Middle Class Tax Hikes Put Trump Tax Cuts in Jeopardy – Ep. 291

Middle Class Tax Hikes Put Trump Tax Cuts in Jeopardy – Ep. 291

Congress May Not Deliver Promised Economic Growth
I think part of the renewed weakness in the dollar may be due to the feeling that all the tax cuts are not going to pass. The Trump/Republican plan outlined some days ago will be difficult to to get through Congress. Even if it does get through Congress it is not going to deliver the economic growth that is being advertised.
Tax Cuts Masquerading as Reform
Go back to the origins to the Republican dialogue about tax reform. They actually wanted to do reform. All the reform is out the window now. All we have is tax cuts masquerading as reform. But the initial concept that the Republicans had was to try to move toward a consumption-based tax system. They tried to do that through the back door with the BAT (Border Adjusted Tax), which is the opposite of what the Republicans are now promising, which was tax relief for the middle class. That's not what they are delivering.
Getting Around Elimination of State & Local Tax Deductions
A lot of people are going to get tax increases. Part of the problem, though is the elimination of the deductibility of state and local taxes. I mentioned on an earlier podcast that the states can get around this by shifting the tax to a payroll tax that will be fully deductible for the employers. Any resulting reduction in salary would be offset by the elimination of state and local taxes. If the states react the way I think they will to the loss of the deduction, the governments will not reap the tax windfall that they expect, causing much bigger deficits.
Big Deficits Ahead
At the end of the day the bill may not pass because Congress may not be willing to sign on to anything that raises taxes. They want everybody to get at tax cut. How are you going to do that? How are you going to cut income taxes and not cut spending on anything without having a huge increase in the deficit - which of course is what is going to happen.
Recession Ahead
You can try to assume that some of that increase is not there because of dynamic scoring, you can assume that tax cuts are going to lead to economic growth. Maybe they will, but I think regardless we're going to have a recession. There is no recession in any of the forecasts. Nobody thinks a recession is coming at any point during the next 10 years, whether we cut taxes or not. I think, whether we cut taxes or not we're going to have a recession, and if there is a recession, you can throw all this dynamic scoring out the window!
Production Equals Stimulus
Even if the recession is not as severe as a result of the tax cuts, the results will still be huge increases in the budget deficit. They are losing some Republican support and they are going to have to reach across the aisle, and there is no way the Democrats will sign on to any tax cuts for the "rich". If they take away tax cuts on corporations, they take away the reduction in the marginal tax rate, then you lose any hope of economic stimulus. That is where the stimulus comes from. Real economic stimulus comes from more capital investment, more job creation, less consumption. That is what you get when you reduce marginal taxes on people with the highest propensity to save and invest.
Inflation Ahead
The Keynesians have it backwards. They think stimulus comes from consumption - it doesn't. Consumption doesn't stimulate anything. Consumption without production just leads to higher prices which is what is going to happen. We are going to get more inflation. Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

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SchiffRadio Podcast Episode 24

SchiffRadio Podcast Episode 24

Big News out of the Central Banks * U.S. FOMC * Primary concern - inflation is too low * no policy to "correct" the problem * Preparing markets for additional stimulus * Japanese Central Bank Doublespeak * Japanese sales tax hike postponed * Continued calls for more inflation * Why is sales tax is different than inflation? * Euro Decline * Mandating "stability" by increasing inflation? * Chinese Central Bank * Cut interest rate to 5.6% * Money flows to the dollar as a hedge because the market believes the Fed * Gold has not dropped much against the dollar and has risen against other currencies Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

22 Nov 201431min

SchiffRadio Podcast Episode 23

SchiffRadio Podcast Episode 23

Episode 23: Going to Extreme to Prove a Point: Two articles about Peter Schiff: * MarketWatch - writer refused to address corrections before going to print except for my official title - The point of my forecasts is to help people avoid problems ahead of time - I did not call for a stock market crash; I predicted QE4 - The Fed can prevent a Dollar Crisis - I said hyperinflation is unlikely, but a possibility * New Republic - Writer quotes selectively from a Reason article to prove his own spin - Points to the CPI to refute real inflation - The price of a Big Mac mirrored the CPI until 2002 - Now price of Big Mac rises 2x as fast as CPI - This illustrates how the government measures inflation Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

21 Nov 201427min

SchiffRadio Podcast Episode 22

SchiffRadio Podcast Episode 22

Episode 22: Lessons from the Michael Brown Case: * Don't rob a convenience store. * Don't rob a convenience store while high. * Don't be conspicuous after robbing a convenience store while high. * If a policeman then stops you, obey the policeman. * Do not try to take the policeman's gun away from him. * But if you get shot in the hand going for the gun and run away, do not charge the policeman when he says, "freeze!" * The political narrative hides the real problem: unhealthy family life. Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

20 Nov 201421min

SchiffRadio Podcast Episode 21

SchiffRadio Podcast Episode 21

Episode 21: BoJ Seems to relieve Consumers' Struggle With Rising Prices by Creating More Inflation * Investors & Economists shocked to learn that Japan is officially in recession * Instead of a 2.1 rebound, there were back to back declines - a huge miss. * Economists cry "More Stimulus!" * Abe admits rising prices hurt the economy, contrary to inflation "Goal" * The theory that rising prices stimulate the economy is proving wrong in Japan, Russia and the U.S. Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

19 Nov 201426min

SchiffRadio Podcast Episode 20

SchiffRadio Podcast Episode 20

Episode 20: Explosive Daily Upside Reversal in Gold Portends Potential Bottom * Weekly jobless claims higher than expected * Fewer people in the workforce * Job openings declining * Consumer sentiment survey at 7-year high? * false confidence in the economy due to oil prices * QE4 will be the mother of all QE * Gold and silver market reversal on Friday * Silver stocks up $4% * Gold stocks were up 6% Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

17 Nov 201420min

SchiffRadio Podcast Episode 19

SchiffRadio Podcast Episode 19

Episode 19: Low-Paying Jobs And Student Debt Undermining Marriage * There are more single Americans than ever * Job quality and debt are disincentive to marriage * Government policy promotes generations of single mothers * Two out of every five mothers are single * If the economy is getting better, why is this happening? Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

13 Nov 201414min

SchiffRadio Podcast Episode 18

SchiffRadio Podcast Episode 18

Episode 18 Synopsis * Obamacare architect Jonathan Gruber admits fraud promoting Obamacare: * "They proposed it and that passed, because the American people are too stupid to understand the difference." * Administration's argument to Supreme Court about constitutionality of Exchanges claims "typo" * The average American may not be able to make decisions for others, but they know what is best for themselves Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

13 Nov 201420min

SchiffRadio Podcast Episode 17

SchiffRadio Podcast Episode 17

Episode 17 Synopsis * Japanese yen fell to 7-year low * A result of Abenomics * Speculation that planned increase of sales will be delayed * price moving with strength of dollar * Chinese Yuan up vs Yen and euro * Next few months may expose Fed's false narrativ Our Sponsors: * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

12 Nov 201410min

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