Something has been sort of bugging me, and today I ran some numbers to verify that I should be concerned. I noticed after I changed my marriage status from SINGLE to MARRIED after getting married last year, that my take home pay increased.
I didn't add any allowances from what I'd filed with when I was single. Nothing else changed, so I'm confused as to why the withholding rates suddenly change. I verified today that in years past, they took out about 18-20% in federal withholding. I'm making the same as last year, yet it's only around 14%. Yet, somehow I have a hard time believing that I'm going to pay less taxes.
My wife's withholding is even worse. She makes less, and for last year, they took out about 15%. Now, they're barely taking out 5%. What the heck???????
This shouldn't affect us too much, because when I noticed the increase, I started simply taking the 'extra' amount in my paycheck and putting it into savings. I figured I'd just combine that with whatever return we got to get our 'total 'return, and it wouldn't end up too much differently than what we got as a total refund last year.
Still, this seems rather dangerous to me, because it seems to me that a couple that didn't save that 'extra' money might spend it and end up owing money to the government come next April 15th.
Am I missing something totally obvious here?
After another brutal day on Wall Street, the question will surely be raised as to what the U.S. government should do next to try to stop the bleeding and the meltdown that is occurring day after day.
That's right. Nothing. No more interest rate cuts. No more providing additional loans or credit to banks. No more bailing out insurance companies. No more promising to buy risky debt. Nothing. Zip. Nada. Zilch.
Because nothing they have done so far has worked. The government has tried tactic after tactic to try to calm the markets, but it isn't working.
These investors that are hitting the panic button have it in their heads that they need to drive the market down day after day. No rate cut, bailout, insurance company rescue, or anything else seems to stop them from panicking. They've made that clear.
So, I say let's just stop trying.
My opinion is that these 'traders' who are choosing to let hundreds of billions of dollars disappear from our economy every day are the equivalent of crying babies.
When a baby cries, you can do many things to try to make it stop crying. You can feed it. You can change its diaper. You can rock it. You can give it a pacifier or a rattle. Most times, these things or others will make the baby settle down and stop crying. But, not always. Sometimes a baby is just going to cry no matter what. In those cases, you have to make the decision at some point to just let the baby cry itself out until it's done.
Basically, these traders driving the market down are the babies of our economy right now. The government has fed these babies (bailout), changed their poopy diapers (interest rate cut), given them their rattles (extended additional credit), and everything else that you provide to a crying baby.
But, these babies have made it clear that they just need their time right now to cry. And cry they will.
So, I say let them cry. Let these sellers bawl their little eyes out. Let them sell and think that they're accomplishing something. Let them wail at the top of their lungs until they can't wail anymore. Eventually, just like a baby, these sellers will tire themselves out. And they'll quit crying.
Then, and only then, the government can get back involved. At that point, maybe the investors will appreciate the steps being taken to try to calm the waters. But for now, there's no appreciation.
Only the sound of babies crying.