BIDEN AND THE DEMOCRAT PARTY REVEAL A VAST IGNORANCE OF FINANCE AND ACCOUNTING

 

President Joe Biden, Senator Ron Wyden, and other members of the Democrat Party have made the headlines again, but many people will not understand this particular issue, this includes many of the so called "business experts" in the press; therefore a brief explanation may be required for some readers. The headline from many news articles reads as follows: "Biden backs tax on billionaires' unrealized investment gains". 

 

This should frighten anyone that has ever invested in stocks, mutual funds, business partnerships, certain types of real estate investments, certain insurance annuities, or collectable items such as stamps, coins, comic books, etc.

 

When an individual invests money in something hoping to get a positive return on that investment, there can only be two possible outcomes: either a gain or a loss. For example: Chris invests some money, $10,000, into a company's stock that is listed on the New York Stock Exchange. Chris purchased 100 shares of XYZ corporation at $10 per share. Until the moment that Chris sells that stock investment he has not gained or lost anything, because he still owns that stock and the price could change at any point in time. According to the rules of accounting, any business or individual that issues yearly financial statements must declare their unrealized gains or losses. An unrealized gain or loss is  the change in the price of an investment that occurs before that investment is sold; it is a "paper" gain or loss, because the investor has not gained or lost anything as of yet. In the example above, Chris bought 100 of XYZ corporation at $10 per share. If the price of that stock goes to $11 per share, but Chris does not sell it, it becomes an unrealized gain. If the price was to drop to $9 per share, but Chris does not sell it, it becomes an unrealized loss. 

 

The above scenario could be applied to a stamp or comic book collection. If a person buys a rare comic book valued at $1000, and it increases in value to $2000, under this proposed new tax the comic book owner would be required to pay a tax on the increase in value of the comic book; regardless if the comic book was sold or not. 

There are several questions about President Biden's idea that everyone should be asking. 

1. Is this an income tax or a property tax?   Income tax is based upon the net amount of income or profit a taxpayer realizes by the end of the year. Property tax is based upon an individual owning something of value: a house, a car, etc. This new tax seems to be an insanely confused hybrid of the two. People will get taxed for owning something that has increased in value on paper, but the owner has not earned even one cent in actual profit. 
2. Will the taxpayers be allowed to use unrealized losses as offset to their unrealized gains?  This is very simple, an investor will win some and lose some. Historically speaking, any tax on gains or profits a taxpayer realizes throughout the year can be reduced by the amount of losses they realized. 
3. How will this tax be calculated?  A company's stock price can change faster than the wind. 
4. If the taxpayer being taxed for unrealized gains eventually sells the stock for a loss, will the taxpayer be able to recover the taxes he paid on the unrealized gains?
   

The US Tax Code is based upon the rules of accounting, known as GAAP  or Generally Accepted Accounting Practices, and very fortunately for the American taxpayers, there still remain some folks in DC that understand how these things are supposed to work. This proposed new tax violates all sorts of long held principles, rules that are essential for the smooth functioning of economic transactions. Senator Ron Wyden, being the Chairman of the Senate Finance Committee, should know very well that taxing unrealized gains and losses will lead to a disaster of epic proportions. Why would anyone wish to invest in the Stock Market, in real estate, or even in collectable goods, if they are faced with an income tax every time their investment changes in value??

 

This proposed new tax has gone beyond the point of being ridiculous or silly, to the point at which we must question the sanity of the folks that are supporting this. 

THE NEW YORK TIMES CALLS THE AMERICAN FLAG "DISGUSTING" AND ALIENATING TO SOME

 

Socialist/Progressive commentators at the New York Times have decided the American flag is a symbol of hatred and racism, and is alienating and disgusting. We should not be surprised at the vitriol being used when describing the symbols of our nation.

The attack on Confederate statues and symbols was just a warmup, all American symbols are targeted for destruction. This hate for American symbols is easy to understand, if someone is able to view history through a Marxist perspective. Karl Marx believed all of history was the story of one group dominating another. He called these groups the bourgeoisie (the haves) and the proletariat (the have not). The bourgeoisie being the ruling class that controlled politics and owned the means of production, while the proletariat was the laboring class that sold their services for wages.

If we take the writings of Karl Marx and replace the term "bourgeoisie" with the vague terms "white people or Western civilization". and replace the term "proletariat" with the term "minority people", we can discover the intellectual foundation upon which the Socialist/Progressive Left is founded upon. The arguments being made by the Left of the Democrat Party, the goal of the BLM organization, and ideas being espoused by the media and academia suddenly become clear, they are taken directly from Karl Marx. In other words, the attack on American symbols and history, the term "white privilege", and every other aspect of political correctness are all the product of Marxist ideology. These ideas have gained the support of a large percentage of the voting public, innocent citizens have been duped into accepting a terrible form of tyranny which their fathers and grandfathers had fought a Cold War to contain.

Technical trouble

 Dear Readers,

Apologies for the reloading of the most recent post. There seems to be some sort of glitch or bug in the software that is causing my uploads to fail.

A CONCERT FOR THE AGES

 

Roy Orbison sings "Pretty Woman", backed by a group of legendary musicians.

 

I recently discovered this hidden gem: a Roy Orbison concert from 1987, the Rock and Roll legend put forth an awesome history making performance. As added bonus, the great Rock and Roller had a supporting crew of other legendary performers as backup singers and guitarists: Bruce Springsteen, Jackson Browne, T Bone Burnett, Elvis Costello, Tom Waits, Bonnie Raitt, Jennifer Warnes, James Burton, and k.d. lang. This awesome bunch of musicians have earned more than 60 Grammy Awards, with Orbison having earned five. 

 Orbison was inducted to the Rock and Roll Hall of Fame in 1987 by Bruce Springsteen, who said "I wanted a record with words like Bob Dylan that sounded like Phil Spector—but, most of all, I wanted to sing like Roy Orbison. Now, everyone knows that no one sings like Roy Orbison." As a result, Orbison said he felt validated by this honor, and asked Springsteen for a copy of his speech. Having established a certain bond of mutual respect, the two of them paired up with the other great performers listed above, and put on a memorable performance. Orbison was humbled by the display of support of so many great names, and k.d. lang quoted him as saying "If there is anything I can ever do for you, please call on me"

 

Roy Orbison and Bruce Springsteen sing in harmony

 

The female chorus group, each of the ladies is an accomplished musician.

 

 

 

INSANITY IN OUR TIMES

 

The look of lunacy

Society has gone insane, every sort of aberration, abomination, perversion, eccentricity, or insanity, has now gone mainstream and is accepted by pop culture. It would take far too long to list every bit of craziness found in the recent news; therefore, I have listed a few stellar examples.

 

For our first example, a heroin addicted Columbia university professor has declared that drug usage should be a legalized human right. We must assume the man knows what he's talking about, he teaches at one of the most prestigious universities in world. Perhaps this stunt is intended to boost sales of his book, or perhaps he really believes his own craziness. It's easy to imagine the catastrophic results if the government was to suddenly legalize hardcore drug use, there would be an epidemic of addiction, overdoses, suicides, and different forms mental illness resulting from extended drug use. Perhaps the university should reconsider the quality of the professors it hires, and search for faculty that would not poison the students. 

In another bit of news from New York City, a teacher preparing to retire was fired for refusing to give the "Black Panther" salute to the school superintendent. The teacher, a Dominican-American who identifies as Afro-Latina, was one year away from retirement, and is now suing the school board for unlawful termination. Apparently, the school board adopted the salute from the Disney/Marvel film "Black Panther" in which the actors give the salute and shout "Wakanda Forever!". The teacher was admonished multiple times for not using this particular salute. I wonder if other forms of salute will become mandatory in the public school system, perhaps the straight hand Nazi salute, or the Roman salute in which soldiers and gladiators would bang their fist against their breastplate. The lawsuit also claims the teacher was informed she was "not black enough" and to "sit quiet and look pretty". Well, well.... if anyone except a black person had made such comments, the offender would be beaten to death by an angry mob, while liberal politicians and journalists would declare the violence to be a cathartic act of societal cleansing. The fired teacher is suing the school system for $40Million, and I hope she wins. 

I was going to avoid politics, but President Joe Biden deserves a bit of help. He simply can not do enough to appease the fanatical Socialist/Progressive Left of the Democrat Party that keeps hounding him to take ever more extreme positions on everything from the minimum wage to the deportation of illegal immigrants. The ACLU has declared the Biden administration's guidance on deportations a "step backwards".  Self-proclaimed Communist Bernie Sanders, the chairman of the Senate Budget Committee, is assuring people that a national $15 per hour minimum wage will become a reality. Biden, with whatever wisdom remains to him, has rejected to idea of raising the minimum wage in such a dramatic fashion, declaring it would be harmful to businesses, the economy, and the labor market. 

 

In order to avoid to great a fight within the ranks of the Democrat Party, Biden could realistically place the blame for all these problems on Donald Trump. Why not? The man was hounded for four years, with every sort of specious accusation being hurled against him. Journalists would happily oblige by digging up nonexistent dirt given to them by confidential sources, claiming Trump has been masterminding everything by his use of social media; regardless if it is an impossibility. The voters will believe it, and that's all that matters to the Democrat Party. 

 

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Communist Bernie Sanders, he is known to have an acerbic personality.