Investing 101

Stock



I chose to use a picture of a piece of pie because owning stock is like having a little slice of the company, the more stock you purchase, the bigger percent of the company you own.


Bond

I chose to use a pinky promise because a bond involves borrowing money and then promising to pay it back later on. If you don't pay it back, you risk paying even more or legal issues.


Primary and Secondary Market

I chose to use this picture because it represents companies competing to get more business. In this picture, honey bees bring more honey to impress the queen bee.

Bulls and Bears



I chose this picture because they represent opposites, just like bears and bulls are opposite. Bulls are optimistic about the market while bears are pessimistic.


Selling Short


I chose this picture because it represents selling short, which is when the company benefits from the price of a stock falling. In a pawn shop, usually people sell their belongings and then buy it back for cheaper later.

Franchise


I chose to use these wooden dolls because a franchise is a smaller part of a large corporation, but are still the same.

Underwrite/Underwriter/Going Public


I chose this picture because it represents going public with someones engagement, just like going public in a market economy.

When I'm 30...

     Now that I am 30, here's where we are economically; we have continued on the same economic path that we have been for the last 10-12 years.  We still have a giant deficit, and the economy is very slow to improve.  Its very hard to pay off student loans because students just don't have the money to do so, and nobody can help with it because no one has the money. Struggling Individuals and families are forced to pay for a college education, yet don't have the money, so they are stuck with the burden off taking out loans and paying these loans off for many years.  Its hard for kids to pay for schooling, so they are having to take out loans, which take years and years to pay off.

     Due to the weak economy, it is almost impossible for people to find jobs, especially whom are right out of college.  People are forced to make lifestyle changes like finding a cheaper place to live, sell their cars, and spend less due to the fact that they have very little income.  It is very hard on people because they don't know what to do and they can't do much to improve it by themselves.  The economy has gotten worse, but it has stayed about the same for the past two or three years.  In order to improve our economy and our massive deficit of $21 trillion, people are going to have to make much smarter choices financially.  Due to the great amount of debt, businesses are struggling which ends up effecting the general public.

Manifesto 2.0

1. The governments role in the economy should be to create a balance between taxes, businesses, and the private sector that helps promote economic stability. When taxes increase, the private sector stops putting money into the economy, which in turn leads to the downfall of small businesses. Finding this balance is difficult, but worth it in the end. Investorguide.com supports my opinion when it says "the role of the US government in the acquisition and redistribution of money in society is central to understanding the relationship between resources and the citizenry." This relationship that the government is trying to build is difficult due to the vastness of the federal government and the programs needed to maintain a stable economy.

2. I do not agree with how much money is being taken from individuals' income. I believe that increasing taxation in any portion is the wrong way to go, unless the income for that family is well over the normal range. Instead, the government should tighten the loopholes that many corporations have found that decrease the amount of taxes they are paying. Large corporations spend a lot of money on accountants to find loopholes when they could have just paid the taxes that were due.

3. First, I do not think that any cuts should be made to the Medicaid, Medicare, or Social Security programs. These programs are already at a point where our older population can barely live within our own economy. One of the areas that could be decreased is the defense budget. I know it is very important to defend our country, and hopefully we won't need to be having so many of our own over seas for much longer. The defense program has the third highest cost to run every year. The other area is the discretionary funds. At certain times in our economy, some programs that are not a necessity to the American people should be decreased.

4. One of the major choices I made for the Federal Budget Challenge was cutting $852 billion on War Spending. Seeing that we will be leaving the middle east sometime in the near future, spending more money on military ships and missile defense systems is unnecessary. Another area I chose to save money in was Taxation. I believe taxes should be increased for those who have a higher income as well as corporations paying their fair share.

5.   My picture is of someone carrying the weight of taxes on their shoulders. This represents the burden of paying high taxes. Taxes are necessary for the funding of our social services, but finding the balance so Americans can feel like they can put money back into the economy is key.

Taxes

Progressive:

pros: Some believe that the progressive tax code ensures that the wealthy pay their fair share in taxes. It helps make sure that those who have the highest income are asked to contribute more, and helps those who can't afford to pay taxes and keep a roof over their head at the same time be able to keep some money for themselves. This method could help the economy by keeping more families afloat. <"A progressive system distributes the risks of economic changes by basing a family's tax burden on their ability to pay.">

cons: Progressive taxes discourages economic growth by burdening high-income earners. Taxing high income earners more money only decreases their wealth, which would decrease how many high income earners there are. Also, raising taxes would kill job creation. The more money you take away from the rich, the less money they have to strengthen the economy by starting their own businesses and making investments. Taxing the rich to benefit the poor is also sending a bad message. It's  basically saying that you don't need to work hard because other people are working hard for you. The wealthy people worked hard for their income and don't want to give it away to someone who doesn't give an effort. <"We're running out of rich people to tax by taxing the few surviving millionaires into oblivion.">

I oppose to this tax because even though the wealthy people of the nation could probably still do well with a progressive tax system, it isn't fair to them to pay more.

Flat:

pros: All incomes under a flat tax are taxed at the same rate. Also, only a person's wage income would be taxed. The flat tax code also usually exempts lower incomes entirely. The flat tax rate is so attractive to many because of its simplicity. It also eliminates loopholes for wealthy people who hire accountants who know how to take advantage of existing loopholes. The flat tax code also emphasizes work, savings and investing, and inherit fairness. <"Fairness is the greatest virtue of the flat tax, no matter how much money you make, what kind of business you are in, and whether or not you have lobbyists in Washington, you will be taxed at the same percentage as everyone else.">

cons: Wealthy people could end up not paying any taxes if they get their income from dividends and capital gains. Since only the income wage is taxed, the lower class could still be paying 17% while the wealthy is paying 0%. Opponents argue that the only people pushing for a flat tax rate are the wealthy because they would benefit from it the most. <"Every Republican flat tax we have seen either explodes the deficit or raises income taxes on middle income families.">

I oppose to this tax because it would not benefit the population as a whole.

National Sales:

pros: National Sales tax is a much simpler way of taxing. It would also eliminate any problems with the current tax system. Also, this tax would create a fair market for corporate and noncorporate companies and allow them to make decisions regardless of taxation. < It would get rid of the differential tax treatment of corporate and noncorporate businesses, since under the current system, corporate earnings are taxed twice- once when the corporation is taxed on income, and again when dividends are provided to share holders.">

cons: Some believe that this tax would cripple the American lower class by the wealthy not having to pay as much as the middle and lower class. The middle and lower class spends so much time trying to make ends meet, that if the government used the National Sales Tax, then it would be unfair to them.<"Replacing most federal taxes with a national sales tax would cause large tax increases for most Americans while allowing huge tax cuts for the wealthiest.">

I oppose to this tax because it puts more strain on the middle and lower class, which makes up more of our population than the wealthy do.

VAT:

pros: A big advantage of the VAT is that it helps keep corporate taxes down. Keeping these taxes down helps the U.S. become bigger in the international market. Also, it could help pay off the national debt in the long run. <"The size and complexity of domestic and international corporate taxes are indeed a problem in the United States of America, VAT could well relieve some of those issues.">

cons: The problem with VAT is that the middle and lower class would be taxed 5% on everything they buy, so prices would be higher for necessities. Raising prices like this would keep customers away from buying from the american market. Another reason to be against it is that the price doesn't change. <"Being a tax on consumption, its a regressive tax, one that is disproportionately burdensome on the poor and middle class.  The lower a persons income, the greater the proportion of that income that goes into products and services.">

I support this tax because it has the best chance of helping the U.S. with the national debt. 

The Big Picture

I recommend to the President's economic advisers that they should focus on decreasing funding on federal programs that do not benefit the majority of the national population. This would increase the economy and help focus spending on things that would help more people. They should also delegate spending in areas that would increase jobs. This would also help the economy in the long run, as well as open jobs up for people so they can make an income and pay taxes.

The President claims that "our children are our future". So they should put more effort into making sure that education is funded adequately. Decreasing funds toward education would negatively affect how students would continue to learn. The government should continue to maintain funding towards education so that the children of today's society continue to learn and grow into responsible tax-paying citizens when they come of age.