investors co-author a survey of their clients. Capgemini and Merrill Lynch Wealth Management's World Wealth Report covers the two groups that interest them: High Net Worth Individuals (HNWIs) and Ultra-High Net Worth Individuals (Ultra-HNWIs). The first group counts all individuals with at least $1 million of "investible assets" in addition to the values of their primary residence, art works, collectibles, etc. The second group includes individuals with at least $30 million of such investible assets.

Their latest Report, covering the year 2009, finds 10 million HNWIs in the world that year: 3.1 million in North America, while Europe and Asia-Pacific each had 3.0 million. The rest of the world had a mere 0.9 million of the rich and richer.

The 10 million HNWIs -- in a global population of 6.8 billion in 2009 -- amounted to 0.14 per cent of the earth's people. Together, they owned a total of $39 trillion in "investible assets." To see what this means: in 2009, the US GDP (total output of goods and services) was $14.6 trillion. The combined GDPs of the world's 9 richest countries (US, Japan, China, Germany, France, UK, Italy, Russia, and Spain) totaled less in 2009 than the investible assets of the world's HNWIs.


MUCH more at the link ---

[w8liftinglady]

1. thanks for sharing....k/r

[pinto]

2. Winners and Losers Under Obama’s New Tax Plan (via Darwin's Finance)

Winners

Making Work Pay tax credit - $400 for individuals, $800 for a couple filing jointly through 2011. This was already in place for 2009, 2010.

Middle Class Income Taxes – Extending the tax cuts enacted under Bush for families making less than $250,000 and individuals making less than $200,000.

Hiring Businesses – Budget would give companies a $5,000 tax credit for each new worker they hire in 2010. Businesses that increase wages or hours for their current workers in 2010 would be reimbursed for the extra Social Security payroll taxes they would pay. I question how helpful the second part is. Would this just make companies rethink a new hire since they could employ overtime for less money now? Some new hire decisions on the fringe may suffer.

Research Outfits – Make the research and experimentation tax credit permanent, saving businesses about $83 billion over the next decade.

Business Capital Outlays – Extend a provision allowing businesses buying equipment such as computers to accelerate depreciation through 2010, saving them $20 billion over the next decade.

Losers

High Income Earners – Raise the top two income tax rates for individuals, from 33 percent and 35 percent, to 36 percent and 39.6 percent, respectively. Result: nearly $1 trillion in higher taxes on couples making more than $250,000 and individuals making more than $200,000 by not renewing Bush-era tax cuts for them.

Investors - Increase the top capital gains tax rate from 15 percent to 20 percent for families making more than $250,000 a year and individuals making more than $200,000. This may have a gradual impact on stock market returns. With a higher capital gains rate, high net worth investors may shift to other assets with a more desirable net return profile.

Oil and Gas Companies & Multinationals - Increase taxes on U.S. companies with major overseas operations, and plans to increase taxes on oil and gas companies to the tune of about $39 Billion over the next decade. Also, restrict the ability of international companies to defer taxes on profits made overseas, raising about $26 billion over the next decade.

Charities – Since many charities rely on contributions from high income earners, the new limit on itemized tax deductions high earners can claim for charitable donations, mortgage interest and state and local taxes, will likely hurt.

Banks/Financials - Enact a “financial crisis responsibility fee” on large firms that may be “too big to fail”, raising $90 billion over the next decade.

Fund Managers – Change the way profits by investment fund managers are taxed, raising an additional $24 billion over the next decade.

http://www.darwinsfinance.com/obama-tax-budget/

[laughingliberal]

3. Greenspan said as much on MTP. There has only been recovery in a small segment, he said.

He was referring, of course, to those at the top. Rather shocking to hear it from him.

[eilen]

4. I wonder if he has cancer or something

and feels the need to tell the truth and try and avoid eternal damnation.