EU Daily | European Construction Output Declined for Fourth Month


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European Construction Output Declined for Fourth Month

Domestic housing markets still weak.

Eurozone officials say they support strong dollar

I’m sure they do- they are hoping to export their way out of their recession.

EU Ministers Agree to Start Cutting Deficits in 2011

Back to their old formula- tight fiscal to keep deflationary forces at work on labor costs, to support exports.

Except that formula requires the govt to sell its currency and buy dollars, like Germany and the rest used to do,
to keep relative costs low enough to support exports.

ECB’s Bini Smaghi Says Doesn’t See ‘Any Risk’ of Inflation

Right, the deflationary forces are so severe the ECB actually hit its inflation target for the first time since inception.

German September Producer Prices Decline on Cheaper Energy

It’s not a weak dollar, it’s a strong euro as the eurozone continues to deflate.

Bundesbank Says Germany Continued Recovery in Third Quarter

Like the US, gdp stopped falling while increased productivity keeps employment from increasing.

Merkel in stand-off over tax cuts

They need to cut taxes, increase spending, and at the same time cut the deficit.
Haven’t figured out how to do that yet.

Germany Mulls Fund to Ease Labor, Health Budget

France’s Woerth May Roll Back Tax Deductions

They haven’t figured out how to do it either.

German Bonds Advance as Stock Declines Stoke Demand for Safety

Stock declines reduce chances of rate hikes


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Home-Buyer Credit Is Focus of Inquiry


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>   
>   (email exchange)
>   
>   On Tue, Oct 20, 2009 at 12:13 AM, Russell wrote:
>   

Reference article:

Home-Buyer Credit Is Focus of Inquiry

>   
>   The Internal Revenue Service is examining more than 100,000 suspicious
>   claims for the first-time home-buyer tax break …
>   
>   The tax credit is completely refundable, even if the homebuyer has no tax
>   liability – and this makes it a target for fraud. From the IRS:

Link

>   
>   ”[The tax credit is] fully refundable, meaning the credit will be paid out
>   to eligible taxpayers, even if they owe no tax or the credit is more than
>   the tax owed.”
>   
>   Also, the credit is separate from the closing, and the WSJ article suggests
>   this is contributing to the “widespread” fraud.
>   
>   Bonnie Speedy, national director of AARP Tax-Aide … suggested that abuse of
>   the home-purchase credit appeared to be widespread …
>   
>   And – not mentioned in the article – the homebuyers are required to pay back
>   the tax credit if they do not own and live in the home for three years … so
>   there will probably be more fraud in the future. More IRS:

Link

>   
>   The obligation to repay the credit on a home purchased in 2009 arises only if
>   the home ceases to be your principal residence within 36 months from the date
>   of purchase. The full amount of the credit received becomes due on the return
>   for the year the home ceased being your principal residence.
>   

Right, critical parts of any legislation include compliance/enforcement.

All of my proposals look to reduce real compliance and enforcement costs, and to minimize the potential for fraud.

For example, the payroll tax holiday has none of those issues, nor does it place any demands on govt.
Same with the per capita revenue sharing. The main risk is States that may somehow inflate their population estimates, but that is trivial, and the distributions are done on past estimates.


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