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Someone needs to teach the President some proven history so perhaps we can avoid the disastrous road he’s driving us down. It’s as if President Obama is so arrogant that he refuses to acknowledge the proven success of the past with tax cuts that he won’t even consider the option.
Here’s one chart illustrating the fact that tax cuts create sustained jobs over the long haul:
Despite the mortgage crisis created by Barney Frank, Chris Dodd and others during the last few years, Bush’s tax cuts have helped to truly stimulate job creation, that’s an indisputable fact.
Jack Kemp examines Reagan’s tax cutting results:
One would have to ignore the facts if we didn’t give credit to Reagan’s military build up and his radical “supply-side” tax cuts of 1981 and 1982 to get our economy “moving again.”
He cut tax rates by 25% across the board, he defended and supported Federal Reserve Board Chairman Paul Volker’s tightened money tax policy, thus strengthening the dollar while wringing inflation out of the economy. These steps along with lowering the trade and regulatory barriers helped the U.S. economy grow well over 4.5% while unemployment dropped below 5% for the first time in a decade.
As the economy grew, revenues increased and the wealth of our nation began to produce the jobs that took unemployment from more than 6.5% down to 4.5% with price stability, something the Keynesian economists (and some conservatives as well) said couldn’t happen.
The simple fact is that when the government does not confiscate as much wealth, the country as a whole does better. However, when tired old socialist policies make their way into public policy from President Obama, the opposite will be true.
Under Obama, the government will be the only entity which is stimulated.
One can only conclude that President Obama is pro-government and little more.
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Right, But you have to admit that if you are going to give tax cuts than you need to adjust your budget for that. Reagan, HW Bush and Bush Jr., Failed at this.
Reagan’s tax cuts were not balanced until Clinton.
But Reagan’s tax cuts pulled us out of recession, and 18% average interest rates.
“Reagan’s tax cuts were not balanced until Clinton.”
JD, was your economic professor a total liberal or is it just that you’re so deep in the whole for Obama? You will have to be specific when you use terms like balanced. It sounds to me like you’re always eager to give credit to Clinton or the Dems, but you consistently fail to recognize that the republicans were forcing Clinton’s hand, no credit is given to the republicans for balancing the budget. What kind of power do you think Clinton had when the Repubs were the majority? And how do you think the Repubs became the majority? It was the people who voted them in and brought them to power. Why? Because Americans were not happy will the dems leadership, including Clinton. That said; let’s review the basic pillars of Reaganomics, shall we.
Reaganomics, a swear word to liberals and a breath of fresh air for conservatives.
1. Reduce the growth of government spending,
2. Reduce marginal tax rates on income from labor and capital
3. Reduce government regulation of the economy,
4. Control the money supply to reduce inflation.
JD, what is it that you disagree with? Is it because it doesn’t have Clinton all over it. If this was Clinton’s economic policy you would be praising it, and you know it.
Now we know that Obama and the Democrats will never take part in this, no matter how successful it may have been. It flies in the face of everything this socialist President and congress believe and are working at lightning pace towards.
Obama has just announced that he is going to limit charitable givings by limiting the ability to receive tax write offs, charities will stand to loose 3 to 5 BILLION in givings. However when asked about this, Obama responded by saying that this is why he put 100 million in the Stimulus. Can you believe this? 100 million will make up for 3-5 Billion. He is such a stooge. This is all part of a plan to make America more dependent on Obama’s government. It’s just sickening.
Now if Obama were to cut taxes on the rich the way Reagan did, we would start to see the results of trickle down economics, instead of shove it down your throat socialism.
Cutting taxes, that’s change you can believe in!
Is it that you can’t learn or that you won’t learn?
Bill Hedges Mar 1st, 2009 at 6:45 pm
jd
lets read about Bill Clinton’s balanced budget. Are you correct ? Did Republican Congress force it on him ?
http://rpc.senate.gov/rel.....AL2.JT.htm
CG
Kind of wondered when you all would get aroud to it. I had spent alot of time on Reaganomics comment as well.
I just sit back and read anymore.
No Bill, I look forward to reading your savvy remarks to JD. Don’t sit back, pounce! I just said to Nate tonight, Where’s Bill? We were getting worried about ya.
By all means, school us on Reaganomics. I love to discuss Reaganomics with a fellow believer. Lately the only one discussing is Rush and Hannity. Rush has become my saving grace three hours a day.
Bill Hedges Feb 28th, 2009 at 6:08 pm
TAX CUTS ONLY ANSWER-REAGONOMICS
…..
In Springfield Missouri, I have seen this bumper sticker
“I am a Republican. Because Everyone can not be on welfare.”
Soon to read
“Eat at McDonald, A Counter Employee pays my Social Security”
…..
I hear the mandate o has is to get his proposal implimented. He talks of his high vote % in election. I have never heard his group speak in present tense. Why ?
“Approval rating 59%”
“The President is using his popularity to try and convince Americans that government has a bigger and more positive role to play in the life of the nation. New polling data shows he still has work to do on that front—59% still agree with Ronald Reagan’s assertion that “Government is not the solution to our problem; government is the problem.””
http://www.rasmussenrepor.....cking_poll
…..
Although one’s past history has been proven to be unimportant, prehaps honesty is still important. o points to possibility that America could fall into Depression, “Black Hole”, and never see the light again.
How true is above paragraph. are we as close to Depression as never before. Ronald Reagan is praised by us . 59% in above polls believes Reagan. Why ?
“Lou Cannon, who has written five books on Reagan, is struck by one common element in the two presidencies”.
“In 1981, when Reagan was in office, it was as bad in unemployment as Obama faces, much worse in some areas,” Cannon says. “We’re talking about the two worst economic situations in Reagan’s and Obama’s that have been inherited since the Depression.”
http://www.npr.org/templa.....=100077084
Did o get this saying here ?
o be accuate instead of SCARY. Our economy is almost as bad as during the Reagan Era. Bill Clinton tells o not to be so scary. Sort of like Bush tried to calm ? (couldn’t be)
So 59% believe Reagan, bigger governmet not anwser. Hey, same rating for o approval, but o numbers are falling.
…..
What about Ronal Reagan. Let talk facts and not listen to “bad talk” . This first paragraph will ENRAGE Librals. So Sorry.
“This study also exposes 12 fables of Reaganomics, such as that the rich got richer and the poor got poorer, the Reagan tax cuts caused the deficit to explode, and Bill Clinton’s economic record has been better than Reagan’s.”
“On 8 of the 10 key economic variables examined, the American economy performed better during the Reagan years than during the pre- and post-Reagan years.”
1.”Real economic growth averaged 3.2 percent during the Reagan years versus 2.8 percent during the Ford-Carter years and 2.1 percent during the Bush-Clinton years.”
2.”Real median family income grew by $4,000 during the Reagan period after experiencing no growth in the pre-Reagan years; it experienced a loss of almost $1,500 in the post-Reagan years.”
3.”Interest rates, inflation, and unemployment fell faster under Reagan than they did immediately before or after his presidency”.
4.”The only economic variable that was worse in the Reagan period than in both the pre- and post-Reagan years was the savings rate, which fell rapidly in the 1980s. The productivity rate was higher in the pre-Reagan years but much lower in the post-Reagan years”.
“This study also exposes 12 fables of Reaganomics, such as that the rich got richer and the poor got poorer, the Reagan tax cuts caused the deficit to explode, and Bill Clinton’s economic record has been better than Reagan’s”.
BE SURE TO PRESS… HTML AT BOTTOM…READ ENTIRE STORY
http://www.cato.org/pub_d.....ub_id=1120 – 28k -
Have to go back to.. Obama Has Become A Walking Contradiction.. for links to work
Bill Clinton did not balaance budget.
Thank Newt Gingrich and the PEOPLE for voting in Republican control
……
Stephen Moore is director of fiscal policy studies at the Cato Institute.
And 1993 — the year of the giant Clinton tax hike — was not the turning
point in the deficit wars, either. In fact, in 1995, two years after that
tax hike, the budget baseline submitted by the president’s own Office of
Management and Budget and the nonpartisan Congressional Budget Office
predicted $200 billion deficits for as far as the eye could see. The figure
shows the Clinton deficit baseline. What changed this bleak outlook?
Newt Gingrich and company — for all their faults — have received virtually
no credit for balancing the budget. Yet today’s surplus is, in part, a
byproduct of the GOP’s single-minded crusade to end 30 years of red ink.
Arguably, Gingrich’s finest hour as Speaker came in March 1995 when he
rallied the entire Republican House caucus behind the idea of eliminating
the deficit within seven years.
——————————————————————————–
We have a balanced budget today that is mostly a result of 1) an
exceptionally strong economy that is creating gobs of new tax revenues and
2) a shrinking military budget. Social spending is still soaring and now
costs more than $1 trillion.
——————————————————————————–
Skeptics said it could not be done in seven years. The GOP did it in four.
…….IMPORTANT…..
Now let us contrast this with the Clinton fiscal record. Recall that it was
the Clinton White House that fought Republicans every inch of the way in
balancing the budget in 1995. When Republicans proposed their own
balanced-budget plan, the White House waged a shameless Mediscare campaign
to torpedo the plan — a campaign that the Washington Post slammed as “pure
demagoguery.” It was Bill Clinton who, during the big budget fight in 1995,
had to submit not one, not two, but five budgets until he begrudgingly
matched the GOP’s balanced-budget plan. In fact, during the height of the
budget wars in the summer of 1995, the Clinton administration admitted that
“balancing the budget is not one of our top priorities.”
And lest we forget, it was Bill Clinton and his wife who tried to engineer a
federal takeover of the health care system — a plan that would have sent
the government’s finances into the stratosphere. Tom Delay was right: for
Clinton to take credit for the balanced budget is like Chicago Cubs pitcher
Steve Trachsel taking credit for delivering the pitch to Mark McGuire that
he hit out of the park for his 62nd home run.
The figure shows that the actual cumulative budget deficit from 1994 to 1998
was almost $600 billion below the Clintonomics baseline. Part of the
explanation for the balanced budget is that Republicans in Congress had the
common sense to reject the most reckless features of Clintonomics. Just this
year, Bill Clinton’s budget proposed more than $100 billion in new social
spending — proposals that were mostly tossed overboard. It’s funny, but
back in January the White House didn’t seem too concerned about saving the
surplus for “shoring up Social Security.”
Stephen Moore is director of fiscal policy studies at the Cato Institute.
And 1993 — the year of the giant Clinton tax hike — was not the turning
point in the deficit wars, either. In fact, in 1995, two years after that
tax hike, the budget baseline submitted by the president’s own Office of
Management and Budget and the nonpartisan Congressional Budget Office
predicted $200 billion deficits for as far as the eye could see. The figure
shows the Clinton deficit baseline. What changed this bleak outlook?
Newt Gingrich and company — for all their faults — have received virtually
no credit for balancing the budget. Yet today’s surplus is, in part, a
byproduct of the GOP’s single-minded crusade to end 30 years of red ink.
Arguably, Gingrich’s finest hour as Speaker came in March 1995 when he
rallied the entire Republican House caucus behind the idea of eliminating
the deficit within seven years.
——————————————————————————–
We have a balanced budget today that is mostly a result of 1) an
exceptionally strong economy that is creating gobs of new tax revenues and
2) a shrinking military budget. Social spending is still soaring and now
costs more than $1 trillion.
——————————————————————————–
Skeptics said it could not be done in seven years. The GOP did it in four.
Now let us contrast this with the Clinton fiscal record. Recall that it was
the Clinton White House that fought Republicans every inch of the way in
balancing the budget in 1995. When Republicans proposed their own
balanced-budget plan, the White House waged a shameless Mediscare campaign
to torpedo the plan — a campaign that the Washington Post slammed as “pure
demagoguery.” It was Bill Clinton who, during the big budget fight in 1995,
had to submit not one, not two, but five budgets until he begrudgingly
matched the GOP’s balanced-budget plan. In fact, during the height of the
budget wars in the summer of 1995, the Clinton administration admitted that
“balancing the budget is not one of our top priorities.”
And lest we forget, it was Bill Clinton and his wife who tried to engineer a
federal takeover of the health care system — a plan that would have sent
the government’s finances into the stratosphere. Tom Delay was right: for
Clinton to take credit for the balanced budget is like Chicago Cubs pitcher
Steve Trachsel taking credit for delivering the pitch to Mark McGuire that
he hit out of the park for his 62nd home run.
The figure shows that the actual cumulative budget deficit from 1994 to 1998
was almost $600 billion below the Clintonomics baseline. Part of the
explanation for the balanced budget is that Republicans in Congress had the
common sense to reject the most reckless features of Clintonomics. Just this
year, Bill Clinton’s budget proposed more than $100 billion in new social
spending — proposals that were mostly tossed overboard. It’s funny, but
back in January the White House didn’t seem too concerned about saving the
surplus for “shoring up Social Security.”
Stephen Moore is director of fiscal policy studies at the Cato Institute.
http://www.google.com/sea.....lz=1I7GWYE
jd
Ever wonder why o does not say..Bill Clinton balnced his budget, I’ll follow his example ? Instead he goes all the way back to FDR.
Conservative Gal
Is what jd says below correct. Does Dave Ramsey preach this. I was taught to invest money that you can afford to loss. I find this impossible to believe !
Investing..Use money before you pay your bills and debts ?
jd said..
“Finally, Dave Ramsey even Dave Ramsey said at his seminar that although the market looks grim…BUY BUY BUY and invest in the Mutual funds. If you notice he tells us to invest the first 15% of our income, FIRST… before we pay our bills and debt. Again, If obama can invest what he is and cut the budget deficit in half by his first term than he has done a good job.”
Bill, many MANY people like Dave Ramsey use the technique “Pay yourself first”. They recommend 10 to 15% of your gross income off the top each pay period before anything else is paid. It’s a good technique and here is some of the common reasoning behind it:
The more you make, the more you need. The average person can always find something to spend their paycheck on, even after a raise. But if you’re disciplined enough to set aside 10 -15% off the top for saving/investing, you learn very shortly that you don’t miss it. The most common mistake people make is to spend on everything they need/want, and then see if anything’s left to save/invest. There never is. If you make that first percentage a “bill” and pay it first, you learn to live on the other larger percentage very well.
I was first introduced to this theory some 30 years ago with a book titled “The Wealthy Barber”. It was a story of a Barber (yes, the haircutting kind), who began to set aside just 10% of a very meager salary, and by the time he was at retirement age, he was worth over $3 million dollars. It’s the miracle of compound interest.
I presented each of my children, my neices and nephews, and grandchildren with that same book over the years. The ones that listened are financially responsible and solid. The ones that didn’t live paycheck to paycheck and pray they don’t get laid off.
So yes, Dave Ramsey does subscribe to this. But he’s certainly not the first, and I don’t think he claims to be.
Also, Bill, the old adage is not to play the stock market with money unless you can afford to lose it. That’s a separate issue than solid and safe saving/investing.
Babs
I no nothing of Dave. I was going by Conservative gal when she said
“Dave’s whole premise is to speak out against debt,”
In a very risky market with interest rates rising significately, I found the reasoning bad.
That’s just me….
I would like to add that you all are crying about the taxes rolling back to Reagan’s tax percentages but it isn’t even going to happen until 2011.
So it is business as usual for 2 more years. It is estimated that we will be in the recovery mode from the recession by 2010 so the tax roll back will would occur 1 year after the hopeful recovery. It is not going to happen during the recession.
Thoughts?
Babs said in two comments
“Bill, many MANY people like Dave Ramsey use the technique “Pay yourself first”. They recommend 10 to 15% of your gross income off the top each pay period before anything else is paid. It’s a good technique and here is some of the common reasoning behind it:”
“JD, I’m really hoping you’re not “buying, buying, buying” like you claim. I’ve been through 3 decades of the stock market actively. I’m telling you – the market is a “hold” at best. Investors are selling for a reason – good reasons. Please don’t throw your money away here.”
Babs
Is there a conflict here ?
Or is my thought, you dismissed, valid here..the old adage is not to play the stock market with money unless you can afford to lose it. Or in unknown market
I might add, most people have credit card debt. Interest has been raised by a sugnicate % recently. I just read that paying off such debt would be smarter.
I personal believe your second paragraph as being your true belief.
You may wish to separate economics truths, I tend to bundle. As a check list
No, Bill, there’s no conflict, and I stand behind both statements as they’re not particularly related. What you do with the 10-15% you pay yourself could be as simple as putting it under a mattress, it doesn’t matter, as long as you put it away for the preverbial rainy day. That’s the point – don’t spend it, either save it or invest it.
I happen to think the stock market is a risky choice at this time. Perhaps if you want to buy a DRIP plan for a good company like Southern Company – which is a stable utility company and an excellent dividend acheiver – that would be prudent. To play the short term buy low/sell high game is too risky right now, and day trading is tantamount to the poker tables in Vegas.
So again, both are true and sensible.
What thought of yours have I dismissed??
Babs
As far as I care jd can get a bank loan and invest everything. Could care less if he goes bust or becomes millionare.
I would like a link to read this myself
“What thought of yours have I dismissed??”- I stated it after dismismissed . I also said-You may wish to separate economics truths, I tend to bundle. As a check list
I’ll say it again, give me a link
Thanks Bill. I would rather be a millionaire.
.
I disagree with the philosophy that WAR is worthy cause and social programs are a bad one. That doesn’t mean some can’t be a worthy cause and some social programs are bad ones. However, Republicans have had a war during each other administrations.
Reagan – Cold War
HW Bush – Kuwait
W Bush – Iraq
Wars are the use of military and military is a social program of our government and that means it comes at a cost.
Do I think…
1. Reduce the growth of government spending = Yes
2. Reduce marginal tax rates on income from labor and capital = Yes
3. Reduce government regulation of the economy = Yes and No…Maybe not to extent we are at today but they must be regulated to some extent.
4. Control the money supply to reduce inflation = yes
However, you can not do those things when you are paying for a cold war, or invading Kuwait\Iraq. This is where the Republican philosophy falls short. Where does the money for a war come from???
Who pays for the war??? How can you pay for a war if government can only raise money through taxes? How can you raise taxes for a war if your party is against raising taxes?
We have been left with the debt of all three of those wars when, if it was important to wage them, we should have paid fro them through taxes… If anything, temporary taxes. I.E. Cold War, tax.
It use to be this way. When we went to war there was a tax associated with it to pay for the war (Spanish-American war). Not anymore. This is where the Republican party has fallen flat on its face because they can not raise taxes or they would be hypocrites.
Babs
This dicusion for me got stated from….
CG said
“Dave’s whole premise is to speak out against debt,”
Babs
1.Did I take CG statement out of context
2. did I misunderstand
3. Is she wrong
4. Did I misquote her
5.. ??
Babs
You tell me
jd
I provided 2 different subjects that prove tax deduction stimulates economy. Bill Clinton one shows Republican’s balanced budget against President repeated argument. This article
JD, war has no party.
WWI – Woodrow Wilson, Democrat
WWII – President Roosevelt & Truman, Democrats
Korean War – Harry Truman, Democrat
The Vietnam Conflict (never declared as a war) began in 1959 and included 2 republican presidents and 2 democratic presidents: Eisenhower, Kennedy, LBJ, and Nixon
And I just saw a news program yesterday detailing the debt from WWII that we are STILL paying.
As I said before I was interupted………..
JD…….In your last post you gave the perfect reason why President Clinton was the last one to have a balanced budget…..He didn’t have to fight the COLD WAR !!!
He also had the Tech bubble which brought immense prosperity to America.IT BURST AS BUSH TOOK OVER.
NAME ONE THING CLINTON DID ON HIS OWN WHICH BALANCED THE BUDGET !!!
Welcome back, DD, stick around this time.
Bill, I’m sorry, you’ve lost me on the other part of your discussion. I’m not sure what you’re asking.
Bill Clinton had Republican controled Congress that forced it. 5 times Bill submitted deciet budgets. Poved earlier on this post
Babs
I can’t state it clearer. Please forget
President Obama has stated that he is willing to negotiate with terrorist with no pre-conditions.HOWEVER he is unable to include ANY Republicans in his stimulus package discussions and says we shouldn’t listen to Rush Limbaugh?
Hmmmmmmm……….
I assume this is what is called TRANSPARANCY by the administration.
In regards to Clinton’s balanced budget, its effects, true meaning, etc., I found an excellent article that explains it all beautifully. It also addresses the reason Clinton was able to balance the budget. You might find this interesting, JD.
http://www.frbsf.org/econ.....98-03.html
Just to be clear, I am not saying Clinton balance the budget by himself. However, the point is that it wasn’t balanced during the 12 years of Reagan and bush. Both Republicans who at most points had a congress to back them up.
Babs
Did your read my comment about Clinton and balanced budget with documentation. It explain many things in more detail than yours in my opinion. Bill fought balance
JD, if you’ll take a look at the article, and it’s too long to post or I would, you would see that credit was clearly given to the Reagan years as being the REASON that Clinton was able to balance the budget. Listen, I voted for Clinton, I was glad he balanced the budget. But you have to give credit where credit is due. And the balanced budget of Clinton was made possible by the prudent choices made by Ronald Reagan. The article is not a partisan article at all. Take a look at it.
Yes, Bill, I did read your comments. You might enjoy reading this article as well. What Clinton did was a great accomplishment because he worked WITH the republican congress to balance the budget – and that’s not happening now. In fact, Clinton and the Republican Congress together tried more than once to pass an amendment to the Constitution making a balanced budget a law. It continually failed because of democratic “no” votes.
5 times Bill had defiet budget. Added spending. Bill had no choice. I believe that is well said.
Did he sign it , yes. So you are right
There was an excellent article in CQ (Congressional Quarterly)on how the President and his cabinet have their fingerprints as EARMARKS IN THE OMNIBUS BILL.It was dated 26 February 2009 entitled “President’s Inner Circle Has Earmarks in Omnibus” and the author is Jonathan Allen. For some reason I can’t get the link up but you can still access it by going to the CQ site.
It states the Presidents name will be edited out including Biden,Clinton,Emanual and Salazar.
Babs
From other comment
“budget wars in the summer of 1995, the Clinton administration admitted that
“balancing the budget is not one of our top priorities.” ”
It was for the Republicans. They promised it if elected
DDMao
Is it normal for names to be edited out ?
Bill, if you read the article I posted you’d see that a “balanced budget” is strictly a contradiction in terms anyway. Here’s an exerpt:
The 1997 accounting year of the federal government ended last September 30, recording a budget deficit of $22 billion–not quite 0.3% of national product. President Clinton will submit a balanced budget for fiscal 1999. For all intents and purposes, the budget is in balance.
“But “balance” is a fuzzy concept. There are plausible technical adjustments and corrections to the budget that would have put it into either surplus or deficit last year. For example, treating government investments as capital expenditures to be depreciated–as a business would–would have produced a budget surplus of some $43 billion. Other technical adjustments and corrections–for example, removing the Old Age Survivors Disability Insurance and Medicare trust funds from the unified budget totals–would have pushed the fiscal 1997 budget deeper into deficit. The important thing to note is no matter what concept of the deficit one prefers, or what technical adjustments and corrections one makes, the deviation of the budget balance from zero remains too small for it to have a substantial impact on the American economy.”
As you can see, numbers on a balance sheet can be manipulated at anytime for any purpose, and whether the budget was considered balanced or not was really all just relative anyway. Maybe it was, maybe it wasn’t, it really doesn’t matter.
From other comment
“We have a balanced budget today that is mostly a result of 1) an
exceptionally strong economy that is creating gobs of new tax revenues and
2) a shrinking military budget. Social spending is still soaring and now
costs more than $1 trillion.”
——————————————————————————–
Skeptics said it could not be done in seven years. The GOP did it in four.
………………………………………
I conceed to what you said
Bill………..No it’s not a common practice.They say in the article that they are going to remove the Presidents name and his cabinet members and just leave in the other sponsers of the bill names. This way it looks like they had no part of the earmarks
DDMao
I’m doing something else, I won’t read til later. I guess this is PORK, although there is no PORK ?
DDMao
If I read right article, at the end it said something like…”lots of weight on it”. Can’t say PORK, huh
Bill,
For clarification on Dave Ramsey speaking against debt, here is his philosophy. Dave simply believes that unless you can pay cash for it, you probably can’t afford it. He advises people to save up and buy things, not simply take out loans or use credit cards. He deals with people on his radio and tv show who have lots of debt and just kept piling on the payments and are now stretched too thing.
Congress and President Obama need Dave Ramsey’s plan! Don’t buy it if you can’t pay cash for it! What a crazy concept!
You should read more about him at http://www.daveramsey.com
For investing, he Dave not play single stocks because you’re not diversified enough. He simply advises people to invest 15% of their income into a mix of mutual funds once they’re debt free, excluding their mortgage if they have one.
Here are Ramsey’s “baby steps,” as he calls them, for the road to financial peace:
1) $1,000 to start an Emergency Fund
2) Pay off all debt using the Debt Snowball
3) 3 to 6 months of expenses in savings
4) Invest 15% of household income into Roth IRAs and pre-tax retirement
5) College funding for children
6) Pay off home early
7) Build wealth and give! Invest in mutual funds and real estate
Dave is heavily for personal responsibility and absolutely NOT relying on the government to solve your problem or pay your bills.
He is also a devoted Christian and takes his financial teachings straight from the Bible.
Conservative Gal
So I was right ? You pay off your debts first. Pay off bills first. Have cushion, etc. Then invest. I knew it had to be that way. But Babs was insistant.
Am I saying it right ?
Thanks
CG
Says not to invest until you complete first three steps
Yes, Dave advises that you not invest until you’re debt free but the house because he believes you’re not making any headway then. If you double up on payments and get rid of debt, you can then double that into your own retirement and build it very quickly.
His big thing is having the emergency fund of $1,000 and then eventually having 3 to 6 months of expenses in the bank. That is key because many people do fine until something happens, then they have to go in debt for car repairs, a new water heater, job loss or any other example. If you have 3 to 6 months worth of expenses in the bank, you’re set in those situations and don’t get wiped out if you have an extra $500 or $1,000 bill now and then.
Since most people have no savings or cash in the bank, this step is huge for them.
CG
I agree with Dave. That was how I was taught. I have no debt and year cushion. I only use margin so I don’t have to wait 3 days for sell trade to clear. Interest saved is profit for sure in this bad market
This market I will not trade in.
Lets see if I can get this right this time.The place to access the story I mentioned above “Presidents Inner Circle Has Earmarks in Omnibus” is :
http://www.cqpolitics.com.....0003061639
Bill, you misunderstood me. I never said invest/save 10-15% if you’re in debt up to your eyeballs. I assumed common sense would tell someone to get out of debt first. Your comment was on the 15% issue, and that’s what I addressed.
Bill Hedges Mar 5th, 2009 at 1:13 am
Conservative Gal
Is what jd says below correct. Does Dave Ramsey preach this. I was taught to invest money that you can afford to loss. I find this impossible to believe !
Investing..Use money before you pay your bills and debts ?
Babs
Notice the word….”DEBT”
Another place
“might add, most people have credit card debt. Interest has been raised by a sugnicate % recently. I just read that paying off such debt would be smarter.”
jd said..
“Finally, Dave Ramsey even Dave Ramsey said at his seminar that although the market looks grim…BUY BUY BUY and invest in the Mutual funds. If you notice he tells us to invest the first 15% of our income, FIRST… before we pay our bills and debt. Again, If obama can invest what he is and cut the budget deficit in half by his first term than he has done a good job.”
I said this
Babs
I no nothing of Dave. I was going by Conservative gal when she said
“Dave’s whole premise is to speak out against debt,”
In a very risky market with interest rates rising significately, I found the reasoning bad.
That’s just me….
Bill Hedges Mar 5th, 2009 at 2:05 pm
Babs
This dicusion for me got stated from….
CG said
“Dave’s whole premise is to speak out against debt,”
……
I want you to look each time I used word….Debt
You were trying so hard to defend jd you ignored the word …debt
I had decided you were ill yesterday. Now I know you were not
Bill, I’m sorry if I misunderstood you. But I – by no means – posted anything to defend JD. I was just commenting on Dave’s teachings and others.
Babs
I am not a baggard. I am a “day trader”. Among other things. If someone came on this site saying they were, I have 3 simple questions to ask to know if they are who they say they are. Day trading is not a gamble. Have you experience in this ? I believe you said better to go to Vegas ?
Dave I never read, but I know sound day by day economics. I knew how to develop excellent credit when I turned 18. It is necessary for life and business.
jd has debt and claims to follow Dave’s teaching. People so like to “pick and choice”
Babs, you picked and choiced, ignoring what I was saying.
Yes, you were commenting on Dave, ignoring all else.
..
Your stance on “Bill Clinton balnced budget” has simular charteristics. Maybe another day I will rxplain it. Except to say the source of your link is Federal Reserve of S.F..? Would they tend to “not” want to put bad light on President ?
However, I’m not getting into this now.
In conclusion. I am disappointed. That’s my problem
DDMao
I read your link. Plan on re-reading later. Shifting names and definitions means only one thing to me..COVER UP. Thanks for sharing your link
Babs Mar 6th, 2009 at 10:21 am
” Your comment was on the 15% issue, and that’s what I addressed”
Show me where..I.. discussed 15 % issue ? I don’t remember nor see it on this article
As Conservative Gal pointed out (in the past) about Capitaism and home sales, when price is right market corrects the problem. Hopefully o will not interfer, as government did in past that caused sub-prime fiasco. But he is !
“Prices have dropped so low that cash-ready investors and first-time buyers are making multiple offers on distressed properties. Fairfield sales jumped 226% in the fourth quarter of last year compared to the same quarter in 2007 and home prices during that period fell 19% to $179,500, according to mortgage and housing data analytics company First American CoreLogic”
“Signs of Life From the Real Estate Market”
http://www.businessweek.c.....;lifestyle – 51k -