White House considering ways to incentivize U.S. households to invest in the stock market.

Foffy

Member
Oct 25, 2017
6,902
Taxes which would be going to the government for healthcare/education/infrastructure would be going to the stock market instead and big companies would profit. Highly doubt the government/people will see a return of investment from more taxes paid by those companies.
If it has no market value, it has no value. That's the Golden Rule in America. This is yet another phase of solidifying that cancerous domain of thought.
 

PeskyToaster

Member
Oct 27, 2017
6,281
Reduce government revenue in order to necessitate further cuts to programs and then reduce government revenue..... rinse and repeat.
Also jolt the numbers up by November to either carry you through election or leave the next person with the remains after the house of deregulated cards collapses.

AKA conservative economic policy.
 

Somnid

Member
Oct 25, 2017
3,075
Investment is how rich make money off poor saps who think the casino isn't rigged. You also need to have disposable cash before you can play.
 

Baconmonk

Avenger
Oct 26, 2017
5,279
"Gambling"

 

Fatoy

Member
Mar 13, 2019
1,860
Unless I'm missing something, this sounds a bit like the UK's stocks and shares ISA wrappers.
 

DrewFu

Member
Apr 19, 2018
9,042
If you're going to come in and condescend and act like you have some authoritative knowledge that "most people" have enough discretionary income to invest, I think it is.
It isn't condescending to point out that most people aren't poor nor rich. If you took it that way, that's on you.
 
Oct 27, 2017
11,257
It’s interesting how many people in this thread think investing is gambling. Feels like they’re conflating it with day trading, which you should definitely not do.
 

Hollywood Duo

Member
Oct 25, 2017
17,283
so like 802kk
"Gambling"

On the other hand one could say that looks a lot like a bubble
 

Apharmd

Member
Oct 25, 2017
5,062
The average person is perfectly capable, fanatically, to invest. This doesn't just help rich people.
Income for most Americans is down against inflation for the past 40 years. You must live in a bubble to think that the "average person" can invest significant amounts of money. The cost of living has gone up and our wages have not.
 

ScribbleD

Banned
Oct 28, 2017
1,402
It isn't condescending to point out that most people aren't poor nor rich. If you took it that way, that's one you. On Era there seems to be a common perception that you're either cruising on a yacht, or dirt poor.
You came in here and asserted that "most people" have the discretionary income to invest. That's bullshit.
 

DrewFu

Member
Apr 19, 2018
9,042
Income for most Americans is down against inflation for the past 40 years. You must live in a bubble to think that the "average person" can invest significant amounts of money. The cost of living has gone up and our wages have not.
Where did I say the average person can invest significant amounts of money?
 
Oct 27, 2017
2,547
Main Line
This reminds me of the time Bush tried to privatize Social Security, with the idea that people would instead invest in the stock market, just before the markets crashed in 2007. So propping up the markets with infusions of government funds.

Then - Social Security funds
Now - our tax dollars we really need to pay for infrastructure, the social safety net, etc.
First thing I thought of, there was serious discussion and debate in Congress at the time
 

Meatfist

Member
Oct 25, 2017
958
Who exactly is this for? Maxing your 401(k) and establishing a liquid emergency fund should take priority over short-term investing, and if you're able to do both of those you're probably close to that $200K household earning amount...
 

whatsinaname

Member
Oct 25, 2017
7,124
Looking at some 2016 numbers, 5 million people maxed out their 401k contribution. (140 million returns filed).

So how many people is this benefiting?

And investing in the stock market is clearly not creating jobs or helping out the wider population (as evidenced by the tax savings given to companies going back straight into stock buybacks). What even is the point of this thing?
 

Rover

Member
Oct 25, 2017
2,779
"Gambling"


I get your point but those dips in the chart are major economic devastations, and a lot of people are not bank rolled to just 'come back' from those.

The general upward trend does not mean everybody survives the trip.
 
Oct 25, 2017
2,848
Interesting that they would limit it to incomes of less than $200k.

Are folks under that level really already maxing out their $19,500 401ks and $7,100 HSAs?
 

XMonkey

Member
Oct 26, 2017
3,083
I don’t really disagree with the idea by itself, but the reason investment % has gone down is probably because wage growth has sucked for the longest time and people don’t have leftover money to invest in the first place. Let’s work on fixing that, foremost.
 

ScribbleD

Banned
Oct 28, 2017
1,402
Where did I say the average person can invest significant amounts of money?
Oh, you're right. The average person is totally just emptying the 50-100 dollars they have squirreled away in change jugs to bet big on investments.

This is why you were asked about your income level, because it sounds like you're living in a well-off bubble while confidently asserting things that are not true for "most of us"
 
Jan 29, 2018
2,324
Under one scenario, a household earning up to $200,000 could invest $10,000 on a tax-free basis, although officials noted these numbers are fluid.
I'm confused on how this would work. If you're earning under $200,000 and buy $10k worth of stocks, then sell them years later when you're earning over $200k, are the capital gains tax free? What about dividends paid while your salary is under the threshold?
 

Apharmd

Member
Oct 25, 2017
5,062
Where did I say the average person can invest significant amounts of money?
You said that the average person is capable of investing. Unless they start young or can afford to invest a decent amount of money, how does what you said make the White House's suggestion a program that would benefit the average American person enough to matter?

I look at this as I do with Social Security privatization- it's just a ploy to throw more money into the market so they can have a temporary field day with it.
 

smurfx

Member
Oct 25, 2017
4,293
oh good it gives the mega rich an incentive to manipulate the stock market and fuck over regular people out of their money.
 

DrewFu

Member
Apr 19, 2018
9,042
You said that the average person is capable of investing. Unless they start young or can afford to invest a decent amount of money, how does what you said make the White House's suggestion a program that would benefit the average American person enough to matter?

I look at this as I do with Social Security privatization- it's just a ploy to throw more money into the market so they can have a temporary field day with it.
Fair point.
 

Cilidra

Member
Oct 25, 2017
653
Ottawa
We have something like that in Canada. It's called Tax-Free Saving Accounts. They are registered accounts (like 401k or IFA) but you can take out the money at anytime without penalities. The money you put in is after tax (unlike 401k and IFA) but all the growth is tax-free both on-going and when you take it out.

It can be invested in pretty much any financial type investment (stocks, mutual funds, bonds or mix of it).

So for example if you wanted to save money for a house, you put money in there, it grows tax free and you can take it out when you need it (tax-free)

There is a limit of how much you can put in (5000-6000$ per year since the program started).

It's a very nice complement to traditional retirement saving since you don't have to wait for retirement to take it out.

While obviously it not for everyone, even people with more limited income can benefit from it. And since the limit is not percentage based but hard number, it only marginally benefit the ultra-rich.
 

Josh5890

The Fallen
Oct 25, 2017
3,743
In theory it sounds like a good idea to get more people to invest.

I am highly skeptical thought that it will actually benefit the middle class if/when it gets put into action
 

WedgeX

Member
Oct 27, 2017
5,647
Looking at some 2016 numbers, 5 million people maxed out their 401k contribution. (140 million returns filed).

So how many people is this benefiting?

And investing in the stock market is clearly not creating jobs or helping out the wider population (as evidenced by the tax savings given to companies going back straight into stock buybacks). What even is the point of this thing?
I really appreciate your bringing real numbers into this - helps massively with the perspective.
 

TitlePending

The Fallen
Dec 26, 2018
1,454
Just another way to continue juicing the markets.

How about we shore up social safety net programs like Social Security that EVERYONE should be getting?
 

whatsinaname

Member
Oct 25, 2017
7,124
I'm confused on how this would work. If you're earning under $200,000 and buy $10k worth of stocks, then sell them years later when you're earning over $200k, are the capital gains tax free? What about dividends paid while your salary is under the threshold?
What's also stopping me from buying some super stable stock in Dec 2019. Selling in Jan 2020. And essentially taking my (top tax bracket x $10,000) for free?

We have something like that in Canada. It's called Tax-Free Saving Accounts. They are registered accounts (like 401k or IFA) but you can take out the money at anytime without penalities. The money you put in is after tax (unlike 401k and IFA) but all the growth is tax-free both on-going and when you take it out.

So for example if you wanted to save money for a house, you put money in there, it grows tax free and you can take it out when you need it (tax-free)

There is a limit of how much you can put in (5000-6000$ per year since the program started).

It's a very nice complement to traditional retirement saving since you don't have to wait for retirement to take it out.

While obviously it not for everyone, even people with more limited income can benefit from it. And since the limit is not percentage based but hard number, it only marginally benefit the ultra-rich.
The US has Roth IRAs that sound similar to that.
 

Henry Jones Jr

Avenger
Oct 27, 2017
417
I'm confused on how this would work. If you're earning under $200,000 and buy $10k worth of stocks, then sell them years later when you're earning over $200k, are the capital gains tax free? What about dividends paid while your salary is under the threshold?
I’m guessing what they mean by tax free is that you do it as a deduction and you won’t pay income tax on that 10k.
 

krazen

Member
Oct 27, 2017
1,871
Gentrified Brooklyn
"Gambling"

Eventually there will be a downturn and nobody knows how steep the correction will be. Asking the avg american family’s savings: rainy day funds, saving for college, into the market ABSOLUTELY is gambling.
Particularly in 2020 with so many bad actors in the markets.

Its why recent big name IPO’s have gotten slaughtered, everybody knows a large part of this bull market is a pony show. And we are going to be asking households to put money into it, which is effectively another form of corporate welfare w/ fees for trading platforms and artificially injecting money into the markets?

The barrier should be lower (but imho education is the issue). But imagine what massacre 2008 would have been if in addition to home equity plain old savings were ties to the market
 

Emergency & I

Member
Oct 27, 2017
4,473
Surface-level this appears like a reasonable idea that’ll help people plan for the future and be incentivized for doing so. Cool.
 

Prax

Member
Oct 25, 2017
1,638
Yeesh.

I invest and think it's a great opportunity, but a lot of people are plain not cut out for it, and this sounds like it's asking people to gamble their wealth away on risky stock picks or pay exorbiant fees to a bunch of grifters to do it for them.