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need to know
Disney's ESPN woes undercut 'Star Wars' gain
Pinterest hires Google exec as new ad chief
U.S. stocks end flat as oil continues to slide
SolarCity shares drop on soft forecast
Apple CEO Cook’s deleted Super Bowl tweet
Google CEO Pichai gets $199 million in stock
What to expect from Whole Foods earnings
Sears warns on sales, to speed up closures

The sad truth of why retirement
is a myth

Burberry sues, says J.C. Penney copied its designs

S.F. real estate looks like it did before dot-com crash
Every major city in the world, in one map

Americans quitting their jobs hit a nine-year high
NFIB survey hints wage gains are fleeting
Job openings are second highest on record

Recipe for less boring Oscar speeches

What to know before buying Beyoncé tickets

How to get mortgage approved: hope for sunny day

Can oil get so cheap that it won’t pay to extract it?
Oil sinks under $29 as EIA lowers price outlook
Barron’s Buzz: How low can the price of oil go?

99 Cent Gas May Be on Its Way
99-cents-a-gallon gas may be on its way: 24/7 Wall St.

Is the gold rally the real deal or ‘fool’s gold’?
Teen can keep $20,000 gold bar found in lake
Gold one of Wall Street’s best bets early in 2016
Gold futures stretch win streak to five sessions

Why is everyone freaking out about ‘CoCos’?
Convertible bonds are alluring as stocks fall
 
Deutsche Bank co-CEO says bank is ‘rock solid’
Deutsche may buy back billions in debt: FT
Why the selloff in European banks is ominous

This stock market has been Europe’s best in 2016

Strategists are arguing that stocks need a true purge

A strand of Lennon’s hair is selling for $12,000

White House forecasts decade-best economic growth
Obama proposes $4.1 trillion federal budget

Five questions that Janet Yellen must answer
Yellen may say goal is not to slow the economy
Fed: Too white, too male, too many bankers?
Expansion won’t die of old age: S.F. Fed study

Facebook, Amazon are the keys to tapping this market
French regulator threatens to fine Facebook
India bans Facebook’s free Internet service


Europe’s battles: migrants, ‘Brexit’ and ECB
German output, exports drop in December
Roubini: Welcome to the New Abnormal


This has been the No. 1 car in America for decades
How far can you get on $50 in gas?


/conga/frontpage.html 367529

Markets »

127.74MDow Volume:
Avg Vol: 130.29M
Unchanged
156
Decliners
4273
Advancers
2073
Price Chg %Chg 1 Day
Range: 1 Day
  • 1 Day
  • 5 Days
  • 1 Month
  • 3 Months
  • 6 Months
  • 1 Year
  • 2 Years
Dow
/quotes/zigman/627449/realtime 16,014 -13 0.08%
Nasdaq
/quotes/zigman/12633936/realtime 4,269 -15 0.35%
S&P 500
/quotes/zigman/3870025/realtime 1,852 -1 0.07%
GlobalDow
/quotes/zigman/629063/realtime 2,078 -7 0.32%
Gold
/quotes/zigman/33772884/delayed 1,191 -7 0.62%
Oil
/quotes/zigman/2260836/delayed 28.50 +0.56 2.00%
FTSE 100
/quotes/zigman/3173262/delayed 5,632 -57 1.00%
DAX
/quotes/zigman/2380246/delayed 8,879 -100 1.11%
CAC 40
/quotes/zigman/3173214/delayed 3,998 -69 1.69%
FTSE MIB
/quotes/zigman/1482176/delayed 15,913 -528 3.21%
IBEX 35
/quotes/zigman/2759620/delayed 7,928 -195 2.39%
Stoxx 600
/quotes/zigman/2380150/delayed 309 -5 1.58%
Asia Dow
/quotes/zigman/6959860/realtime 2,453 -18 0.73%
Nikkei 225
/quotes/zigman/5986735/delayed 15,733 -352 2.19%
Hang Seng
/quotes/zigman/2622475/delayed 19,288 +105 0.55%
Shanghai
/quotes/zigman/1859015/delayed 2,763 -18 0.63%
Sensex
/quotes/zigman/1652085/delayed 24,021 -266 1.10%
Singapore
/quotes/zigman/1709939/delayed 2,573 -50 1.91%
Euro
/quotes/zigman/16008136/realtime/sampled 1.13 0.00 0.04%
Yen
/quotes/zigman/16008150/realtime/sampled 114.79 -0.33 0.29%
Pound
/quotes/zigman/16008140/realtime/sampled 1.45 +0.00 0.03%
Australia$
/quotes/zigman/16008115/realtime/sampled 0.71 0.00 0.07%
DXY Index
/quotes/zigman/1652083/delayed 95.97 -0.08 0.09%
WSJ $ Idx
/quotes/zigman/41508961/realtime 89.26 -0.02 0.02%
U.S. 10yr
/quotes/zigman/15866666/realtime 1.71 -0.02 0.94%
German 10y
/quotes/zigman/15866409/realtime 0.24 0.00 0.00%
Italy 10yr
/quotes/zigman/15866497/realtime 1.68 0.00 0.00%
Spain 10yr
/quotes/zigman/15866444/realtime 1.79 0.00 0.00%
U.K. 10yr
/quotes/zigman/15866328/realtime 1.42 0.00 0.00%
Japan 10yr
/quotes/zigman/15866525/realtime 0.01 +0.04 161.23%
Crude Oil
/quotes/zigman/2260836/delayed 29 +1 2.00%
Gold
/quotes/zigman/33772884/delayed 1,191 -7 0.62%
Corn
/quotes/zigman/25518691/delayed 361 -1 0.14%
DJIA F
/quotes/zigman/48241424/delayed 15,900 -59 0.37%
S&P F
/quotes/zigman/43106711/delayed 1,843 -5 0.28%
Silver
/quotes/zigman/32655632/delayed 15 0 1.35%

Quotes

Symbol Price Change % Change
FB /quotes/zigman/9962609/composite 99.54 -0.21 -0.21%
AAPL /quotes/zigman/68270/composite 94.99 -0.02 -0.02%
GOOG /quotes/zigman/59527964/composite 678.11 -4.63 -0.68%
BAC /quotes/zigman/190927/composite 12.20 -0.07 -0.57%
C /quotes/zigman/5065548/composite 37.51 -0.30 -0.79%
F /quotes/zigman/264304/composite 11.35 -0.24 -2.07%
T /quotes/zigman/398198/composite 36.65 -0.46 -1.24%
BP /quotes/zigman/247026/composite 28.95 -0.97 -3.24%
GE /quotes/zigman/227468/composite 28.28 0.11 0.39%
Visit the quote page and your most recently viewed stocks will automatically be displayed here.
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Rates »

5 yr CD
1.3%
2 yr CD
0.7%
1 yr CD
0.5%
MMA $10K+
0.2%
MMA $50K+
0.4%

National averages from Bankrate.com

You Don’t Need Another Credit Card, You Need A Better One.
Avg. APR Last Week 6 Months
Low Interest 11.96% 11.88% 11.62%
Business 13.12% 13.11% 12.85%
Student 13.42% 13.42% 13.14%
Balance Transfer 14.35% 14.30% 14.12%
Airline 15.17% 15.16% 15.10%
Cash Back 15.26% 15.23% 15.27%
Reward 15.28% 15.25% 15.14%
Instant Approval 18.21% 18.18% 18.00%
Bad Credit 22.88% 22.88% 22.73%
Source:CreditCards.com

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Encore
A blog about living in and planning for retirement

A Real Debate on Taxes

In this year’s presidential campaign, the Republican candidates have made it very clear that increased revenue should play no part in the effort to restore fiscal balance.  As a result, all the balancing is accomplished through cuts to programs, including those that many retirees rely on, such as Medicare. Moreover, a recent analysis of Governor Romney’s tax proposals by the Urban-Brookings Tax Policy Center concludes that his revenue-neutral changes would provide large cuts to high-income households and raise taxes on middle- and lower-income households.

(For more on the implications of the two campaigns’ tax plans, see:  Romney vs. Obama on Taxes.)

Photo by Justin Sullivan/Getty Images

As described on Romney’s website, his tax plan would extend the 2001-03 tax cuts, reduce individual income tax rates by 20 percent, eliminate taxation of investment income for most taxpayers, eliminate the estate tax, reduce the corporate income tax rate, and repeal the alternative minimum tax and the high-income taxes enacted in the 2010 health-reform legislation. These changes would reduce revenue by about $450 billion in 2015. Governor Romney and his advisers say that the ultimate plan would include proposals to broaden the base by eliminating tax breaks and incentives so that his overall tax proposals would be revenue neutral.

Paul Ryan’s plan is quite similar. He calls for collapsing the income tax rates into brackets, 10 and 25 percent, which represents a cut in the highest marginal rate that’s even larger than is called for by the Romney plan. He also proposes making up the lost revenue by eliminating unspecified tax breaks.

Because the tax incentives to be eliminated are unspecified, the Tax Policy Center analysts needed to make some assumptions. First, consistent with statements by Romney and supporters, they assume that provisions to encourage saving — such as preferential rates on capital gains; tax preferences for retirement, health and educational savings accounts; exemption of interest on state and local bonds; the exclusion of capital gains in home sales; and the saver’s credit — would not be eliminated. Second, they eliminate tax breaks by “starting at the top.”  That is, they first eliminate tax benefits for the highest-income group (deductions for charitable contributions, mortgage interest and state and local taxes, and exclusions of health insurance and other fringe benefits from income) and then work their way down the income distribution until they have recouped all the revenue lost so that the tax cuts are revenue-neutral.

The key finding is that (once tax breaks to encourage saving are off the table) the total value of the tax breaks that these taxpayers are now enjoying (i.e., the amount that could potentially be eliminated under the proposed tax changes) is smaller than their gain from the rate cuts. As a result, the arithmetic requires that part of the burden for the high-income rate cuts shift onto middle- and low-income taxpayers. That is, once savings incentives are off the table, it is not possible to design a revenue-neutral plan that does not reduce tax burdens paid by high-income taxpayers, even if the reductions are implemented in the most progressive way possible.

As shown in the table, the after-tax income of those earning more than $1,000,000 would increase by 4 percent in this revenue-neutral exercise, while that of those with $75,000 to $100,000 would decline by 1.2 percent.

The fact that the existing tax system becomes more regressive under Romney’s tax proposals is interesting, but somewhat small potatoes compared with the fact that he and Paul Ryan envision no role for increased revenue in closing the fiscal gap. As a result, the entire burden falls on program cuts, which fundamentally affects the lives of low- and middle-income families. Now, that is something to have a debate about!

 

Comments

We welcome thoughtful comments from readers. Please comply with our guidelines. Our blogs do not require the use of your real name.

Comments (5 of 16)

View all Comments »
    • Regardless of how news sites try to dress it up as “unfair,” reducing our national debt will have to come from curtailing programs that are targeted at the middle and lower class.

      It isn’t being proposed to be punitive to the middle and lower class, it is just reality. Those programs have to spend less because, as Sutton pointed out, “That’s where the money is.”

      -Dan

    • No Republican candidate has EVER said, “increased revenue should play no part in the effort to restore fiscal balance”.

      What they have said, the point generally missed by cub reporters, is that revenues increase when the economy improves. And if government spending increases slower than the economy, the budget will balance itself. That is the main point of the Ryan budget.

      Of course, this President’s plan has deficits projected for the next 75 years. That’s right, 75 years. Did Mr. Obama bother checking with your grandchildren before spending their money?

    • So George,

      No mention of George Soros? hmm…

    • This is just a continuation of the income redistribution plan that has been in place since at least the early 90s. Look at the IRS website and find the tables for those taxpayers with the top 400 incomes. In the 90s they paid close to a 30% effective rate (the actual % of their income paid in taxes). Now it’s about half that. Has the average middle class taxpayer seen that kind of decrease in their effective rate? No way. It’s all a shell game designed to try to deceive the average voter.

      Then look at the “don’t tax the job creators myth”. As an example, take the Koch brothers who should be the biggest job creators of all! Certainly they are part of the 400 as they are the 4th and 5th richest Americans. In 2007 they employed 80,000 people and were worth 37 billion dollars. Of course they have been replacing people with automation and outsourcing jobs overseas. Now they have less than 60,000 employees and have 50 billion dollars. Just how many more billions of dollars do we have to give the Koch brothers to get them to hire someone? Not going to happen. Don’t get me wrong I don’t think it should, market pressures and technological progress will and should dictate their business actions. What is wrong is for those two people to spend 400 million dollars this year to dupe people into believing that reducing their taxes and letting them pollute more is going to lead them to hire more people.

      I don’t have a problem with anyone making lots of money, what I do have a problem with is them using it to misinform, twist the truth, confuse people and in general usurp the democratic process. I guess we are just lucky the Kochs did not get their way. What’s that? Paul Ryan, Newt Gingrich, Rick Santorum,and Rick Perry were really playing to the Koch money. They all want to completely eliminate capital gains taxes! Hooray, Romney’s taxes would go to less than 1%. Oh well, maybe they’ll get their wish next time! Have to find a different candidate though or it will look too self-serving.

      p.s. Alan, read the study the authors referenced. They did consider revenue increases due to tax cuts. Also, note that Paul Ryan and most of the primary candidates want to eliminate capitals gains taxes, so if they ultimately want to get their way you won’t see any of your capital gains tax revenue increases.

    • Don’t kid yourself. With either candidate there will be entitlement cuts. We’re broke people.

About Encore

  • Encore examines the changing nature of retirement, from new rules and guidelines for financial security to the shifting identities and priorities of today’s retirees. The blog also explores news that affects retirement, from the Wall Street Journal Digital Network and around the web. Lead bloggers are reporter Catey Hill and senior editor Jeremy Olshan. Other contributors include The Wall Street Journal’s retirement columnists Glenn Ruffenach and Anne Tergesen; the Director for the Center for Retirement Research at Boston College, Alicia Munnell; and the Director of Research for Pinnacle Advisory Group, Michael Kitces, CFP.

MarketWatch - Stock Market Quotes, Business News, Financial News
Bulletin
Investor Alert

Tokyo Markets Close in:

need to know
Disney's ESPN woes undercut 'Star Wars' gain
Pinterest hires Google exec as new ad chief
U.S. stocks end flat as oil continues to slide
SolarCity shares drop on soft forecast
Apple CEO Cook’s deleted Super Bowl tweet
Google CEO Pichai gets $199 million in stock
What to expect from Whole Foods earnings
Sears warns on sales, to speed up closures

The sad truth of why retirement
is a myth

Burberry sues, says J.C. Penney copied its designs

S.F. real estate looks like it did before dot-com crash
Every major city in the world, in one map

Americans quitting their jobs hit a nine-year high
NFIB survey hints wage gains are fleeting
Job openings are second highest on record

Recipe for less boring Oscar speeches

What to know before buying Beyoncé tickets

How to get mortgage approved: hope for sunny day

Can oil get so cheap that it won’t pay to extract it?
Oil sinks under $29 as EIA lowers price outlook
Barron’s Buzz: How low can the price of oil go?

99 Cent Gas May Be on Its Way
99-cents-a-gallon gas may be on its way: 24/7 Wall St.

Is the gold rally the real deal or ‘fool’s gold’?
Teen can keep $20,000 gold bar found in lake
Gold one of Wall Street’s best bets early in 2016
Gold futures stretch win streak to five sessions

Why is everyone freaking out about ‘CoCos’?
Convertible bonds are alluring as stocks fall
 
Deutsche Bank co-CEO says bank is ‘rock solid’
Deutsche may buy back billions in debt: FT
Why the selloff in European banks is ominous

This stock market has been Europe’s best in 2016

Strategists are arguing that stocks need a true purge

A strand of Lennon’s hair is selling for $12,000

White House forecasts decade-best economic growth
Obama proposes $4.1 trillion federal budget

Five questions that Janet Yellen must answer
Yellen may say goal is not to slow the economy
Fed: Too white, too male, too many bankers?
Expansion won’t die of old age: S.F. Fed study

Facebook, Amazon are the keys to tapping this market
French regulator threatens to fine Facebook
India bans Facebook’s free Internet service


Europe’s battles: migrants, ‘Brexit’ and ECB
German output, exports drop in December
Roubini: Welcome to the New Abnormal


This has been the No. 1 car in America for decades
How far can you get on $50 in gas?


/conga/frontpage.html 367529

Markets »

127.74MDow Volume:
Avg Vol: 130.29M
Unchanged
156
Decliners
4273
Advancers
2073
Price Chg %Chg 1 Day
Range: 1 Day
  • 1 Day
  • 5 Days
  • 1 Month
  • 3 Months
  • 6 Months
  • 1 Year
  • 2 Years
Dow
/quotes/zigman/627449/realtime 16,014 -13 0.08%
Nasdaq
/quotes/zigman/12633936/realtime 4,269 -15 0.35%
S&P 500
/quotes/zigman/3870025/realtime 1,852 -1 0.07%
GlobalDow
/quotes/zigman/629063/realtime 2,078 -7 0.32%
Gold
/quotes/zigman/33772884/delayed 1,191 -7 0.62%
Oil
/quotes/zigman/2260836/delayed 28.50 +0.56 2.00%
FTSE 100
/quotes/zigman/3173262/delayed 5,632 -57 1.00%
DAX
/quotes/zigman/2380246/delayed 8,879 -100 1.11%
CAC 40
/quotes/zigman/3173214/delayed 3,998 -69 1.69%
FTSE MIB
/quotes/zigman/1482176/delayed 15,913 -528 3.21%
IBEX 35
/quotes/zigman/2759620/delayed 7,928 -195 2.39%
Stoxx 600
/quotes/zigman/2380150/delayed 309 -5 1.58%
Asia Dow
/quotes/zigman/6959860/realtime 2,453 -18 0.71%
Nikkei 225
/quotes/zigman/5986735/delayed 15,735 -350 2.18%
Hang Seng
/quotes/zigman/2622475/delayed 19,288 +105 0.55%
Shanghai
/quotes/zigman/1859015/delayed 2,763 -18 0.63%
Sensex
/quotes/zigman/1652085/delayed 24,021 -266 1.10%
Singapore
/quotes/zigman/1709939/delayed 2,575 -48 1.85%
Euro
/quotes/zigman/16008136/realtime/sampled 1.13 0.00 0.04%
Yen
/quotes/zigman/16008150/realtime/sampled 114.78 -0.34 0.29%
Pound
/quotes/zigman/16008140/realtime/sampled 1.45 +0.00 0.01%
Australia$
/quotes/zigman/16008115/realtime/sampled 0.71 0.00 0.08%
DXY Index
/quotes/zigman/1652083/delayed 95.98 -0.08 0.08%
WSJ $ Idx
/quotes/zigman/41508961/realtime 89.26 -0.02 0.02%
U.S. 10yr
/quotes/zigman/15866666/realtime 1.71 -0.02 0.94%
German 10y
/quotes/zigman/15866409/realtime 0.24 0.00 0.00%
Italy 10yr
/quotes/zigman/15866497/realtime 1.68 0.00 0.00%
Spain 10yr
/quotes/zigman/15866444/realtime 1.79 0.00 0.00%
U.K. 10yr
/quotes/zigman/15866328/realtime 1.42 0.00 0.00%
Japan 10yr
/quotes/zigman/15866525/realtime 0.01 +0.04 161.23%
Crude Oil
/quotes/zigman/2260836/delayed 29 +1 2.00%
Gold
/quotes/zigman/33772884/delayed 1,191 -7 0.62%
Corn
/quotes/zigman/25518691/delayed 361 -1 0.14%
DJIA F
/quotes/zigman/48241424/delayed 15,901 -58 0.36%
S&P F
/quotes/zigman/43106711/delayed 1,843 -6 0.30%
Silver
/quotes/zigman/32655632/delayed 15 0 1.35%

Quotes

Symbol Price Change % Change
FB /quotes/zigman/9962609/composite 99.54 -0.21 -0.21%
AAPL /quotes/zigman/68270/composite 94.99 -0.02 -0.02%
GOOG /quotes/zigman/59527964/composite 678.11 -4.63 -0.68%
BAC /quotes/zigman/190927/composite 12.20 -0.07 -0.57%
C /quotes/zigman/5065548/composite 37.51 -0.30 -0.79%
F /quotes/zigman/264304/composite 11.35 -0.24 -2.07%
T /quotes/zigman/398198/composite 36.65 -0.46 -1.24%
BP /quotes/zigman/247026/composite 28.95 -0.97 -3.24%
GE /quotes/zigman/227468/composite 28.28 0.11 0.39%
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Rates »

5 yr CD
1.3%
2 yr CD
0.7%
1 yr CD
0.5%
MMA $10K+
0.2%
MMA $50K+
0.4%

National averages from Bankrate.com

You Don’t Need Another Credit Card, You Need A Better One.
Avg. APR Last Week 6 Months
Low Interest 11.96% 11.88% 11.62%
Business 13.12% 13.11% 12.85%
Student 13.42% 13.42% 13.14%
Balance Transfer 14.35% 14.30% 14.12%
Airline 15.17% 15.16% 15.10%
Cash Back 15.26% 15.23% 15.27%
Reward 15.28% 15.25% 15.14%
Instant Approval 18.21% 18.18% 18.00%
Bad Credit 22.88% 22.88% 22.73%
Source:CreditCards.com

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