Maryland's Millionaire Tax Dodgers

And you're BOASTING about it? Really? After being asked to pay their fair share:

One-third of the millionaires have disappeared from Maryland tax rolls. In 2008 roughly 3,000 million-dollar income tax returns were filed by the end of April. This year there were 2,000, which the state comptroller's office concedes is a "substantial decline." On those missing returns, the government collects 6.25% of nothing.

If the underlying contention of such notions is accurate, the writer is suggesting that because the wealthiest were required to pay their fair share, THEY DODGED THEIR LEGAL OBLIGATION.

And this tax dodging is somehow both predictable and laudable?!

Somebody needs to go look up the term Fail Whale as pop cultural indictment of all things moronic and laughable.

Arbitrary and Emotional - Hallmarks of Capitalism

Pricing Deals with charts, graphs, and the absurd voodoo of the 52 Week High. The Wall Street Journal:

In other words, boards and bankers are just like the rest of us. They set aside their rational mind in favor of those anchors -- arbitrary and emotional points of concentration.

You don't need Goldman Sachs to do this math. Dr. Phil will probably do the trick.

Given, of course, the perfect symmetric information of economic mythology 101. So efficient. So impartial. Such an unbiased meritocracy. No room for foundational, existential restructuring here.

Snark and Anger at Las Magus

Alchemists have always been a sham and a farce. Financial alchemists -- las magus, to abuse both poetic license and spanglish -- are the bottom of the barrel of the breed.

Which leads to our question, have you ever wondered why the tone in this blog, along with growing numbers of others, is increasingly snarky and angry at the very core of free market capitalist convention? Why is Free Market Socialism emerging as the most likely, most credible evolutionary step forward, from here?

Obviously, both ideologies hold Free, Fair, Open, and Transparent Markets, central; however, unless you are ready to conceed that a small handful of irrelevant, underemployed, disenfranchised malcontent bloggers and tweeters have actually succeeded in steering the entire public debate toward Free Market Socialism and other Mixed Economic models, you'll have to conceed that plain old boring Empirical Analysis warrants the Snark, Anger, and Activism. In either case, as a defender of the status quo 19th century industrial wage slavery capitalism meme, you lose. You're just increasingly out of touch with present economic reality.

And when level heads like Barry Ritholz concur with data-driven sentiment that further supports a secular bull market for Snark and Anger, you become utterly irrelevant. Obsolete.

Case in point: while sharing the Back Story to Bailout Nation, Ritholz wrote:

The more I researched and wrote, the more it was apparent we were witnessing the greatest heist ever made. By the last section of the book, history’s biggest transfer of wealth — from the taxpayer to the Banksters — was taking place. Trillions were being shifted from the responsible to the reckless, from the prudent to the incompetent. It was infuriating — and you will see as the book progresses my initial academic tone gets replaced with greater snark and anger.

Keep in mind that The Reckless and Incompent referenced above are the same people that Mssrs. Kudlow, Forbes, Draper, et al, would likely refer to as the "Best and Brightest of Capitalism" off of whose backs government should dismount. Of course, when government gets off the backs of the criminals, then that same lot blames the government (us, You and Me) for not being on their backs. I used to think apologists for that circular argument were just stupid; now I realize that such are both stupid and malicious. Not stupid because they don't see their own logic as circular; but stupid because they think that We The People don't see right through it. The origins of the deeply rooted maliciousness -- toward themselves and others -- which seeks to further skew such an insanely skewed system simply escapes all rational explaination.

Disclaimer: I'm fairly confident that this blog takes exception to several of Mr. Ritholz's specific financial and policy perspectives and I'm equally confident that Mr. Ritholz would not likely give this blog the time of day. However, such speculative dissonance only serves to further strenthen the case for justifiable Snark and Anger directed at Las Magus: those thousands of alchemical scumbags, along with their posses of millions of boot-licking, ass-kissing, Office Space suck-ups that systematically fired the upstanding for "not fitting in with the team" as such teams twisted entire corporate cultures into the image of their own skewed and twisted makers.

All I'm suggesting here is that when diverse, data-driven perspectives come to agree, that's usual an area worth noticing. In this case, the Unsustainable Resources Skews that typify our increasingly obsolete 19th century industrial capitalism more than merit the Snark and Anger.

So shall we too remain, until the song no longer remains the same.

Keep Trying or Drop Out? Case of the Brown v. Leary Economy

Excellent post, David, although you are probably constrained by your bosses to toe the U-3 estimate line, only alluding to U-6 realities, while not giving the real U-6 forecasts which will likely be about double that 9.5% ... so call it 20% ... and anyone selling that number is essentially reduced to praying that it's a tad overstated; even though growing numbers of forecasts suggest otherwise.

Also, a quick response to the idea of "skills atrophy." I'd suggest that happens disproportionately at the bottom of the barrel, not for the cream at the top.

More commonly, only Charlie Brown keeps trying to kick the ball after more than two or three good yanks. The smart people all say, "no thanks" when the game is rigged against them and take their generally OVERACHIEVING skills to the sidelines and even out of the stadium. This isn't about "re-educating" Maynard James Keenan's "tidal waves of dumbfounded dipshits."

Rather, one of the abiding tragedies of perpetuating Unsustainable Resource Skews is that WE LOSE THE BEST AND BRIGHTEST because they understand exactly what it means for them when 70% of the available net wealth is permanently hoarded by 5% of the population.

The math of that situation simply don't work out, do it?

Geithner on Salary Caps

Fine, then don't call them salary caps if Forbes, Draper, & Co. keep squealing and whining. Call them  20x Rational Restraint Ratios that ensure all stakeholders and VALUE CREATORS participate proportionately in the returns earned by their Shared Fate labors while simultaneously Richly Rewarding innovation, investment, and market savvy.

Why are such ratios essential? Regular readers already know the answer to that question, but we'll add here that primarily, ratios -- in addition to a whole suite of interrelated policies -- help to assure that that the economic circulatory system continues to operate in a sustainable manner. Cash clots kill and economy, just as surely as blood clots kill a body. Moreover, it is also physically, mathematically, existentially impossible for any individual human's contribution to the race to be worth billions or trillions of times more than any other human being. It's empirically impossible. We each only have 24 hours in a day and none of us is AGI-Posthuman-Enhanced just yet. Even then, it will ethically impossible in the land where it continues to be asserted that All Are Created Equal, with Certain Inalienable Rights, including Liberty and Justice for All.

Let's also briefly address the entitlement issue one more time. These economic blood clots do not have a "right" to exist. Nor do pathological hoarders have a "right" to indulge their mental illness, just because it's intertwined with cash. In fact, that entanglement makes their mental illness even more damaging to society.

Compulsive hoarding is a DSM-IV illness . Maybe it is genetic, and that might partly explain why insane levels of wholly unsustainable skews of untold wealth run in genetic lines. Mental illness attached to money is still mental illness. Literally, there are just a few thousand very sick compulsively hoarding human beings acting as blood clots within the flailing American economy. Just because the object of their hoarding can be hidden away in offshore accounts, doesn't make it any less hoarding. Just because everyone understands the value of cash, that doesn't mean that the Marginal Psychological Value of cash doesn't encounter an inflection point somewhere in the $100M range.

Everyone knows that there is a point at which the slips of paper lose ALL MEANINGFUL VALUE and the game devolves into a seventh grade playground pissing contest. Even the skewed-up hoarders themselves acknowledge this: watch, listen, and learn.

So go ahead, try to explain to me a Healthy Human Psychological Profile that NEEDS more than $100M in Personal Assets while neighbors are Giving Away Their Children just to survive. Healthy human beings consider the health of the village within which they were enabled to acquire so much. Of course they OWE the community; because without the community, there would be no context within which to play out this compulsive cash hoarding illness.

This unsustainable, skewed wealth hoarding is just psychologically sick and morally revolting. We've said that this is going to get personal and as unemployment rates continue to grow, the demands to Publish The List of the top 1000 most fiscally sick and sadistic are only going to grow.

Bottom line: Ayn Rand and Aldous Huxley were both wrong. The road to postscarcity is not an avenue that Parades Satanic Sloth, escorted by a Panoptic Police State; it is a road toward the fulfillment of the penultimate Promise and Triumph of Industrial Capitalism.

So let us not lament that something is lost. Celebrate instead the success of human ingenuity and perseverance that has brought us so far. WE DID IT! Huzzah! Freedom from Want and Poverty can be ours through new ways of participation and inclusion on the human stage. No caps, no limits to the potentials for humanity.

What Would You Do for House Payments of $50?

Anything! You shout with palpitating anticipation of scoring The Deal of the Millennium.

Oh, wait; actually, we'd do anything but move there.

But, but, but ... if CAPITALISM is omnipotent and MARKETS are omniscient, that place should be overwhelmed with buyers right now. And look, look, look, we have CURVES and GRAPHS that *PROVE* that Invisible Make Believe Theoretical Real Equilibrium-Claus is just about to slide down the chimney with toys and make-busy fake jobs for all the good little wage slave boys and girls.

We'll be back to the Normal That Caused All This in no time! Just tap your heals three times and join the rest of us in the BOTTOM 90% of Americans who work two jobs for just enough money to pay rent -- just like our Share Cropper great grandparents -- and repeat:

"There's no place called home. There's no place called home. There's no place called home."

Concerto for Squealing Piggies and Harried Hoarders in “F” Major

Big man, pig man, ha ha, charade you are
You well heeled big wheel, ha ha, charade you are
And when your hand is on your heart …
You're nearly a good laugh
Almost a joker
With your head down in the pig pen
Sayin’ "keep on diggy’in"
Pig stain on your fat chin
What do you hope to find?
When you're down in the pig mine
You're nearly a laugh
You're nearly a laugh
But you're really a cry …

-- Roger Waters, on Animals

We can be confident that we’re making progress when the turrets of the Grand Old Pedantic party are reduced to loading up histrionic emotional pejoratives as their last bastion of defense:

“The assumption that the pursuit of self-interest within the rules and conventions of society will also promote the public interest may be succeeded by a mushy collectivist pseudo-altruism, in which jealousy and envy are given a free ride …”

Right. It’s jealousy and envy, not empirical observation of Unsustainable Resource Skews which are functionally equivalent to massive blood clots lodged throughout the global economic circulatory system. Note to the non-empirically minded: if you clot up 42% of your vital bodily fluids, into any 1% of your body; or, if you clot up nearly 70% of any resource into 5% of any system; that, my friend, is unsustainable unto immediate herky-jerky death.

I don’t know how that makes you feel, emotionally, but any presiding physician’s recorded Time of Death is just another cold, analytical statistic.

After all, if I might mirror an astonishingly articulate miscarriage of fact by our good friends at FT, “There is a risk that empirically dubious but emotionally attractive interpretations, which enshrine wild west, every man for himself, bar room brawl capitalism; and which call for a rapid return to the failed status quo, could gain ground.” Which is merely to say:

First they ignore us, then they laugh at us, then they attack us, then they copy us, then we win. Same as it ever was.

“Victims of your own success, unite! You have nothing to lose but your Unsustainable Resource Skews.”

Back To Normal

So you just want everything to go back to normal? Really?



Click here to view if the Seesmic Embed keeps flaking out on you.

Mad props to the one and only KDFA!

Does 13.3% U3 Unemployment Imply 30% U6 by Year End?

Sure, you can snap back with a quick and quippy Kudlow NO, but to do so without considering the data courtesy of the eponymous Big Picture thinker himself, Barry Ritholtz, might be a bit hasty, to say the least:

Bob Bronson "suggests that you bullishly extrapolate the “less worse” downtick in the Continuing Claims just reported, assuming the trend continues in a straight line without interruption, which is extremely unlikely (see the dotted arrows in chart below). He reaches an Unemployment Rate of 13.0% before yearend: 32 weeks times an average 0.15% increase (declining from 0.30% to 0.00%) added to 8.9% = 13.3%."

It's definitely time to Read More.

Oh, and Happy Mother's Day. Right.

What if 30% and Growing Unemployment is Equilibrium

In February, we asked What if 25% and Growing Real U.S. Unemployment is Equilibrium? Today, given the ongoing trend we see in today's unemployment situation report below and yesterday's comments from collaborators at the National Employment Law Project and UC-Berkeley, we have to upgrade this query to the 30% level.

We're nearly at one out of four laid-off workers has already been out of work for six months. That's Andrew Stettner at the National Employment Law Project. He and his research partners at UC-Berkeley predict the share of long-term unemployed will hit 30 percent by next year.

This, while reporters chirp this morning, "the unemployment situation IMPROVED this month," fixating on a modest Decrease in the Rate of Decrease; whereas U-6 is vastly more reflective of reality, even if it too suffers the usual statistical challenges that result in unavoidable understatement. We can only count that which presents itself for counting. All too often, these numbers are like counting the ants we can see on the surface and calling it the whole anthill. The counting itself is accurate enough, the physical reality ... um, not so much.

Debunking the Devil Formerly Known as Godless Socialism

From an extraordinarily timely NYT article:

Such things are easy for an American to ridicule; you don’t have to be a Fox News commentator to sneer at what, in the midst of a global financial crisis, seems like [OMG!] Socialism Gone Wild.

But there’s more to it.

This was one of the puzzling features of the Netherlands — the Dutch pioneered the multinational corporation and advanced the concept of shares of stock, and last year the country was the third-largest investor in U.S. businesses — and yet it has what I had been led to believe was a vast, socialistic welfare state. How can these [seemingly] polar-opposite value systems coexist?

Thank you for the referral, Georges!