#but 2017 stayed neutral throughout and then 2018 started bad ended good

[nicaninetynine]

I’m a bit sad today..

Sad, because the game that introduced me to friends online has also made me realize that not all things stay the same. Ragnarok Online unlike any other online games I’ve played, makes me really happy. Emphasis on the really because it really does. It wasn’t the first online game I’ve played but it was the first game that I truly fell in love with. Cheesy, huh. I’ve been through a lot - winning small events, invested so much time and even money, got hacked, scammed and even got my heart broken. But I was sure that it was because of all these experiences that I felt that my social life was very alive even if I was just in front of the computer. I met friends from this game. The reason why Ragnarok Online is a game that I constantly come back to is because of my friends. I met my friends for almost 8 years in our country’s official server back when we were young and were still in what we call “jeje” stage. I could only provide a short description here, but these friends namely Jen, Lisha, Aica, Kring and Ella (we lost contact a few years ago) were the people I never thought I’d share an 8-year friendship with. What makes it fun is that even when RO’s official server in the PH closed down 3 years ago, we still played the game through different private servers. It’s just sad that most of the private servers we played eventually closed down too.. but that isn’t strong enough to stop playing the game we enjoy.

I’m grateful to the Lord that He has given me friends likes them even if we don’t always communicate (busy lives IRL lol). I’d also like to thank the owners of Facebook and Discord for creating instruments of communication (HAHA). Anyway, the real reason why Ragnarok Online also made me sad is because it is where I saw how my friends transitioned to a “regular gamer in the game” to “busy with real life” kind of person. I might be exaggerating because my friends and I still play the game but I always get the feeling that it wasn’t like before - that we might have reached the point that we’d go into our own separate ways. It isn’t THAT major actually. I think I am just exaggerating (seriously). But seriously speaking, I guess we just can’t control that. I have RO friends who are able to play the game while busy with work/studies. That’s great and all but when I think about the future, I realize that it won’t be the same. My friends and I might meet opportunities in real life with regards to their career paths.. even love. Get what I’m saying? We might have played War of Emperium in different private servers, collected costumes and headgears, helped each other with equipment sets, fangirled when seeing a hottie player (hehe), meeting each other in real life or just simply sat and did little chit-chats in the area we that we became friends -- Payon Forest BUT who knows what the future holds? As we grow older, we realize that Ragnarok Online has always been a part of who we are but we just can’t stay in it forever, can we? That thought scares me.. That we would arrive to the point that we have to bid our goodbyes to each other because we have bigger responsibilities and opportunities but at the same time, thanking them for the great x years of friendship. In simple terms, that we might permanently stop playing the game.

Ragnarok Online wouldn’t be Ragnarok Online if it weren’t for all the experiences and memories made with our friends. We might live a hundred or a thousand miles apart (I’m the farthest tbh. We have friends abroad but in the PH, I’m the farthest from my friends living here in the country), but thanks to internet connection and mobile data, the 8 years of playing felt like my friends were just like real life friends. Throughout the 8 years, I have not only met the 5 friends I mentioned earlier. I call it “group”, this “group” has grew by meeting different people in both official and private servers.

 ~TIMELINE~ OF THE GROUP! 

2010-2011: Firsts

 I was part of this “group” called Tropang Payon Forest (TPF), the first word is in Filipino which means Tropa or Friends in English so it’s like Friends in Payon Forest. I think they already existed even before 2010 (the year I first played Ragnarok Online) and by that time Payon Forest was filled with people but some people stopped playing by 2011. I temporarily stopped playing around January 2011 and played again on October of the same year. When I came back, Payon forest was empty. January was still filled with people summoning monsters from dead branches! Wth. It was then I discovered that some players migrated from Payon Forest to Prontera Field! These two maps share something in common: They are both located south of Payon Town and Prontera respectively. I visited Prontera Field, it became a place where I could spend my time AFK-ing but the people there weren’t the same people in Payon Forest - my friends quit the game. I don’t know why because I kind of “left” my friends back then. I got really sad because my account got hacked and even got my friend’s item stolen. 

2011-2012: Reunion

 By this time, I got in touch with some of my friends (Jen and Lisha). I deleted my RO friends when I quit in 2011 because I did not want to be reminded of the game anymore so I added them again when I played again until news spread and my friends played the game again. It was also this time that I first played a private server with them! I also met additional TPF friends, Erika and Nald.

2013: Private Servers again

We played a private server but I had to temporarily stop playing because I was busy with school. In a certain server (Fatal RO), Lisha and Kring who stayed active made friends there. These friends, we still communicate with them from time to time even played with them around 2016-2017. Hello to the friends I made here even if I was inactive. Hi Ronnie! There were some others but I actually never got to become official friends with them, it happened in 2016 though.

2014: Official Server

Ever since school became busier, I only played during summer vacation, semestral and Christmas breaks but if my memory serves me right, we played in the Official server during this time.

2015: Busy, Official server closed down

We got really busy and inactive but I wasn’t that sad because we still communicated with each other through social media.

Late 2015: New Private Server

A friend of ours made a private server so we decided to play RO again. Negative RO was the name. I stopped playing because of school around January 2016.

2016: FO

Not finger offensive but friendship over. A LOT happened during this year. I still play during vacation, when I came back March 2016, my friends had really strong equipment now. Their guild was really strong and I was kinda left out (HAHA). Good thing my friends were there to help me so I was able to join a few wars. The best WoEs happened when I wasn’t around (daaamn it), so when I came back there were a few people because apparently, my friends’ guild always had the advantage of beating them. I think the server only had two guilds left playing and this was where friendships started to fall. I hope nobody from TPF/Fox reads this because I’m going to narrate bits of a conflict  that appeared out of nowhere.

NOTE: My narration will only be one of the things that have caused problems between the persons involved. I don’t have the best memory out there and I will narrate only what I remember correctly!

My friend, L was the guild leader of Fox (our guild) and there was a time that she could not play in a certain WoE night. She passed the guild leader position to S, a good player in my opinion but S had a poor connection so he wasn’t able to play properly. J, got disappointed and thought that the guild leader position should have been passed to someone else (I think L liked S and also thought that S had the potential to lead the guild) but J was still upset. Bla bla bla I was busy with school and then a notification from Messenger showed up. A new group was made without L. This was another guild but had the Fox members in it except for L. I felt bad for L so I stayed with her for a while, we were both in a guild led by her friend. I was still busy because of school that time so I still wasn’t that active, I even hoped that J and L would fix the problem. It didn’t happen. Things even got worse (won’t narrate them because I might write wrong information because my memory isn’t that good especially when it comes to things like these lol + read NOTE above). When school ended, I played again. I decided to play with the new guild so L also became an enemy in WoE. I think I was neutral at that time(?). I wanted them to be friends again. 

The private server also closed down without them being friends again. L still plays with us when she isn’t busy until now.

Problems aside, I also made friends with people I should have met if it weren’t for me being inactive for sooo long. Will greet them through the letters of their first names. Haha. I’m too shy to actually greet them loool. Basta yon. If ever one of you reads this (super duper low probability of ever happening), I included short descriptions of how we met OR a random description about you! Hi to my good friend Z which I talked more in iRO, Japan friend G, Digital artist D, cousin of a classmate of mine J, became friends because I adopted him c, cousin of the person before this N, ROPH friend M, event gm I, love of the life of a friend of mine E, and another gm R. 

Late 2017: New Server again

I was in 12th grade, graduating actually. I became really busy by this time! My friends played another server. They were all there but I wasn’t because I was super busy with school as usual. I became friends with R also a Negative RO player and RoS master A. I was too late for all the action. When I played, there were two guilds left playing! Whew.

2018: The present

Who would’ve have thought that we’d come this far? It has been 8 years since I played Ragnarok Online, met different people and had my own share of good and bad memories. As I type this super long composition, I only hope that our future may be good for each of us. Ragnarok Online isn’t the only game that we are playing now, there are many to mention! Just kidding. I’m sad that we might not play Ragnarok Online in the future anymore but I’m happy to have come across people who turned into friends that I can keep in my lifetime. Very cheesy. Masyadong OA, I tell myself. But friends or companions are one of the main factors to be able to keep playing a game. Playing becomes really boring when your friends don’t play with you anymore and I’m really happy and thankful that my friends have stayed the same fun people I met when I first talked to them. Lord, I cannot thank You enough! You have given me the opportunity to meet all the other people I’ve met in Ragnarok Online. I hope we cross each other in private servers again because I miss playing with everyone. I know we just recently played a private server but I have to focus on my responsibilities too. 

All the love, 

Mon

#personal #ragnarokonline #ragnarok online #ragnarokph #mmorpg

[sportsleague365]

With one year of collegiate eligibility remaining, former Florida Gators quarterback Feleipe Franks decided after the 2019 season that he would choose to play elsewhere. Monday night, Franks made his transfer destination official when he announced on Instagram that he will continue his career with the Arkansas Razorbacks. The move is a curious one for Franks considering he is not only staying inside the SEC but moving to a team that just completed a 2-10 (0-8 SEC) season and hired an offensive line coach in Sam Pittman as its head coach. It is unknown how many suitors there ultimately were for Franks’ services, but considering this is his last season before he presumably hopes to make it in the NFL, he is putting a lot of eggs in the basket of offensive coordinator Kendall Briles To be fair, Briles did help FAU’s offense win the program a Conference USA championship in 2017, and he again succeeded at Houston in 2018. But he had a rough go of it at Florida State under Willie Taggart, and the Arkansas playmaking talent is not necessarily next-level. After his injury, Franks was replaced as Florida’s starter this year by Kyle Trask, who became the first Gators quarterback since Tim Tebow to throw for 300+ yards and 3+ touchdowns in three or more games in a single season. The rising redshirt senior is expected to return as the starter in 2020, though rising redshirt sophomore Emory Jones will provide immense competition this spring. No matter who starts next season, both will likely see significant action throughout the year. This officially marks the end of a turbulent career for Franks at Florida. A heavily-recruited four-star prospect who was not projected to start until his third year with the program, injury thrust Franks into action as a redshirt freshman in 2017. He completed only 54.6 percent of his passes and posted nine touchdowns to eight interceptions, losing six straight games late in the season. The hiring of head coach Dan Mullen was expected to be a boon for Franks in 2018, and after he got off to a rocky start that led to fans calling for his ouster as the team’s starter, he recovered to put together a tremendous end to the season. Franks started the year 6-1 with two top 25 victories but did not look particularly good in those games. Consecutive bad losses to Georgia and Missouri (the latter on homecoming) led to Mullen benching Franks for Trask. However, Trask suffered a season-ending foot injury just a couple days later in practice, pushing Franks back into the starting role. Franks responded by leading a come-from-behind win against South Carolina that week. He infamously “sushed” the crowd at Ben Hill Griffin Stadium with a finger to his lips twice in that game, which bothered some but to most showed a renewed confidence and mindset. That carried over to Florida’s final three games of the season where it put forth dominant efforts. The Gators outscored their last three opponents 145-39, ending a seven-game losing streak to Florida State and blasting Michigan in the Peach Bowl. Franks completed 63.2 percent of his passes and scored nine total touchdowns with no interceptions in those games. He ended the year with 31 total touchdowns and six picks, eye-popping totals and the best Florida had seen since Tebow. The 2019 season started well enough for Franks as he was completing 76.1 percent of his passes and won his first two games, but he committed two costly turnovers in the opener against Miami and was struggling mightily on the road at Kentucky in Game 3 before suffering his season-ending injury. Trask entered that game and led the Gators to 19 unanswered points on three fourth-quarter touchdown drives. Trask went on to complete 66.9 percent of his passes for 2,941 yards, 29 total touchdowns and seven interceptions this season. After getting over some fumbling issues in his first few games, Trask was exceedingly careful and commanding with the ball. His only losses came by a total of 21 points to two of the top four teams in the nation (LSU on the road, Georgia at a neutral site), and he passed for 282+ yards in six of his 10 starts while also scoring 3+ total touchdowns in five of 10 games. A return to Florida for Franks would likely have been a disaster. Not only does he have to continue his rehabilitation, which would have put him behind the 8-ball during spring practice, Franks would have needed to beat out one quarterback who won over the fan base and another who is clearly the future of the program. Even if Franks did somehow win the job, he would have been on an exceedingly short leash, which could have led to a wasted season in his final year of eligibility. Franks will be remembered as having one of the most contentious careers in program history considering the heights of his highs and the depths of his lows. His last gesture as a member of the program was a selfless one that will help the Gators long term as his quick departure before Orange Bowl practice and the early signing period — not to mention spring practice — cleared up the quarterback picture for 2020 and likely relaxed any potential angst Jones would’ve had about the bodies involved in a competition next season. #FeleipeFranks #ArkansasRazorbacks #DanMullen

#FeleipeFranks #ArkansasRazorbacks #DanMullen

[johnmauldin]

If Trump Doesn't Push Through the Tax Reform by 2018, the Stock Market May Crash

I’ve been doing a multipart series on the proposed tax reforms in Thoughts from the Frontline (subscribe here for free).

In part two, I talked about what I like about the Better Way proposal. In part three, I pretty much eviscerated the border adjustment tax (BAT).

I think it has the real potential to create a global recession. You’ll need to read the series to see why, but a lot of it has to do with simple game theory.

It holds that if you upset the equilibrium, the other partners at the table will change their strategies, too. This is a factor that the measure’s Republican proponents are ignoring.

Below is an analysis of the current tax proposal from my friend Constance Hunter, who is the chief economist at KPMG and wicked brilliant. She tries to be fair but comes up with many of the same negatives that I do (and a few more).

One of the things that Constance notes is that real, forceful change is required to get this reform through Congress. Without Democratic support in the Senate, there will be an automatic sunset provision in 10 years that would be devastating to the economy.

There needs to be a real effort to figure out how to create something bipartisan.

Again, it is not that the current proposal doesn’t have many good features. It is that the bad ones—which actually allow you to pay for the good tax cuts—go about it in the wrong way and create serious problems.

Why is this so important? Because if we don’t come up with a tax proposal that can get through Congress this year, then we’re looking at 2018; and do you really think the stock market is going to levitate, waiting until 2018 for a tax proposal that’s not even on the table yet?

Congress needs to focus clearly and figure out what they’re going to do—and not do things that would make the US and global economic situation even worse.

As investors and portfolio managers, we need to be paying attention to what Congress is saying and doing and figure out how their actions are going to affect the economy and our portfolios.

The right policies and programs could be very good for the markets. The wrong ones? You’d want to get out of the way of that train.

“Trump-O-Nomics” – An exploration of the proposals

By Constance Hunter and Jennifer Dorfman

As Donald J. Trump begins the presidency with promises of greater GDP growth and job creation, this report examines both the cyclical and structural backdrop that could impact the efficacy of his plans. The report will also discuss the border adjustable tax proposal and some possible implications. The analysis takes into account the more than 20 percent of U.S. imports that are priced in dollars, a unique situation that alters the normal currency adjustment assumptions economists make when assessing the impact of such a tax.

It is debatable how much influence presidents can have over near-term, cyclical, economic growth. Certainly expansionary or contractionary fiscal policy has some influence, but in the United States, discretionary government spending is a relatively small percent of GDP so this influence is minimal. Presidents have more influence over structural aspects of GDP via changes to regulation, changes to the tax code, and changes to total government spending and resulting debt levels.

In terms of the cyclical prospects for the UnitedStates, the recovery appears to be in about the 7th inning. The Federal Reserve Bank (the Fed) is hoping its policies can create some overtime innings and a soft landing; however, this is often the hope of central banks, yet few are lucky enough to achieve such feats. The largest constraint to the Fed’s goals is apparent tightness in the U.S. labor market. For example, the National Federation for Independent Business1 reports that the number of respondents who say there are few or no qualified applicants for job openings exceeds the long-term average of 42 percent. This suggests that even if the participation rate rose, the lack of labor market depth would still pose constraints for business expansion despite any new incentives from tax changes or other stimulative measures.

In addition to relatively tight labor supply, the Fed has just raised rates for the second time in the current cycle. Since the election, long-term interest rates have risen more than short-term ones due to anticipation of more frequent rate increases in 2017 and some possible increase in risk premia due to fiscal policy uncertainty. However, we believe the biggest contributor to higher rates is the stronger U.S. economy that was in train before the presidential election. In addition to cyclical momentum seen in jobs and consumption growth, higher oil prices are supporting a return of oil and gas investment. Our base forecast for growth in 2017 is now higher than before the election due to strong growth momentum.

Therefore,Trump enters his presidency at the end of a long, if tepid, expansion with little capacity for faster growth in the near term.

Nevertheless, during the first 100 days, the Trump administration will want to achieve some quick wins. One way to start this would be to streamline regulation. A study from the conservative think tank, Heritage Foundation2 found the cost of new regulations implemented since 2008 amount to an average of $15 billion a year spent on compliance. The argument suggests this is money not spent on generating economic activity and it reduces productivity. Even if this number is off by 50 percent, given that U.S. corporate investment has averaged $130 billion a year since 2010, even $7 billion of extra investment could add up to 50 basis points a year to investment’s contribution to GDP.

In terms of fiscal stimulus from Trump’s tax policies, it is important to remember that in addition to lower personal and corporate taxes, there are proposals that would create offsets to pay for the cuts. At the moment, Republicans are united in saying that the tax cuts and offsets are part of the same proposal and cannot be separated. Therefore, their economic impact must be assessed in concert.

There is a good reason for the insistence by many Republicans that spending not simply stay the same while tax revenue declines due to tax cuts, as this would increase our already high 102 percent general government debt to GDP levels. Here one can turn to a well-established phenomenon in economics, the Ricardian Equivalence Theorem.3 Ricardian Equivalence states that the economic outcome between debt financing and increased private spending is equal.

Or put another way, there is no free lunch. If tax cuts cause the federal debt to rise, then companies and households spend and invest less than the amount of the cut. The greater the debt level at the initiation of the tax cut the smaller the portion that is spent or invested.

The first offset is a change to the deductibility of interest. Under the current House Republican proposal 4, interest would no longer be deductible unless it could be claimed against interest income.

While this is neutral for banks, in isolation it could hurt heavily indebted industries, many private equity structures, and companies that rely on debt versus equity financing. Proponents of the tax change argue that reducing the tax benefits of debt financing would allow better allocation of capital and would normalize the U.S. tax code with the rest of the world. Nevertheless, most U.S. companies will see an increase in their weighted average cost of capital (WACC). According to outside estimates of the GOP proposal, this would raise more than $1 trillion in additional tax receipts.5 However, this change comes at a price. A November 2015 paper by RLG Forensics in association with the Association for Corporate Growth predicts that “revenue neutral” in terms of the federal budget is not the same thing as “impact neutral” in terms of equity valuations or economic impact.6 Proponents of the change argue that investment expensing and the reduction of the overall corporate tax rate to 20 percent will offset the increase of the cost of WACC in many cases. While this may be true eventually, the transition period is likely to cause lumpiness in investment spending, which could well translate into some quarters of negative growth.

The second offset, implementing a border adjustable tax, is estimated to raise $1.2 trillion in tax revenue over 10 years. One main motivation for this tax appears to be that it would discourage corporate inversions. As A Better Way7 notes, “Taken together, a 20 percent corporate rate, a switch to a territorial system, and border adjustments will cause the recent wave of inversions to come to a halt.” However, other claims that the change will now favor exports over imports ignores linkages between imports, exports, and foreign exchange values. Perhaps more importantly, if the tax changes did reduce our imports, it would also reduce our standard of living, as more goods and services would be sent to foreigners while receiving fewer goods and services from them in return.8 

Indeed the fact that in any given year 20–30 percent of U.S. imports are priced in dollars means the J-curve effects of the currency adjustment would likely take longer and could be adverse for importers of commodities in the short term. Additionally, the linkages in global value chains where many goods are priced in dollars, the long-term nature of contracts, and general price stickiness throughout the value chain mean the transition between implementation and complete currency adjustment could disrupt U.S. and global GDP growth.

Nevertheless, many economists make several arguments in favor of a border adjustable tax system.9 

It would align more closely with the VAT system in most of our trading partners where exports are not taxed but imports are.  

Border adjustments reduce the incentive to manipulate transfer prices by shifting to lower tax jurisdictions based on tax policy alone.  

Border adjustments reduce the incentive to shift profitable production activities abroad simply for tax benefits of lower tax jurisdictions commonly known as corporate inversions.  

Proponents argue that border adjustments are not trade policy, but rather create a level playing field between domestic and overseas competition.  

Border adjustments do not distort trade as exchange rates should react immediately to offset the impact of these adjustments.

Many economists agree with most of these points. We concur largely with points 1-3 and in the long run with point 5, although the implementation phase could cause disruption that may have a significant near-term impact on GDP. On point 5, the reserve currency status of the United States blunts this negative impact. Our research suggests that the reserve currency status of the United States and integrated global value chains could slow the rate of currency adjustment with adverse unintended consequences for world and U.S. growth. The stronger U.S. dollar will raise prices of dollar priced goods for the rest of the world which will, at some point, if not immediately, lower demand for these goods. No immediate adjustment will take place on the 20–30 percent of imports priced in U.S. dollars, and it will raise prices and lower demand of these goods worldwide.

Raising $1.1 trillion in taxes means that cost must be borne by some part of the economy either domestically or by trading partners. In the example below, the tax law change simply shifts the burden of the tax to different types of businesses.

Auerbach and Holtz-Eakin assume that the world price of the goods remains the same and that the dollar appreciates to offset the border adjustment. They also appear to assume that the good is priced in foreign currency and no long-term contracts or integrated value chains are in place. Economic theory suggests that the higher import tax cost in the example below does not mean that the firm does worse after tax under the new system once the currency adjustment is completed and the cost of imports falls due to the higher value of the U.S. dollar. Under the new law, the firm in the example below can deduct only 20 of its purchases rather than 30 because 10 represents the imported amount. However, as Auerbach and Holtz- Eakin’s paper explains, the import costs will adjust to be 8 in dollar terms, rather than 10, if the tax rate is 20 percent. This means that the firm’s after-tax cash flow will be the same in the two cases; 80 percent of 15 = 12 under the current system, and 80 percent of 25 = 20 – nondeductible expenses of 8 = 12 under the new system.

We worry that this assumption is a bit too neat and the real-world adjustment will be less smooth and not immediate. As the home of the reserve currency, U.S. importers have the significant advantage of never having to worry about currency price fluctuations (in particular a devaluation of the dollar) impacting the purchase cost of commodities and many other goods that are part of the global value chain. There are other advantages such as significant demand for U.S. Treasuries keeping U.S. borrowing costs lower than they otherwise would be. But the chief advantage for the purpose of analyzing the border adjustable tax is that commodities trade in U.S. dollars.

The example put forth by Auerbach and Holtz-Eakin assumes the exchange rate absorbs the tax change and the cost evaporates in currency fluctuations. The tax law change would then encourage investment as its full expensing regime makes this activity more attractive; it would also blunt the impact from the import tax. It is implicitly assumed that this greater investment will translate into greater economic activity and yield a higher growth rate. One may also assume one has a can opener.10 

Over the long term, it seems reasonable that the proposed tax law change would simplify the code, which in and of itself could allocate scarce resources to better use thereby improving GDP. However, the transition to the new system as laid out in A Better Way does raise some questions, a few of which are outlined below.

The assumption that all traded goods are priced in foreign currency is a key part of most exchange rate models that one can apply to this situation. Examples such as the Bickerdike-Robinson-Meltzer Model assume the supply and demand schedules shift downward by the same proportion as the appreciation.11 It also assumes the good is priced in foreign currency terms, which for the United States is not the case for 20–30 percent of its imports in a given year.  

The demand elasticity is not the same for each imported product so the currency adjustment on a good-by-good basis may not be equal to the tax change. Therefore, some importers would be more or less advantaged as would some exporters.  

With no offsetting tax cut, a rise in the value of the dollar would hurt exports. With the reduced corporate tax, exporters would presumably have room to lower the price of their goods in line with the amount of the appreciation of the currency. However, this transition is likely to be “lumpy” and could reduce exporters’ revenues during the transition period and beyond.  

Not all importers are engaging in corporate inversion or are importing goods because of tax reasons. Global value chains (GVCs) have become increasingly integrated. In 2011, nearly half of world trade in goods and services took place within GVCs, up from 36 per cent in 1995.12 This is due in part to labor cost differentials, in part to sourcing of raw materials, and in part to expertise in certain products and services. Thus, changing the way imports are taxed for U.S.-domiciled companies is likely to cause disruption to globally linked supply chains many U.S. multinational companies have in place.  

The J-curve effect means that there is a lag between when a currency change takes place and the physical change in imports or exports is realized in the current account balance. Usually orders that existed before the currency move have yet to be paid for, thus the J-shaped change in the trade balance immediately following a substantial currency move. A stronger dollar should increase the current account deficit over time as U.S. dollar exports become more expensive to our trading partners. Additionally, the immediate effect would be a reduction in the current account deficit. This would be an addition to GDP but it would also correspond to a significantly smaller capital account surplus and would likely negatively impact the U.S. equity market and increase U.S. interest rates, all other things equal.   

The idea of wanting to stimulate exports, reduce imports, and reduce our current account deficit ignores the other side of this accounting identity, the capital account. As Ruddy Dornbusch wisely noted, “The flow of investment and the changes in the value of real capital potentially dominate the effects of current account imbalances. A good week on the stock market produces a change in wealth that is several times the magnitude of an entire year’s deficit in the current account. Although it is true that the current account is important because persistent current imbalances accumulate, exactly the same argument can be made for investment.” A persistently lower current account deficit would equal a persistently lower capital account surplus and over time higher interest rates and lower stock market returns. Conversely, a high current account deficit means there is a higher capital account surplus and an abundance of capital in the U.S. market. This is also a function of our reserve currency status; foreign holders of U.S. dollars need to invest their holdings in U.S. assets. Therefore, one can argue that the benefit to the economy overall of running a current account deficit and a capital account surplus not only outweighs the costs, but is a corollary to reserve currency status.  

While it is commonly known that commodities trade in U.S. dollars, it is likely less widely known that much of the global value chain of intermediate goods also trades in dollars. This is in part because the U.S. consumer base is the largest in the world which reinforces the United States’ reserve currency status. If at the margin a border adjustable tax caused fewer goods to be priced in dollars, it could have the unintended consequence of pushing the U.S. dollar further from reserve currency status.

There are of course other aspects of the A Better Way blueprint that could have unintended consequences. The list above is meant to stimulate thought and improvement of the plan and its implementation.

While some theory does support the idea that it would improve U.S. GDP, there are a lot of assumptions that cannot be counted upon. It cannot be overstated that while a major tax overhaul of this kind could in the long run benefit the U.S. economy, the transition is likely to be lumpy and could even see some quarters of negative growth as adversely impacted firms or industries suffer or go out of business.

The comprehensive and sweeping nature of the proposed tax changes and the fact that they will be much more effective if they are permanent means that the GOP will want to be strategic in the way they pass the bill.

There are two options that would eliminate the need for a sunset provision. The first would require at least eight Democrat senators to sign on. This means that compromise will alter the current proposal. It also means that passage before the end of 2017 will be difficult. Reagan’s 1986 tax law change took three years to negotiate and this tax bill will take time as well. The second way the GOP could make the law permanent is the so-called reconciliation process. This is only possible if the law does not increase the deficit in any year beyond the official 10-year budget window. Some believe this is their current plan—to construct the bill in such a way to be revenue neutral or positive in years 11 and beyond. This too would require significant changes to the current law. The Tax Policy Center assumes the current plan adds to current deficit levels by $3.3 trillion over the first decade.

In the meantime, it is expected the U.S. dollar to be the most immediate asset to anticipate this change in policy over the course of 2017. Any move in the dollar will be buttressed by the interest rate differential between the U.S. and other high- grade government debt markets. Higher interest rates will put pressure on Trump to achieve GDP wins early as it will reduce U.S. exports, increase imports, and have a negative effect on GDP. Therefore, as stated above, regulatory changes are expected to be sweeping withinTrump’s first 100 days. However, even this is not a panacea as many of these changes will be seen in the energy space where the value of a barrel of oil will be just as important in determining investment levels as regulatory changes. Remember, a stronger dollar reduces the demand and price for oil in foreign currency terms, all things being equal.

Therefore, it is fair to say that Trump’s 4 percent growth target faces challenges from both structural and cyclical factors. Streamlining regulation is Trump’s best bet for a quick win on increasing GDP.

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1  NFIB, Haver Analytics 2  Gattuso & Katz, (2016) “Red Tape Rising,” Heritage Foundation 3  Buchanan, James M. (1976) “Barro on the Ricardian Equivalence Theorem,” Journal of Political Economy 4  A Better Way (2016) Better.gop 5  Nunns, Burman, Page, et al (2016) An Analysis of the House GOP Tax Plan, TaxPolicyCenter.org 6  Morris, (2015) Eliminating the CIT Deduction: Valuation Implications for Middle Market Enterprises. RLG Forensics 7  A Better Way (2016) Better.gop 8  Viard,(2009) Border Tax Adjustments Won’t Stimulate Exports, AEI.org 9  Auerbach and Holtz-Eakin, (2016) The Role of Border Adjustments in International Taxation, AAF.org 10  A can of soup washes ashore. The physicist says, "Lets smash the can open with a rock." The chemist says, "Let's build a fire and heat the can first." The economist says, "Let’s assume that we have a can opener.” Crickets. 11  Bickerdike-Robinson-Meltzer (1975), Vol 65, no 5 American Economic Review 12  Trade in value-added and global value chains: statistical profiles, WTO, wto.org

#bat #tax reform #trump #donald trump #potus trump #us taxes #us tax #us taxation #government #us government #us gov #economics #us economy #economy

[junker-town]

25 non-Warriors reasons to watch the NBA

There’s a lot more to enjoy about this league.

The Golden State Warriors are overwhelming favorites to win the 2018 NBA championship. The Warriors almost swept through the playoffs last year, and they arguably improved in the offseason. Meanwhile, we aren’t yet sure how much their top challengers improved.

Enough to truly test Golden State? Probably not.

Enough to make the season compelling? Absolutely.

In objection to the binary nature of sports commentary, we are going to completely ignore the Warriors in this preview piece, instead focusing on the 25 reasons you should be excited about the new NBA season even though the Warriors are going to win the title.

This is now a Warriors-free zone.

1. Russell Westbrook has superstar friends again. Westbrook went full Dr. Manhattan last season and was named MVP. It’s going to be fascinating to see how he adjusts to having Paul George and Carmelo Anthony alongside him. George isn’t near the offensive mastermind that Kevin Durant had been, and Carmelo has seemed to acknowledge his powers are waning, so Westbrook should still maintain majority control on that end. But George and Melo provide relief and secondary perimeter attacking points that OKC lacked a bit last season. George’s ace defense will help, too.

2. BOSSton. If you’re not giddy with anticipation to see what Brad Stevens does with Kyrie Irving and Gordon Hayward, something’s wrong. The Whiteboard Jordan helped Isaiah Thomas reach All-NBA status and made a weird, mismatched roster into art. What will he do with high-aesthetic players like dribble-master Irving and a smooth passer and scorer like Hayward? They might not be good enough to beat Cleveland, but it’s going to be fun to see them try.

Troy Taormina-USA TODAY Sports

3. H-Town. The Rockets, who were awesome last season, went and pulled Chris Paul out of a hat. CP3’s arrival will shift James Harden back to two-guard and give Houston one of the most powerful backcourt attacks in decades. Paul is known as a bit of an on-court control freak, whereas Harden is more a free spirit. Watching them feel each other out and find ways to maximize their abilities should be fascinating.

4. The Conscience Of The NBA. Gregg Popovich isn’t shutting up, and thank goodness. He offered a sermon on media day, and we can expect him to wax philosophical throughout the season. When has a coach’s media availability ever been appointment television? (Since we haven’t mentioned him yet, let’s throw a nod to Kawhi Leonard here. A masterful player who is completely mind-blowing to watch in action.)

5. You Must Be Yoking. Nikola Jokic was a revelation last season, and he’ll have the reins in Denver from Day 1 in 2017-18. With Gary Harris and Jamal Murray developing and a new co-star in Paul Millsap up front, it should only get prettier from here.

6. No More CP3s in L.A. The Chris Paul era in Los Angeles ended rather abruptly, meaning Blake Griffin is back in charge. The good news is that Griffin, when healthy, is a preternaturally gifted creator with the ball who should be able to keep feeding DeAndre Jordan lobs and open shooters clean looks. The bad news is that the best non-Warrior shooter in the business, J.J. Redick, is gone, too. But an unlocked, mature Griffin should be glorious to behold in any case.

7. Zo-Time. Let’s stay in L.A. for a minute and hang out with Lonzo Ball. Skepticism is understood: His jumper form is, uh, interesting and his pops is a menace to airwaves. We don’t know whether he’ll ever be an All-Star. But he will be fun. This is guaranteed. No one who watched his work at UCLA last season, or paid attention to Vegas Summer League, can deny this. If the Lakers cannot yet be good, at least perhaps they can be entertaining.

8. Milos Fever. Milos Teodosic, perhaps the most creative passer in Europe over the past several years, joined the Clippers this summer. It remains to be seen how much he’ll play given his defensive shortcomings and expected heavy roles for Patrick Beverley and Austin Rivers. But with a big target like Jordan running the floor, this could be a highlight reel in the making.

Photo by Vaughn Ridley/Getty Images

9. The Next Evolution of Giannis Antetokounmpo. Last season, Giannis really put everything together. He became an All-Star and perhaps the second- or third-best player in the Eastern Conference. (Once Jimmy Butler moved west, Giannis claimed that No. 2 spot.) He’s 22 years old. He’s nowhere near maximizing his potential. Giannis has become one of those players where you need to know if he’s playing any given night so you can be prepared to switch over on League Pass.

10. Stan Van Gundy Meltdown Watch. Something gnarly happened in Detroit last year. The Pistons were disappointing in total, but Van Gundy’s particular moves — paying Reggie Jackson and Andre Drummond, specifically — didn’t work out. If Detroit starts slow again, Van Gundy might flip into IDGAF mode as he did in his waning days in Orlando. While that’d be painful for Pistons fans, a mad Van Gundy is always a delight for neutral observers.

11. ROOKIES! We mentioned Lonzo already, but heavens there are some incredible first-year prospects in the pipeline. Among just the point guards we have Ball, Markelle Fultz, De’Aaron Fox, Dennis Smith Jr., and Frank Ntilikina. Jayson Tatum, Bogdan Bogdanovic and Lauri Markkanen looked awesome this summer. Josh Jackson, Jonathan Isaac, and Donovan Mitchell have high fun quotients. And let’s not even get into Kyle Kuzma ...

12. Keep Calm Like Porzingis. Having moved on from Phil Jackson and Carmelo Anthony for different reasons, the Knicks can finally commit to slowly building around Kristaps Porzingis. That’s a shift, and it will be interesting to see how Porzingis steps into the void. We still don’t know whether he’s a future All-Star or he’s a future Best Center in the League. This season will offer guidance.

13. Paul George has a superstar friend for the first time ever. Remember that PG-13 had the Pacers very competitive during the Heatles era with George Hill, Roy Hibbert, David West, and Lance Stephenson as his co-stars. Those were all plus players, and Indiana made its mark on defense, where the supporting cast excelled. But we have not seen George play with an All-Star caliber scorer outside of the weird Indy overlap with Danny Granger. Going from Jeff Teague to Russell Westbrook should be life-changing for PG-13.

14. LeBron. I mean, that’s really all that needs to be said. If LeBron is playing basketball, you should be watching.

Photo by Gregory Shamus/Getty Images

15. Peanut Butter and Jelly. LeBron lost Kyrie Irving, but he got reinforcements, too: Dwyane Wade signed with Cleveland in the middle of training camp after getting sprung from the Bulls. And their reunion is every bit as glorious from a Banana Boat perspective as you’d imagine! (The basketball perspective? We’ll wait and see.)

16. New Heatles. One of the most disappointing moments of the 2016-17 season was when the Miami Heat fell just a game short of making the playoffs after an incredible mid-season turnaround. Well, they are back. The front office retained the roster to great expense and added Kelly Olynyk. If they start the season like they finished the last one, the East had better watch out.

17. Kemba Walker. The Hornets’ watchability is directly correlated to how much Kemba is feeling himself in any given moment.

@KembaWalker ➡️ @DwightHoward #BuzzCity http://pic.twitter.com/agy4ESGlqH

— Charlotte Hornets (@hornets) October 9, 2017

18. The John Wall-Brad Beal Encore. The Wizards hit their stride last year thanks to health and camaraderie. Wall is deeply underrated as a passer and attacker; everyone knows Beal can shoot and scoot to the rim. The dual attack is really something.

19. Guards Galore! Speaking of which: The East is relatively weak compared to the West, especially at the team level. But holy smoke the East has some fantastic guards, from Kyrie and Isaiah Thomas to Kemba, Wall, Beal, Kyle Lowry, DeMar DeRozan, and Goran Dragic. If you like guard play, those early East games usually have something for you. (Just don’t watch the Knicks, Pacers, or Bulls.)

20. Isaiah Thomas might explode into flames. It’s a scientific fact: every time someone in a position of power doubts Isaiah, he gets stronger. That’s why he was so successful entering the league as the No. 60 pick. That’s why he became a 20-point scorer after coming off the bench behind Jimmer Fredette. That’s why he became an All-Star in Boston after the Suns pawned him off. And that’s why he’ll drop 50 in a game for Cleveland after Boston traded him. Provided his hip doesn’t keep him off the court too long, he’s going to be a maniac this season.

21. Boogie And The Brow. DeMarcus Cousins and Anthony Davis were thrown together with the Pelicans already in peril of missing the playoffs last year. Now they have a training camp together, plus Jrue Holiday and Boogie-whisperer Rajon Rondo in the backcourt. The Pels remain desperate for shooting, but the whole roster and organization is desperate enough to win — Davis and Cousins for their reputations, Alvin Gentry and Dell Demps for their jobs — that something magical is possible. And if something magical does not happen and the Pels disappoint ... well, that will be its own kind of magic, won’t it?

Photo by Jonathan Ferrey/Getty Images

22. Blaze On. Portland didn’t solve its major roster problems in the summer (hello Evan Turner), but Damian Lillard continues to set a high bar, C.J. McCollum continues to impress, and Jusuf Nurkic looks to be in shape and healthy in the preseason. I dare say the Blazers will be shockingly fun this year.

23. The Pack Survives. For the first time in more than a decade, the Timberwolves are going to be straight-up good. Adding Tom Thibodeau to a team led by Karl-Anthony Towns and Andrew Wiggins didn’t do the trick a year ago. Adding Jimmy Butler? That’ll do it. The Wolves’ Thibsian style of play may not be too aesthetically pleasing to the masses, but watching the growth of a future MVP like Towns, a manageable role for Wiggins, and a happy environment for Butler — that should be joyous in its own right. Minnesotans have suffered long enough. Go get ‘em, Wolves.

24 Brotherly Love. Perhaps the most intriguing, endearing, and exciting team to watch early this season will be the Philadelphia 76ers. They have two Rookie of the Year candidates, the two runners-up for Rookie of the Year last year, J.J. Redick, assorted other fun youngsters, and a coach with the most inexplicable accent in the nation. Most of all, they have Joel Hans Embiid, a damn good player molded for internet godliness. He’s funny, he’s brash, he’s completely self-aware. And we just might get more than 1,000 minutes of him on the court this season. It’s Embiid’s time. Treasure every second.

25. Revenge LeBron. Look, Kyrie requested a trade while playing under LeBron’s tutelage. Kyrie’s Cavaliers were winning 30 games a year before LeBron came back. And this is the thanks LeBron gets? Dude’s going to be mad when the Cavaliers line up across from the Celtics on opening night. Mad mad mad mad mad.