Implode-Explode Heavy Industries news feed http://implode-explode.com/ Tracking the many faces of the global credit implosion. en-us iehi-feed-62159 Sat, 29 Apr 2017 03:35:04 GMT Delving Into That Q1 GDP Stinker... http://implode-explode.com/viewnews/2017-04-28_DelvingIntoThatQ1GDPStinker.html iehi-feed-62158 Fri, 28 Apr 2017 23:06:33 GMT U.S. first quarter growth weakest in three years as consumer spending falters http://implode-explode.com/viewnews/2017-04-28_USfirstquartergrowthweakestinthreeyearsasconsumerspendingfalters.html iehi-feed-62157 Thu, 27 Apr 2017 23:31:27 GMT 'Fist bumps' at hedge funds over Trump's tax plan http://implode-explode.com/viewnews/2017-04-27_FistbumpsathedgefundsoverTrumpstaxplan.html "For hedge funds, this is an unmitigated benefit as their tax liabilities could drop significantly," said Robert Willens, an independent tax consultant. "Obviously, they are quite enthusiastic and there may be a few fist bumps along the way."

A manager whose hedge fund earns $50 million a year, for example, would be paying some $19.8 million in taxes, or 39.6 percent, under the current rules. That could drop to as little as $7.5 million if the rate were cut to 15 percent.

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Aside from the pass-through proposal, an open question is what kind of treatment will be given to so-called carried interest. That allows managers to pay a tax rate as low as 20 percent, a loophole that Trump has railed against in the past.

Similarly, there is no clarity on whether businesses would be required to pay "reasonable compensation" to their managers, income that could be taxed at a higher rate, experts said. Including that could help Trump appeal to his base and mollify critics who say the plan is a giveaway for millionaires.

"Who needs to worry about carried-interest going away if you have a 15 percent pass-through tax rate," said hedge fund manager Jim Chanos, who runs Kynikos Associates. "This should really be called the 'Put Rich Guys Back on Top Tax Act of 2017.'"

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iehi-feed-62156 Thu, 27 Apr 2017 23:29:46 GMT Donald Trump used to hate Wall Street. Now he embraces it http://implode-explode.com/viewnews/2017-04-27_DonaldTrumpusedtohateWallStreetNowheembracesit.html The Wall Street influence is evident already in Trump's policy flip flops.

He's dialed back massively on the protectionist trade talk, especially on China. Trump campaigned on ripping up trade agreements like NAFTA and labeling China a currency manipulator (a fancy word for a cheater) on "Day One" in office. None of that happened.

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He's even started saying nice things about Janet Yellen, the head of the Federal Reserve, whom he blasted on the campaign trail for rigging the economy to make Obama look better.

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Trump relishes praise, and investors have cheered his pro-Wall Street shift by sending the stock market to record highs. It's been dubbed the "Trump rally." The Dow and S&P 500 have jumped over 10% since he won the election, a fact the president likes to tout on Twitter and in his speeches (it's even mentioned on the White House website).

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iehi-feed-62155 Thu, 27 Apr 2017 21:32:06 GMT If Mortgage Rates Tick Up Even a Little, What'll Happen to Canada's House Price Bubble? http://implode-explode.com/viewnews/2017-04-27_IfMortgageRatesTickUpEvenaLittleWhatllHappentoCanadasHousePriceB.html iehi-feed-62154 Thu, 27 Apr 2017 21:28:22 GMT Pending Home Sales Drop In March - Now Stagnant For 2 Years http://implode-explode.com/viewnews/2017-04-27_PendingHomeSalesDropInMarchNowStagnantFor2Years.html iehi-feed-62153 Thu, 27 Apr 2017 16:51:50 GMT Obama's $400,000 Wall Street Speech Is Completely In Character http://implode-explode.com/viewnews/2017-04-27_Obamas400000WallStreetSpeechIsCompletelyInCharacter.html iehi-feed-62152 Thu, 27 Apr 2017 16:46:56 GMT Walmart pushes deeper into financial services http://implode-explode.com/viewnews/2017-04-27_Walmartpushesdeeperintofinancialservices.html iehi-feed-62151 Thu, 27 Apr 2017 16:18:38 GMT Why Trump should have ditched the mortgage-interest deduction http://implode-explode.com/viewnews/2017-04-27_WhyTrumpshouldhaveditchedthemortgageinterestdeduction.html While many Americans and lobbyists working on behalf of the real estate industry defend the mortgage-interest deduction, not too many people are taking it. Wealthy Americans are far more likely to benefit from the mortgage-interest deduction than others, in part because they're more likely to itemize their tax returns.

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Trump's plan calls for doubling the standard deduction to $12,400 for single individuals and $25,200 for married couples filing jointly, which consequently would raise the bar in terms of the amount homeowners need to pay in mortgage interest to qualify.

That makes it even more likely that wealthy Americans and those living in high-priced real estate markets will be the ones to benefit, said Svenja Gudell, chief economist at real estate website Zillow. "Before it was for the wealthy, now it's for the ultra-wealthy," Gudell said.

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iehi-feed-62150 Thu, 27 Apr 2017 15:05:05 GMT The U.S. Student Loan Implosion: By The Numbers http://implode-explode.com/viewnews/2017-04-27_TheUSStudentLoanImplosionByTheNumbers.html iehi-feed-62149 Thu, 27 Apr 2017 14:53:20 GMT Canada's Biggest Mortgage Lender Crashes; Gets Rescue -- End of Line For Housing Bubble? http://implode-explode.com/viewnews/2017-04-27_CanadasBiggestMortgageLenderCrashesGetsRescueEndofLineForHousing.html Today... the stock of Home Capital Group cratered by over 60%, its biggest drop on record, after the company disclosed that it struck an emergency liquidity arrangement for a C$2 billion ($1.5 billion) credit line to counter evaporating deposits at terms that will leave the alternative mortgage lender unable to meet financial targets, and worse, may leave it insolvent in very short notice.

As part of this inevitable outcome, one which presages the company's eventual disintegration and likely liquidation, Bloomberg reports that the non-binding rescue loan with an unnamed counterparty will be secured by a portfolio of mortgage loans originated by Home Trust, the Toronto-based firm said in a statement Wednesday. Home Capital shares dropped by 61% in Toronto to the lowest since 2003, dragging down other home lenders. Equitable Group Inc. fell 17 percent, Street Capital Group Inc. fell 13 percent, while First National Financial Corp. declined 7.6 percent. In short, the Canadian mortgage bubble has finally burst.

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iehi-feed-62148 Thu, 27 Apr 2017 14:43:57 GMT Fiscal FactCheck: How Much Will Trump's Tax Plan Cost? http://implode-explode.com/viewnews/2017-04-27_FiscalFactCheckHowMuchWillTrumpsTaxPlanCost.html iehi-feed-62147 Wed, 26 Apr 2017 20:19:47 GMT Lucky, good or tipped off? the curious case of government data and the Pound http://implode-explode.com/viewnews/2017-04-26_LuckygoodortippedoffthecuriouscaseofgovernmentdataandthePound.html iehi-feed-62145 Wed, 26 Apr 2017 18:47:46 GMT There's a Huge Disagreement Between Bonds and Stocks http://implode-explode.com/viewnews/2017-04-26_TheresaHugeDisagreementBetweenBondsandStocks.html iehi-feed-62144 Wed, 26 Apr 2017 14:57:12 GMT Trump to Stick to Proposed Standard Deduction Boost; 15% Corp and Pass-Thru Rate http://implode-explode.com/viewnews/2017-04-26_TrumptoSticktoProposedStandardDeductionBoost15CorpandPassThruRat.html President Trump on Wednesday plans to call for a significant increase in the standard deduction people can claim on their tax returns, potentially putting thousands of dollars each year into the pockets of tens of millions of Americans, according to two people briefed on the plan.

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Trump will call for a sharp reduction in the corporate tax rate, from 35 percent to 15 percent. He will also propose lowering the tax rate for millions of small businesses that now file their tax returns under the individual tax code, two people familiar with the plan said.

These companies, often referred to as "pass throughs" or S corporations, would be subject to the 15 percent rate proposed for corporations. Many pass throughs are small family-owned businesses, but they can also be large, such as parts of Trump's own real estate empire or law firms with partners who earn more than a million dollars annually. The White House is expected to pursue safeguards to ensure that companies like law firms can't take advantage of this new tax rate and allow their highly paid partners to pay much lower tax bills.

We can't say we wouldn't like these tax rates, though slim chance they get through Congress in one piece. And of they're done, they'll probably finally blow a fatal hole in U.S. finances, due to the deficit impact.

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iehi-feed-62143 Wed, 26 Apr 2017 04:45:34 GMT Wells Fargo's Fraud-Fostering Board Saved By "Uncle Warren" http://implode-explode.com/viewnews/2017-04-26_WellsFargosFraudFosteringBoardSavedByUncleWarren.html iehi-feed-62141 Tue, 25 Apr 2017 16:45:58 GMT Desperate "Naked selfie" Loans Proliferate on Chinese Platforms http://implode-explode.com/viewnews/2017-04-25_DesperateNakedselfieLoansProliferateonChinesePlatforms.html Interest on the "nude loans" reached an astonishing 30 percent a week, according to the Global Times newspaper. Lenders told female borrowers that if they failed to repay the loans, their nude photos would be sent to their families and friends, whose information was also required for some transactions, the article said.

Material in the file put on the web last Wednesday showed some borrowers also promised to repay loans with sexual favours, according to screen captures posted on social media websites.

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iehi-feed-62140 Tue, 25 Apr 2017 16:05:10 GMT The oil market has one big problem: People aren't buying enough gas http://implode-explode.com/viewnews/2017-04-25_TheoilmarkethasonebigproblemPeoplearentbuyingenoughgas.html iehi-feed-62139 Tue, 25 Apr 2017 16:03:17 GMT China Markets Reel as $1.7 Trillion in Shadow Funds Unwinds http://implode-explode.com/viewnews/2017-04-25_ChinaMarketsReelas17TrillioninShadowFundsUnwinds.html The turbulence has centered on so-called entrusted investments -- funds that Chinese banks farm out to external asset managers. After years of funneling money into such investments, banks are now pulling back in response to a series of regulatory guidelines over the past three weeks that put a spotlight on the risks. Critics have blamed entrusted managers for adding leverage to China's financial system and reducing transparency.

The banks' withdrawals helped erase $315 billion of stock market value over the past six days and sent bond yields to the highest level in nearly two years, highlighting the challenge for Chinese authorities as they try to rein in shadow banking activity without destabilizing financial markets. While the government has plenty of firepower to prop up asset prices if it wants to, forecasters at Australia & New Zealand Banking Group Ltd. predict the selloff will deepen this year.

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iehi-feed-62138 Tue, 25 Apr 2017 02:58:01 GMT Trump seeks 15 percent corporate tax rate, even if it swells the national debt http://implode-explode.com/viewnews/2017-04-24_Trumpseeks15percentcorporatetaxrateevenifitswellsthenationaldebt.html President Trump is pursuing a drastic cut in the corporate tax rate, a move that is likely to grow the national debt and breach a long-held Republican goal of curbing federal borrowing.

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Trump surprised lawmakers -- and even many advisers -- last week when he announced he would release details of his tax plan on Wednesday. Advisers said Trump is eager to make a mark on a top issue before the 100-day anniversary of his administration, after being frustrated by House Republicans over the failure to advance legislation to replace the Affordable Care Act.

But several House Republicans close to Ryan said that they were taken aback by the latest tax push. They said the president risked alienating the speaker and his allies on Capitol Hill if they got behind a proposal that had weak or fragile support in the chamber, and they expressed concern about Congress piling up too many issues this week, such as a revived effort to pass a health-care overhaul and keep the government funded while funneling money toward border security projects.

... lawmakers from both parties have said the corporate tax rate must be reduced to help U.S. companies compete with firms headquartered in other countries and to prevent U.S. firms from moving overseas.

The Tax Policy Center, a nonpartisan tax group affiliated with the Brookings Institution and Urban Institute, has estimated that Trump's corporate tax proposal, as outlined during the campaign, would cost $2.4 trillion over 10 years.

"Deficits don't matter"!

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