For those of you wondering "Why?" price increases....

[HongNinja]

Originally Posted by Stonedcl

Not true.. Our economy (us) was doing really well during the Clinton era and carried over to the beginning of the bush era (be4 he made a mess of it) and if you look rolex did not have one price increase from 1996-2004. And then since 2004 they had a price increase almost every year.. From 1990 - 2003 rolex had 2 price increases and from 2003-2010 the had 7!!

EXACTLY!! Don't know how people could argue against these facts!!

[Timber Loftis]

Originally Posted by CoopJr

Facts? YYou mean like a certain politician and senile billionaire thinking we're too stupid to know the dif between capital gains tax and income tax?

We can get into this if you like. This is a side discussion on loopholes. It's hard to argue that Wall Street executive getting to treat bonuses like capital gains makes any logical sense -- as it is clearly money paid to them for the fruits of their labor, i.e. income. In some sense it's analogous to the type of work I do for my legal clients -- I tell them what to do to basically best hedge their bets and win a case or deal with a government regulator or what have you. All my bonuses were always treated as raw income.

Moreover, it flies in the face of why the whole separate capital gains rate was invented to begin with -- to reward people for investing in businesses and keeping their money in while those businesses continued to grow. And if you think my portrayal of tax rates being created to control social behavior is offensive -- don't blame me, blame the tax code. Every bit of it, from the number of dependents you can claim at what amounts to what O/N business expenses are deductible vs. subject to amortizing or accelerated amortizing depreciation -- it's all about social manipulation and has been for 70ish years. We can talk alternative structures if you like -- I prefer Use, Waste, or Flat based taxes over income personally -- but I'm just talking about the system as it currently exists.

Here's a real chart from the IRS. Pay close attention to the part that says the bottom 50% pay 2.7%.

And... The bottom 50% owned (in 2007, less now) only about 2.5% of the wealth. From Business Insider a few years back:

So, I don't see the disconnect here in them paying taxes almost exactly relative to what they own.

Side note: Strong connection here between an economics discussion vs. a politics one -- and perhaps we have all been politicked into conflating the two. I am not trying to be political, I'm just trying to provide accurate facts when I see what seem to be inaccuracies.

Originally Posted by Stonedcl

Not true.. Our economy (us) was doing really well during the Clinton era and carried over to the beginning of the bush era (be4 he made a mess of it) and if you look rolex did not have one price increase from 1996-2004. And then since 2004 they had a price increase almost every year.. From 1990 - 2003 rolex had 2 price increases and from 2003-2010 the had 7!!

Back to the price increases during the recession from 2000 onwards. It's not rocket surgery. This decade while bad economically overall, has continued to be a boom industry for the wealthy. This includes all their playthings and explains why luxury watch prices have kept on trending upward. From Wall Street execs to captains of industry on down the list -- the rich on average have continued to make more every year over the past decade. It's been a boom time for the wealthy, the numbers don't lie. As I've said, I'm not freaking out over the Rolex price hikes -- it makes total economic sense for them to do it in this environment. I haven't seen a comprehensive study, but I'd be willing to lay 10:1 odds that across the luxury brands for all luxury products prices have continued to track northward since Y2K.

[Check]

Originally Posted by Timber Loftis

Considering the number of uninsured has gone steadily up while the relative minimum wage has gone steadily down, this sentiment, though common, is uninformed at best.



Facts are stubborn things. - John Adams

As for the definition of "poor," the poverty level for 2011 is $22,350 (total yearly income) for a family of four. How much blood do you expect to extract from such a stone?

The sales figures for luxury watches is a fairly good proxy for real wealth and disposable income.

I don't know wear you live, but I disagree with your glib over generalized statements that the poor get cable, eat steaks and generally live it up on the rest of us taxpayers. This is a gross mis-characterization. Go to Walmart or the part of your town where there are check cashing stores and you will see the real poor (employed/under-employed and unemployed).

The facts speak for themselves:

Unemployment is high,
Over 40M uninsured
Soup kitchens on the rise
Fewer well-paying jobs for the professions due to off-shoring
Evictions/bankruptcies, etc.

[Timber Loftis]

Originally Posted by Check

I don't know wear you live, but I disagree with your glib over generalized statements that the poor get cable, eat steaks and generally live it up on the rest of us taxpayers. This is a gross mis-characterization.

I hope with this, and the remainder, of your post you weren't actually referring to my comments. I'm not glib about those things, and I'd never say them. The graphs I posted were intended to show how the tax rates have varied over time, most notably I posted it to show how the wealthy have enjoyed an obvious hiatus from their traditional rates over the last couple of decades.

Originally Posted by Check

The sales figures for luxury watches is a fairly good proxy for real wealth and disposable income.

This I would agree with, so long as we add the caveat "for luxury product purchasers."

[m_allie]

wOW WHAT BUBBLE

[Check]

Originally Posted by Timber Loftis

We can get into this if you like. This is a side discussion on loopholes. It's hard to argue that Wall Street executive getting to treat bonuses like capital gains makes any logical sense -- as it is clearly money paid to them for the fruits of their labor, i.e. income. In some sense it's analogous to the type of work I do for my legal clients -- I tell them what to do to basically best hedge their bets and win a case or deal with a government regulator or what have you. All my bonuses were always treated as raw income.

Moreover, it flies in the face of why the whole separate capital gains rate was invented to begin with -- to reward people for investing in businesses and keeping their money in while those businesses continued to grow. And if you think my portrayal of tax rates being created to control social behavior is offensive -- don't blame me, blame the tax code. Every bit of it, from the number of dependents you can claim at what amounts to what O/N business expenses are deductible vs. subject to amortizing or accelerated amortizing depreciation -- it's all about social manipulation and has been for 70ish years. We can talk alternative structures if you like -- I prefer Use, Waste, or Flat based taxes over income personally -- but I'm just talking about the system as it currently exists.

And... The bottom 50% owned (in 2007, less now) only about 2.5% of the wealth. From Business Insider a few years back:

So, I don't see the disconnect here in them paying taxes almost exactly relative to what they own.

Side note: Strong connection here between an economics discussion vs. a politics one -- and perhaps we have all been politicked into conflating the two. I am not trying to be political, I'm just trying to provide accurate facts when I see what seem to be inaccuracies.




Back to the price increases during the recession from 2000 onwards. It's not rocket surgery. This decade while bad economically overall, has continued to be a boom industry for the wealthy. This includes all their playthings and explains why luxury watch prices have kept on trending upward. From Wall Street execs to captains of industry on down the list -- the rich on average have continued to make more every year over the past decade. It's been a boom time for the wealthy, the numbers don't lie. As I've said, I'm not freaking out over the Rolex price hikes -- it makes total economic sense for them to do it in this environment. I haven't seen a comprehensive study, but I'd be willing to lay 10:1 odds that across the luxury brands for all luxury products prices have continued to track northward since Y2K.

Oh come on! Really! We both know that numbers and statistics can be manipulated every which way. The numbers and percentages that you used in your little graph is predeductions and therefore inaccurate.

On paper US corporations are subject to some of the highest tax rates in the world, but in reality (read after all of the deductions and loopholes) their EFFECTIVE tax rate is very low and in some instances practically zero.

Believe what you want, but don't pull a graph on me then attribute it to the IRS without meaningful reference material because I'm not buying it.

[Check]

Originally Posted by Timber Loftis

I hope with this, and the remainder, of your post you weren't actually referring to my comments. I'm not glib about those things, and I'd never say them. The graphs I posted were intended to show how the tax rates have varied over time, most notably I posted it to show how the wealthy have enjoyed an obvious hiatus from their traditional rates over the last couple of decades.

This I would agree with, so long as we add the caveat "for luxury product purchasers."

[Timber Loftis]

Hey, Check, after you have re-read some of what I posted and maybe delved into what I had to say, you might want to use the "edit" function on some of your prior couple of posts.

You did mention "effective tax rates" and that is interesting:

Back in 1961, Don Draper and his partners at Sterling Cooper paid somewhere between 27 and 43 percent of their income in federal income taxes. Their counterparts today pay somewhere between 20 and 24 percent.

The "over $1M" category in 2011 dollars is the most interesting to me. In the 1950's we had a top marginal tax rate of over 90% and that carried over into a top marginal tax rate of over 70% in the 1960's. This marginal percentage applied to what would basically be, in today's dollars, the money earned over $1M/yr.

[HongNinja]

Wow. I feel like I'm in college again going over economics and such. My head hurts. Haha

[Check]

Originally Posted by Turk

What is the definition of "poorer" anyways? In the US, 50 years ago, somebody that was poor ate oatmeal everyday for breakfast, bread and cheese for lunch and peanut butter and jelly for dinner. Today, the poor get cable, free rent, free food (steaks), free healthcare. Nowadays, the rich pay more taxes and the poor bitch about not getting enough.

Timberloftis, my disagreement was not directed at you but at this type of post that trivializes the uninsured and the poor in this country.

Turk should walk a mile in the "poorer man's" shoes to see how much cable, free/discounted rent, free food (steaks) etc. the poor actually get. This post is offensive to anyone struggling to make ends meet and runs in the face of static housing, unemployment benefits, etc. that the poor receive in the US. The benefits that Turk quoted have not received proportionate COLA for decades and in fact have been cut.

I feel fortunate that I can afford a Rolex, but let's not insult others that are struggling to make ends meet.

[George Ab]

Thanks Brandon for bringing this to our attention excellent post.

Now that the thread has been hijacked into a political discussion vice watches..... I'm out of here.

[HongNinja]

Originally Posted by George Ab

Thanks Brandon for bringing this to our attention excellent post.

Now that the thread has been hijacked into a political discussion vice watches..... I'm out of here.

Thanks for the shout-out good sir!

Don't know how this evolved into politics, BUT it did.

Bottom lone, politics aside, THIS IS "WHY" the hikes are happening. Simple economics and supply/demand.

[BarkMaster]

Among other things, part of it is increased demand from a growing global middle class.

[Time2time]

Originally Posted by Linzjnr

It's hard to believe isn't it, on one hand you put on the news or read a newspaper and it's all financial doom and gloom and on the other people are spending up big on luxury watches. I guess that for everyone that loses money on a down turn someone else makes it.

Spot on! Where there's a loser there is a winner on the other side.
Still, a little surprising though as high end watches are a luxury item and the world is in a financial predicament.

Saying that, China's meteoric rise is not surprising at all. Predicted to be the world's largest economy by 2020 I beleive.

[buke45]

Ouch!!

[DJF881]

The reason luxury goods have seen a huge rebound, in terms of year-over-year percentage increases is because they had such a huge drop-off. Increasing 20% is a lot less impressive when it follows a drop of 40%.

Volume is still below 2008 levels, even with growth in South America and China picking up some of the slack for North America and Europe.

[Pulpdiction]

I haven't ready the whole thread so apologies if anyone has stated this, but you are measuring an increase in value of sales in Swiss francs and seemingly suggesting that this equates to an increase in demand. I don't think this is correct. Clearly where there is a double digit increase in % terms there is an increase in demand, but I would suggest in all other instances, UK, Spain, Italy, Thailand, etc, there is likely to have been an price increase, or two between 2011 and 2010, so I would suggest that anything less than a 10% increase would suggest either a neutral demand or a decrease in the period measured, it depends on the price increase applied in that market. However the only realy way to measure demand is in unit terms.

[ingoodtime]

As the rest of the worlds economy shrinks more and more, it affects consumer spending. That will affect manufacturing nations in a big way. As we buy less, they need to raise their prices to make the same profit which adds to hyper inflation for the struggling economies. Rolexes heyday will shrink too. Every bubble must burst sooner or later.

[HongNinja]

Maybe I should just wait for the "Bubble" to burst then....

Maybe then I could get all the pieces I want at a GOOD price, and avoid my wife shanking me while I sleep.

[paddy_crow]

6.CONTROVERSIAL TOPICS OR POSTS such as those relating to politics, race, culture, religion, sexual orientation or discrimination, violence (toward persons or animals) will be subject to the final and absolute discretion of the Moderators to be immediately locked and/or removed without notice to any member. No gun, knife, weapon threads or pictures of such since we are a worldwide forum and many members are not comfortable with this type of material. Infraction points and a possible lifelong ban will inevitably accompany such posts or threads.

[HongNinja]

Originally Posted by paddy_crow

6.CONTROVERSIAL TOPICS OR POSTS such as those relating to politics, race, culture, religion, sexual orientation or discrimination, violence (toward persons or animals) will be subject to the final and absolute discretion of the Moderators to be immediately locked and/or removed without notice to any member. No gun, knife, weapon threads or pictures of such since we are a worldwide forum and many members are not comfortable with this type of material. Infraction points and a possible lifelong ban will inevitably accompany such posts or threads.

Ummmm. Good thing you're not a moderator then... Further more, things have been redirected back to the original post, so why the BOLD copy and paste of the rules? Seems counter productive...

[z32turbo]

Interesting chart.

[paddy_crow]

Originally Posted by HongNinja

Ummmm. Good thing you're not a moderator then... Further more, things have been redirected back to the original post, so why the BOLD copy and paste of the rules? Seems counter productive...

Counter productive? That's pretty funny.