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Savers the most secure credit are discriminated against in lending
June 27, 2022
6:22 pm
Vatox
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AllanB said
Notice all the stock promoters defend the spend.

Easy money doesn't lead to inflation? No debt crisis?  

The main reason we have such high inflation is the disruptions in supply. Many things have all hit at the same time. Debt isn’t causing it or we would have seen high inflation many years ago.

June 27, 2022
9:36 pm
RetirEd
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Inflation: I would remind that all the borrowing and lack of production of goods and services during the pandemic is a major (if not the major) cause of inflation - lots of money looking for a reduced supply of goods. The Putin Putch has certainly added to that with massive asset destruction.

Doesn't anyone remember how, at the start of the pandemic and the generous benefits governments launched, we were all wondering who would end up paying the bill for all the borrowing?

This is very much one of the biggest questions in political choice facing our economy and that of the USA. The political parties have widely divergent plans for this - cut taxes and spending, or raise taxes to avoid cutting it.
RetirEd

RetirEd

June 28, 2022
5:56 am
AllanB
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Vatox said

Debt isn’t causing it or we would have seen high inflation many years ago.  

Housing wasn't accounted for in inflation.

June 28, 2022
6:19 am
Bill
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RetireEd, anyone who has calculated total fed & prov debt amounts and divided it by the number of taxpaying adults in this country (try it), knows that higher taxes for those people won't make a dent. Huge economic wealth creation (which won't happen unless attitudes change) or inflation might.

June 28, 2022
8:03 am
COIN
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"The political parties have widely divergent plans for this - cut taxes and spending, or raise taxes to avoid cutting it."

There is talk in some circles about a "wealth tax" and/or a "home equity tax". They might even bring back "death duties" again.

June 28, 2022
8:19 am
cgouimet
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COIN said
"The political parties have widely divergent plans for this - cut taxes and spending, or raise taxes to avoid cutting it."

There is talk in some circles about a "wealth tax" and/or a "home equity tax". They might even bring back "death duties" again.  

The Liberals wouldn't do any of that but the NDP might.

CGO
June 29, 2022
8:23 pm
RetirEd
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Bill, as COIN pointed out, income taxes are not the only options. Not to mention corporate taxes, which do come from clients of business - but even the poorest, oldest and most infirm help pay those business taxes.
RetirEd

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June 30, 2022
9:51 am
COIN
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"but even the poorest, oldest and most infirm help pay those business taxes"

True, but I think many of these folks also benefit from government money.

Anyway, I wouldn't be surprise if they increase the HST. If I remember correctly, many European countries have much higher VAT rates.

June 30, 2022
3:57 pm
Bill
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RetireEd, as you say even the poor, infirm, etc end up paying for business taxes as business taxes end up in the final price to consumers and it's people that end up paying all the taxes. Even if dividends are cut a lot of pension funds' incomes will be shorter, and that's peoples' pensions. So businesses don't pay taxes, in the end, it's people, seems to me. I believe Canada gov't debt is now over $100k per person (i.e. including children, etc), so as I said I don't see tax increases that can be levied on the people who already pay the taxes that will make a dent in that as well as continue to pay existing taxes for ongoing and always-rising government expenditures.

Euro countries do have higher VAT rates than Canada's HST or GST+PST regimes, it's true. But their social safety nets are usually more generous too (e.g. free university), far as I can tell.
So it's hard to just compare the rates.

June 30, 2022
4:54 pm
HermanH
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Bill said
But their social safety nets are usually more generous too (e.g. free university), far as I can tell.

I was led to believe that European university tuition was free, too. However, a European explained to me that it was not totally accurate. (I think he was from Germany.) It is likely country specific, but he told me that the labour department determined how many positions in a field were needed in the future and calculated how many university positions would be covered by the State. Those positions were free and awarded according to competitive scholastic achievement, but anyone else could also study at their own cost. It sounded reasonable and practical.

June 30, 2022
7:09 pm
COIN
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HermanH said
but he told me that the labour department determined how many positions in a field were needed in the future and calculated how many university positions would be covered by the State.  

I think something somewhat similar is happening in Ontario with respect to the trades. The problem is we are producing university grads who don't know how to build or fix things. What we really need are more people in the trades.

Ever tried to get a roofer lately?

June 30, 2022
9:09 pm
Norman1
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Bill said
RetireEd, anyone who has calculated total fed & prov debt amounts and divided it by the number of taxpaying adults in this country (try it), knows that higher taxes for those people won't make a dent. Huge economic wealth creation (which won't happen unless attitudes change) or inflation might.

It isn't really that big of a problem.

Earlier, I calculated that $2 trillion of new federal government debt would require about an 8.4% increase in revenues to service.

Fortunately, $2 trillion was not needed to deal with the pandemic. The final figure is less than the $400.2 billion budget deficit for 2021.

So, federal government has to raise revenues around 1/5 of 8.4% = 1.7%.

It's not a tremendous hardship, for example, if the 5% GST were to become a 5% x 1.017 = 5.085% GST.

July 1, 2022
5:35 am
Bill
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Ok. I can see that costs of servicing the debt are manageable, especially if your calculation presumes long-term rates don't rise materially.

I was referring more to making a dent in the debt, vs steadily increasing it, making a dent in the currently $100K of debt there is for each individual in Canada no matter their age or income status, e.g. the over $300k in gov't debt for a household of 3 in Canada, how would you ever get a material amount of that money from every single household in yet additional taxes? You can't. Yet I regularly hear agreement that passing on debt to future generations is not fair, people say they want to reduce that burden.

Of course if you tell me the debt never has to be reduced materially, in fact it can continue to rise, then we're good.

July 1, 2022
6:56 am
savemoresaveoften
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Bill said
Ok. I can see that costs of servicing the debt are manageable, especially if your calculation presumes long-term rates don't rise materially.

I was referring more to making a dent in the debt, vs steadily increasing it, making a dent in the currently $100K of debt there is for each individual in Canada no matter their age or income status, e.g. the over $300k in gov't debt for a household of 3 in Canada, how would you ever get a material amount of that money from every single household in yet additional taxes? You can't. Yet I regularly hear agreement that passing on debt to future generations is not fair, people say they want to reduce that burden.

Of course if you tell me the debt never has to be reduced materially, in fact it can continue to rise, then we're good.  

US debt has been growing steadily and they are doing ok.
A country's debt vs a individual's debt is very different.
As long as the country is strong/have strong allies, has natural resources, and politically stable, debt is not an issue, growing or not.

July 1, 2022
9:17 am
AllanB
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savemoresaveoften said

As long as the country is strong/have strong allies, and politically stable 

Western democratic countries are not as strong as they use to be and no longer politically stable. There is no way Canada is in the Top 20 of least corrupt countries. In Ontario for example it seems every major contract turns into scandal. The feds spent over $400 billion this past couple years much of it unnecessary. AAA Lmao.

July 1, 2022
9:42 am
MattS
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AllanB said

savemoresaveoften said

As long as the country is strong/have strong allies, and politically stable 

Western democratic countries are not as strong as they use to be and no longer politically stable. There is no way Canada is in the Top 20 of least corrupt countries. In Ontario for example it seems every major contract turns into scandal. The feds spent over $400 billion this past couple years much of it unnecessary. AAA Lmao.  

If debt is truly not an issue, and servicing the said debt not an issue, and all the extra interest accumulated doesn’t lead to less services , then I resent the fact they don’t print a bag of money and leave it on my doorstep… why would they discriminate against me because I was willing to work through pandemic when I had co workers sitting at home falsely claiming to be scared of getting sick? Why pick and choose it’s of no consequence so atleast reward me for going and actually providing the goods and services to the people that were too afraid to go to work still wanted and weren’t too afraid to go out and buy them.. geez the more I wrote the more I resent no bag of money being dropped off

July 1, 2022
10:25 am
mechone
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AllanB said

savemoresaveoften said

As long as the country is strong/have strong allies, and politically stable 

Western democratic countries are not as strong as they use to be and no longer politically stable. There is no way Canada is in the Top 20 of least corrupt countries. In Ontario for example it seems every major contract turns into scandal. The feds spent over $400 billion this past couple years much of it unnecessary. AAA Lmao.  

Please explain "In Ontario every major contract turns into scandel" Not true I can't think of one since the Liberals were given the door and thats why in the last 2 elections that are not even a party ,but a group of 8. But please name some ,I can give a list so long under the liberals your head will spin

July 1, 2022
10:54 am
Norman1
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Bill said

I was referring more to making a dent in the debt, vs steadily increasing it, making a dent in the currently $100K of debt there is for each individual in Canada no matter their age or income status, e.g. the over $300k in gov't debt for a household of 3 in Canada, how would you ever get a material amount of that money from every single household in yet additional taxes? You can't. Yet I regularly hear agreement that passing on debt to future generations is not fair, people say they want to reduce that burden.

Of course if you tell me the debt never has to be reduced materially, in fact it can continue to rise, then we're good.

It depends on the circumstances. The debt really doesn't need to be paid off. That's more ideology than reality. But, there is a limit though how much the debt can rise.

The limit is not zero as some balanced-budget fanatics insist. But, the limit is not as high as some tax-the-rich socialists like to believe.

Whether or not passing debt to future generations is fair depends on what the future generations get in return. It is not unfair for a child to inherit the servicing of $100,000 of debt when that debt is bundled with the lifetime use of a $1 million cottage. When she passes away, the servicing of the $100,000 of debt passes, with the life interest in the cottage, to a grandchild.

July 1, 2022
10:59 am
AllanB
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mechone said

Please explain "In Ontario every major contract turns into scandel" Not true I can't think of one since the Liberals were given the door and thats why in the last 2 elections that are not even a party ,but a group of 8. But please name some ,I can give a list so long under the liberals your head will spin  

Doug was complicit in the $400 billion stimulus spending scandal. He happily wink wink took the massive download spend helping to put all Canadians in jeopardy; he transferred the debt upstream while still running big deficits. I would be surprised if he didn't take some for himself. During his term home speculation got out of control you see the result. The real estate developers run the province. I was a supporter till he went along with the shutdown.

July 1, 2022
1:14 pm
COIN
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Not all debts are the same.

Is the creditor domestic or foreign?

Is the debt denominated in CAD, USD, Bitcoin, etc.?

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