2 edits | reply to jester121
Re: Cotton: The cost of printing money. said by jester121:I implied it, you failed to infer it. No matter which generation words have meaning.
Vocabulary is almost as important as reading comprehension.
We're way off topic here, so I wish you a good day and nice weekend.
What prevents someone from writing themselves a $.23 check and cashing it for $.25? What prevents someone from writing 10,000 of those a day and cashing them? Each separate transaction would net a $.25 coin with a $.23 check. Are banks or anyone else willing to take that kind of hit? We're talking millions of dollars in losses a day with millions of transactions across the nation with billions of customers. I guess you just ignore the implications of a multi-penny rounding system? Just in my multi-billion dollar company we'd be taking huge losses with a multi-penny rounding system. Does that loss come from the government to make up? Do we re-do all taxes from state to federal in an effort to round everything in life to a whole of 5 to avoid the loopholes of a multi-penny round system?
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"Rule No.1: Never lose money. Rule No.2: Never forget rule No.1." -Warren Buffett |
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davePremium,MVM
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| said by Midgard:What prevents someone from writing themselves a $.23 check and cashing it for $.25? What prevents the bank from taking $.25 out of your account to cover the $.25 they had to hand to the payee? |
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 VoxxjinCool Blue TrollPremium
join:2010-01-13
San Antonio, TX
 ·Time Warner Cable
| reply to Midgard
I understand why people want to get rid of the penny. And I understand why some want to keep it. However I wish first of all that prices were 'normal' even numbers and not the $.99 or .98 or .95 stuff. There was a pizza delivery place in AZ that had weird prices but once tax was added, the total would be round whole numbers.
Anyways what about the other option of loping off the last digit off everything? So something that had cost $10.00 would now cost $1.00. Redenomination.
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| reply to dave
said by dave:said by Midgard:What prevents someone from writing themselves a $.23 check and cashing it for $.25? What prevents the bank from taking $.25 out of your account to cover the $.25 they had to hand to the payee? Do they put your account in debt aka overdrawn then if you have .23 cents in your account and write a check to yourself for that amount and get .25 in cash? How does a store handle that? You buy some combo of stuff that will round up .2 cents and do that every time you purchase anything just to get the free money. Millions of other American's are doing the same thing. How does a store handle that? They can't put your account negative since you don't have an account. Eventually maybe someone will have an intelligent answer for me I'm praying.
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davePremium,MVM
join:2000-05-04
not in ohio
kudos:7 | I'm not seeing this as being particularly different from me writing a check for $3.799 to pay the advertised price for a gallon of gas. |
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| said by dave:I'm not seeing this as being particularly different from me writing a check for $3.799 to pay the advertised price for a gallon of gas.
Let's see:
$3.799 rounds to $3.80 if you get a gallon so the gas station makes a small amount of extra money vs. cashing a $3.23 check and receiving $3.25 in cash so the financial institution loses 2 cents on the transaction. Nope, I don't see anything particularly different there with nickle rounding. Let me refer back to the last statement I made in the last post. Eventually maybe someone will have an intelligent answer for me I'm praying.
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"Rule No.1: Never lose money. Rule No.2: Never forget rule No.1." -Warren Buffett |
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1 edit | reply to Midgard
said by Midgard:said by jester121:I implied it, you failed to infer it. No matter which generation words have meaning.
Vocabulary is almost as important as reading comprehension.
We're way off topic here, so I wish you a good day and nice weekend.
What prevents someone from writing themselves a $.23 check and cashing it for $.25? What prevents someone from writing 10,000 of those a day and cashing them? Each separate transaction would net a $.25 coin with a $.23 check. Are banks or anyone else willing to take that kind of hit? We're talking millions of dollars in losses a day with millions of transactions across the nation with billions of customers. I guess you just ignore the implications of a multi-penny rounding system? Just in my multi-billion dollar company we'd be taking huge losses with a multi-penny rounding system. Does that loss come from the government to make up? Do we re-do all taxes from state to federal in an effort to round everything in life to a whole of 5 to avoid the loopholes of a multi-penny round system? hmm - well what prevents it depends on how the legislation is written.... aside, of course, from the practical fact that:
a) many (most?) americans do not enjoy free checking {so the bank is making a sizeable fee on a .25c check......}
b) those that do enjoy it would swiftly see it withdrawn if they started issuing large numbers of micro value checks.....
the most recent (2006) failed legislative attempt to (de facto*) abolish the penny handled it thus:
quote:
(a) Rounding of Cash Transaction Values to Nearest 5 Cents Required- Notwithstanding any other provision of law, any person selling goods or services shall determine the total cash transaction value of such goods or services in the following manner:
(1) TOTAL TRANSACTION VALUES- The transaction values of goods and services shall be totaled, any discount or deduction therefor made, and sales tax or other tax imposed, if any, added to that total in accordance with the law of the State in which such goods or services are sold.
(2) ROUNDING-
(A) ROUNDING DOWN- If the resulting sum ends with 1 cent, 2 cents, 6 cents, or 7 cents as the final digit, the amount of cents in the sum shall be rounded down to the nearest amount divisible by 5 for those individuals seeking to make payment with legal tender.
(B) ROUNDING UP- If the resulting sum ends with 3 cents, 4 cents, 8 cents, or 9 cents as the final digit, the amount of cents in the sum shall be rounded up to the nearest amount divisible by 5 for any person seeking to make payment with legal tender.
(b) Exception- The provisions of subsection (a)(2) shall not apply to--
(1) transactions the total amount of which is 2 cents or less, or
(2) transactions for which payment is made by any demand or negotiable instrument, electronic fund transfer, money order, credit card, or other like instrument.
(c) No Effect on Legal Tender- All coins and currencies of the United States, regardless of when coined, printed, or issued, shall continue to be legal tender for all debts, public and private, public charges, taxes, duties, and dues, in accordance with law.
»www.govtrack.us/congress/billtex···109-5818
i.e. anything paid for by a check would never have been rounded.....
his 2001 attempt adopted the same solution
»thomas.loc.gov/cgi-bin/query/z?c···.R.2528:
*it would have left pennies still legal tender, just unusable to buy goods/services except in batches of five...... and no more money would be wasted making new ones....
edit: i.e. basically Kolb's bills would create a scenario where a cash buyer pays a whisker more than a check/card payer on transactions ending in 1,2,6 or 7 cents.... but a whisker more than the non-cash buyer on those ending in 3,4,8,9 cents...... those selling low value goods would therefore be likely to adjust their pricing to either avoid it entirely (by pricing in multiples of 5c) or perhaps try to generate increased volume by the expedient of pricing ending in 4 or 9 (leaving a cash customer needing to buy 3 items to get maximum benefit from rounding - to the tune of a whole 2c i.e. under 1c per item...) - i.e. it's quite likely i think that the $X.99 price would remain moderately widespread..... |
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4 edits | said by pauldenton:a) many (most?) americans do not enjoy free checking I know it's too much to ask but when you don't know something don't make shit up that's just plain untrue. Most American's do enjoy free checking with absolutely no fee's to write and cash checks. They might have a monthly fee to have the checking account but nothing per check with unlimited checks a month possible at no extra cost. Where you once living the states here or are a US citizen abroad? Your knowledge of the system as it stands now is outdated or completely inaccurate.
Here's a new scenario for you guys I'd do given it being withing the new rounding law as proposed above. I'd open a company. I'd buy something from the company at a price that rounded up .2 cents like $.13 so it rounded to $.15 then mark it as a cash transaction in my books since I can move cash from my left hand to my right hand pretty easy. Now your saying I haven't made any money because I took $.13 of my own money and then gave myself $.15 in return so I've lost .2 cents. That's the idea. Now I have a loss to report on my taxes next year for a gain. I've got investment money to write off as well as losses to write off. I didn't lose any money really since I control the company and the money. The cash just keeps moving between myself and my company to create a loss to write off on taxes. Your not going to get rich that way but you can easily rake in 5 digits if you work full-time by reducing your tax liability to zero annually legally. If you set this up for others and do it for them you can charge them a fee or percentage of their return and indirectly make money by saving others money. You could get rich off it if you really wanted too. I'm a STRONG supporter of getting rid of the penny!
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"Rule No.1: Never lose money. Rule No.2: Never forget rule No.1." -Warren Buffett |
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| said by Midgard:Here's a new scenario for you guys I'd do given it being withing the new rounding law as proposed above. hmm - you appear to have completely understood the (past) legislation's affects.... see below
said by Midgard:I'd open a company. I'd buy something from the company at a price that rounded up .2 cents like $.13 so it rounded to $.15 then mark it as a cash transaction in my books since I can move cash from my left hand to my right hand pretty easy. the only options you and your company have under the legislation are:
a) buy the widget from your company for cash - at a price of 15c - entered into the books for 15c - no "loss" results and the company has made whatever profit it "usually" makes on the item at 13c plus another 2c......
b) buy the widget from your company for credit/check/whatever for 13c - entered into the books for 13c - the company has made whatever profit it "usually" makes on the item at 13c
in the contrary scenario where the price rounds down - eg if the price was 12c then a) is replaced by:
c) buy the widget from your company for cash - at a price of 10c - entered into the books for 10c - the company has made whatever profit it "usually" makes on the item at 13c less 2c...... if the cost price of the widget was, say, 12c or 13c then the company will make a loss on the sale, but you still don't have a loss
said by Midgard:Now your saying I haven't made any money because I took $.13 of my own money and then gave myself $.15 in return so I've lost .2 cents. err - no you haven't - your company took 15c of your own money from you and gave you a widget in return.....
neither you, nor your company, has "lost .2 cents"
said by Midgard:That's the idea. Now I have a loss to report on my taxes next year for a gain.
nothing in your scenario as expressed gives rise to you having a loss to report in your taxes
even if "you" are using the widgets for a business purpose "you" have still got to record them in "your" books at a cost price that is the "transaction value" the law demands of you......
if your not-very-well-detailed scheme is what i think it is {that "you" recycle the widgets by selling them back to your company for 13c each - paid by check/transfer, paid out of the cash once it is deposited in the company's bank account} then the result of your scenario is that:
i) "you" make a loss of 2c per widget but your company makes a profit of 2c per widget {less whatever fees if any it has to pay it's bank for making cash deposits..}
i) a) if your company is an "S corporation" (or an LLC that has not elected to be treated as a C corporation) then that equal and opposite profit is attributable to you anyway and at best you gain no benefit from it on you tax returns {and have basically just thrown away the legal and administrative costs (plus any corporate banking fees) required to set up the company and operate the scheme - i.e. it leads to you being out real money and only those charging you for the work involved are ahead  }
i.e. at best the only "loss" that this scenario generates is the real one caused by the overheads - and i fail to see any benefit in reducing your tax bill by (at most) 35c (plus any state tax) for every $1 of real money you lose in overhead -
ii) b) if your company is a "C corporation" (or an LLC that has elected to be treated as such) then it will face a separate (state plus federal) tax bill on it's profits - at the US's swinging corporate tax rates:
$ to $
0 50,000 15%
50,000 75,000 25%
75,000 100,000 34%
100,000 335,000 39%
335,000 10,000,000 34%
10,000,000 15,000,000 35%
15,000,000 18,333,333 38%
18,333,333 .......... 35%
since these hit 39% at a level of profit where even a single taxpayer would only pay 28%, the "best" that one might hope for i think is to turn, say 75k of personal income taxable at 35% to 50k of corporate income taxable at 15%, and another 25k taxable at 25%.....
and in both cases that's only if you can successfully persuade the IRS that "your" inevitably loss making personal widget business is a genuine business activity operated for profit...
quote:
This chapter covers the general rules for deducting business expenses. Business expenses are the costs of carrying on a trade or business, and they are usually deductible if the business is operated to make a profit.
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Not-for-Profit Activities
If you do not carry on your business or investment activity to make a profit, you cannot use a loss from the activity to offset other income. Activities you do as a hobby, or mainly for sport or recreation, are often not entered into for profit.
The limit on not-for-profit losses applies to individuals, partnerships, estates, trusts, and S corporations. It does not apply to corporations other than S corporations.
In determining whether you are carrying on an activity for profit, several factors are taken into account. No one factor alone is decisive. Among the factors to consider are whether:
*You carry on the activity in a businesslike manner,
*The time and effort you put into the activity indicate you intend to make it profitable,
*You depend on the income for your livelihood,
*Your losses are due to circumstances beyond your control (or are normal in the start-up phase of your type of business),
*You change your methods of operation in an attempt to improve profitability,
*You (or your advisors) have the knowledge needed to carry on the activity as a successful business,
*You were successful in making a profit in similar activities in the past,
*The activity makes a profit in some years, and
*You can expect to make a future profit from the appreciation of the assets used in the activity.
»www.irs.gov/publications/p535/ch01.html
since you loss here is entirely due to factors within your control, and you have no past record of profitability to rely on, i [understatement]very much suspect[/understatement] the IRS will regard your personal widget trade as being operated "not for profit" and therefore the "loss" you've gone to a great deal of effort to generate would not be offset able against your other profitable business activities...... hence it's quite likely your scheme generates a higher tax charge for you (via a pass through entity) or your company (if not pass through) whilst not generating any loss that is usable for you
{NB nothing magical in the "abolition of the penny" creates any new opportunity for (doomed imho) tax avoidance in this way that you couldn't already engage in by buying and selling with a captive corporate entity at a price that generates an automatic loss for yourself personally and a profit for a corporate you control...} |
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 bombadillHonest it just fell apart in my handsPremium
join:2008-11-10
australia
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| reply to Snakeoil
Disappointed nobody thought of using hemp paper. 
Smoke a toke; pay for it with the stalks (as paper). 
Now THAT'S value adding.  |
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 J E F FWhatta Ya Think About Dat?Premium
join:2004-04-01
Kitchener, ON
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| reply to Snakeoil
said by Snakeoil:I heard on the radio that the cotton commodities have been doing really well. So well in fact that it's become to expensive for the US Treasury to print 1 dollar bills. The director would like to stop, and in it's place mint a 1 dollar coin.
My problem with a 1 dollar coin is the added weight in my pocket. Also how large will the coin be? I remember some of the dollar coins were just a shade bigger then a quarter, making it easy to slide then into a vending machine in place of a quarter.
But also, I think it's a good idea, as coins are more durable. Now if they'd stop making pennies. But that will take a lot more thinking..
Yeah, Canada has had $1 coins for how long? 24 years? The weight isn't an issue. Goes nicely into the cup holders in car. Although I prefer paper money, personally. We're currently going to be replacing all paper money $5, $10, $20, $50 and $100 with a polymer based product, supposed to last much longer. (australia uses polymer) Of course, we also have the $2 coin. They are known as 'loonies' (the $1 coin had a picture of a loon on the front) and 'toonies' ( a portmanteau of two and loonies ). You get used to it.
I agree that pennies should be done away with...oddly, about 15% of pennies around here are American....
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horsemouthPlease Clarify My CSPPremium
join:2002-03-13
canada | I am also seeing more us dimes and quarters. Keep your eyes open a 1964 us quarter is worth about $7.00 just for melt value.
My only guess for this is that people were saving them for a trip but now with the high Canadian$ they are spending them in Canada.
»www.coinflation.com/ |
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J E F FWhatta Ya Think About Dat?Premium
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Kitchener, ON Reviews:
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| said by horsemouth:I am also seeing more us dimes and quarters. Keep your eyes open a 1964 us quarter is worth about $7.00 just for melt value.
My only guess for this is that people were saving them for a trip but now with the high Canadian$ they are spending them in Canada.
»www.coinflation.com/
At the rate the US currency is going, retailers in Canada are going to start getting pissed off if too many coins (US) start appearing everywhere...and I agree, have received a lot more change that consists of US nickels, dimes an quarters...
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If you can't explain it simply, you don't understand it well enough. - Albert Einstein |
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