Friday, February 1, 2013

IRS: Cheapest Obamacare Plan Will Be $20,000 Per Family

IRS: Cheapest Obamacare Plan Will Be $20,000 Per FamilyBarack Obama, Kathleen Sebelius, Nancy Pelosi

President Barack Obama hugs HHS Secretary Kathleen Sebelius and then-House Speaker Nancy Pelosi after signing the Obamacare law on March 23, 2010. (White House photo/Pete Souza)
( – In a final regulation issued Wednesday, the Internal Revenue Service (IRS) assumed that under Obamacare the cheapest health insurance plan available in 2016 for a family will cost $20,000 for the year.
Under Obamacare, Americans will be required to buy health insurance or pay a penalty to the IRS.
The IRS's assumption that the cheapest plan for family will cost $20,000 per year is found in examples the IRS gives to help people understand how to calculate the penalty they will need to pay the government if they do not buy a mandated health plan.
The examples point to families of four and families of five, both of which the IRS expects in its assumptions to pay a minimum of $20,000 per year for a bronze plan.
“The annual national average bronze plan premium for a family of 5 (2 adults, 3 children) is $20,000,” the regulation says.
Bronze will be the lowest tier health-insurance plan available under Obamacare--after Silver, Gold, and Platinum. Under the law, the penalty for not buying health insurance is supposed to be capped at either the annual average Bronze premium, 2.5 percent of taxable income, or $2,085.00 per family in 2016.
In the new final rules published Wednesday, IRS set in law the rules for implementing the penalty Americans must pay if they fail to obey Obamacare's mandate to buy insurance.
To help illustrate these rules, the IRS presented examples of different situations families might find themselves in.
In the examples, the IRS assumes that families of five who are uninsured would need to pay an average of $20,000 per year to purchase a Bronze plan in 2016.
Using the conditions laid out in the regulations, the IRS calculates that a family earning $120,000 per year that did not buy insurance would need to pay a "penalty" (a word the IRS still uses despite the Supreme Court ruling that it is in fact a "tax") of $2,400 in 2016.
For those wondering how clear the IRS's clarifications of this new "penalty" rule are, here is one of the actual examples the IRS gives:

Meltdown (playlist)

Is Germany preparing for future capital controls?

The best indicator of a chess player's form is his ability to sense the climax of the game.
–Boris Spassky, World Chess Champion, 1969-1972
You've likely heard that the German central bank announced it will begin withdrawing part of its massive gold holdings from the United States as well as all its holdings from France. By 2020, Bundesbank says it wants half its gold reserves stored in its own vault in Germany.
Why would it want to physically move the metal from New York? It's not as if US vaults are not secure, and since Germany already owns the gold, does it really matter where it sits?
You may recall that Hugo Chávez did the same thing in late 2011, repatriating much of his country's gold reserves from London. However, this isn't a third-world dictatorship; Germany is a major ally of the US. So what's going on?

Pawn to A3

On the surface, it may seem innocuous for Germany to move some pallets of gold closer to home. Some observers note that since Russia isn't likely to be invading Germany anytime soon – one of the original reasons Germany had for storing its gold outside the country – the move is only natural and no big deal. But Germany's gold stash represents roughly 10% of the world's gold reserves, and the cost of moving it is not trivial, so we see greater import in the move.
The Bundesbank said the purpose of the move was to "build trust and confidence domestically, and the ability to exchange gold for foreign currencies at gold-trading centers abroad within a short space of time." It's just satisfying the worries of the commoners, in the mainstream view, as well as giving themselves the ability to complete transactions faster. As evidence that it's nothing more than this, Bundesbank points out that half of Germany's gold will remain in New York and London (the US portion of reserves will only be reduced from 45% to 37%).
Sounds reasonable. But these economists remind me of the analysts who every year claim the price of gold will fall – they can't see the bigger implications and frequently miss the forest for the trees.


What your friendly government economist doesn't reveal and the mainstream journalist doesn't report (or doesn't understand) is that in the event of a US bankruptcy, euro implosion, or similar financial catastrophe, access to gold would almost certainly be limited. If Germany were to actually need its gold, regardless of the reason, any request for transfer or sale would be… difficult. There would be, at the very least, delays. At worst such requests could be denied, depending on the circumstances at the time. That's not just bad – it defeats the purpose of owning gold.
But this still doesn't capture the greater significance of this action. First, it reinforces the growing recognition that gold is money. Physical bullion isn't just a commodity, a day-trading vehicle, or even an investment. It's a store of value, a physical hedge against monetary dislocations. In the ultimate extreme, it's something you can use to pay for goods or services when all other means fail. It is precisely those who don't recognize this historical fact who stand to lose the most in an adverse monetary event. (Hello, government economist.)
Second, here's the quote that reveals the ultimate, backstop reason for the move: Bundesbank stated it is a "pre-emptive" measure "in case of a currency crisis."
Germany's central bank thinks a currency crisis is really possible. That's a very sobering fact.
We agree, of course: history is very clear on this. No fiat currency has lasted forever. Eventually they all fail. Whether the dollar goes to zero or merely becomes a second-class currency in the global arena, the root cause for failure is universal and inevitable: continual and perpetual dilution of the currency.
Some level of currency crisis is inescapable at this point because absolutely nothing has changed with worldwide debt levels, deficit spending, and currency printing, except that they all continue to increase. While many economists and politicians claim these actions are necessary and are leading us to recovery, it's clear we have yet to experience the fallout from spending more than we have and printing the difference. There will be serious and painful consequences, sooner or later of an inflationary nature, and the average person's standard of living will be greatly reduced.
And now there are rumblings that the Netherlands and Azerbaijan may move their gold back home. If this trend gathers steam, we could easily see a "gold run" in the same manner history has seen bank runs. Add in high inflation or a major currency event and a very ugly vicious cycle could ignite.


If other countries follow Germany's path or the mistrust between central bankers grows, the next logical step would be to clamp down on gold exports. It would be the beginning of the kind of stringent capital controls Doug Casey and a few others have warned about for years. Think about it: is it really so far-fetched to think politicians wouldn't somehow restrict the movement of gold if their currencies and/or economies were failing?
Remember, India keeps tinkering with ideas like this already.
What this means for you and me is that moving gold outside your country – especially if you're a US citizen – could be banned. Fuel would be added to the fire by blaming gold for the dollar's ongoing weakness. Don't think you need to store gold outside your country? The metal you attempt to buy, sell, or trade within your borders could be severely regulated, taxed, tracked, or even frozen in such a crisis environment. You'd have easier access to foreign-held bullion, depending on the country and the specific events.
None of this would take place in a vacuum. Transferring dollars internationally would certainly be tightly restricted as well. Moving almost any asset across borders could be declared illegal. Even your movement outside your country could come under increased scrutiny and restriction.
The hint that all this is about to take place would be when politicians publicly declare they would do no such a thing. You could quite literally have 24 hours to make a move. If your resources were not already in place, even the most nimble of us would have a very hard time making arrangements.
Once the door is closed, attempting to move restricted assets across international borders would come with serious penalties, almost certainly including jail time. In such a tense atmosphere, you could easily be labeled an enemy of the state just for trying to remove yourself from harm's way.
The message is clear: storing some gold outside your country of residence is critical at this point, and the window of time for doing so is getting smaller. Don't just hope for the best; do something about it while you still can. The minor effort made now could pay major dividends in the future. Besides, you won't be any worse off for having some precious metals stored elsewhere.
The best chess players in the world aren't that way because they can see the next move. They're champions because they can see the next 14 moves.
You only have to see the government's next two moves to "win" this game. I suggest learning what countermoves you can take now are, before your government declares checkmate.

The National Debt: A Short History Of Presidential Lies

Presidents love to lie about cutting spending.
New video produced by the non-partisan Bankrupting America on Washington’s history of inaction on cutting spending
Talk Is Cheap, Overspending Is Not
In 1986 our debt was $2.1 trillion and Washington was making promises to rein in our excessive spending.  Twenty-seven years later Washington is still making promises, but the only differences we see are a $16.5 trillion debt and better picture quality on C-SPAN.
If we’ve learned anything since then, it’s that the only thing a talking politician is good for is a distraction.  #TalkIsCheap.
DB here.  Dallas Fed President Richard Fisher calculated that the government's unfunded liability for Social Security and Medicare alone comes to a staggering $99.2 trillion, or $330,000 for every man, woman, and child in the United States.
It's an impossible figure, but still on the low side compared to this estimate of $222 trillion published at Bloomberg.
The national debt has grown by $6 trillion since the Spender-In-Chief took office, and four more $1 trillion deficits are on the way before Obankster leaves Washington in 2016.
Check the debt clock and decide for yourself.  Is there anything, anything at all, that appears 'under control' to you?
Bonus - David Walker with Jon Stewart.

"There is no party of fiscal responsibility in Washington."
"When the statutory budget controls expired in 2002, Washington lost total control.  Unfunded tax cuts, unfunded war costs, expansion of entitlement benefits.  And we are where we are today."

Rick Santelli Slams Ben Bernanke 'Whatever You're Doing, Bloodletting & Leeches, It Isn't Working!'.

Rick Santelli Slams Ben Bernanke 'Whatever You're Doing, Bloodletting & Leeches, It Isn't Working!'.

Chris Whalen & Barry Ritholtz: 'The Derivatives Timebomb'

Great discussion.  Global derivatives are 5 times global GDP.
Found this clip over the weekend.  It's worth the time.
According to the Office of the Comptroller of the Currency’s fourth quarter report for 2011, approximately 95% of the $230 trillion in total U.S. derivative exposure was held by just four financial institutions: JP Morgan Chase, Bank of America, Citibank, and Goldman Sachs.
Dec. 5 (Bloomberg Law) -- The unregulated multi-trillion dollar derivatives market exceeds global GDP and poses a clear danger to the global economy, Chris Whalen, Senior Managing Director at Carrington, and Barry Ritholtz, CEO at Fusion IQ, tell Bloomberg Law's Lee Pacchia. "The fix is very simple," says Ritholtz, "repeal the Commodities Futures Modernization Act and suddenly this becomes like every other financial instrument." Whalen notes that the financial industry is reluctant to change the way derivatives are managed because they generate large returns at a time when banks are less profitable than before. "The super normal returns that they earn from derivatives subsidize the rest of the business," he says. One way or the other, Ritholtz and Whalen believe the financial industry needs to get used to the idea of making less money.

Gold Will Rise Above 000$, Inflation Raises Gold Mine Costs

Gold Will Rise Above 000$, Inflation Raises Gold Mine Costs

Thousands of small firms could win share of £10billion over 'cruel' loan deals from banks

  • Financial Services Authority found banks guilty of 'serious failings'
  • Vast majority of the 'interest rate swap' loans mis-sold to small businesses
  • Reminiscent of Payment Protection Insurance scandal that cost £12billion

  • Tens of thousands of small firms ‘cruelly conned’ by banks into taking out rip-off loans could get more than £10billion in compensation, it emerged last night.
    On another day of shame for Britain’s banking giants, the Financial Services Authority found them guilty of ‘serious failings’ over the sale of the complex ‘interest rate swap’ loans.
    Many deals contained an expensive ‘break clause’, which meant they could not escape the loan without paying a fortune to the bank. This could exceed 40 per cent of the value of the original loan.
    Scandal: Britain's biggest banks will have to pay out millions to the victims of mis-sold interest rate swaps
    Scandal: Britain's biggest banks will potentially have to pay out billions to the victims of mis-sold interest rate swaps
    Thousands of the loans were sold by the country’s four biggest banks – Lloyds Banking Group and Royal Bank of Scotland, both rescued by taxpayers, as well as Barclays and HSBC.
    Yesterday Business Secretary Vince Cable said it is yet another ‘example of the little guy paying for the big banks’ wrongdoing.’

    Greg Clark, Financial Secretary to the Treasury, said the victims had been ‘cruelly conned by the very people they trusted’, with many sold loans by banks where they had held accounts for more than 40 years.
    It is the latest in a long list of banking scandals, the most notorious of which has been the £12billion mis-selling of payment protection insurance.


    Alan Henderson has run his firm in Putney, south-west London, for 40 years.
    But it has been pushed close to the brink of collapse by a £1.75million loan which Mr Henderson, 73, feels he was ‘hoodwinked’ into taking out.
    The company has two businesses – Henderson Signs and Henderson Builders. Mr Henderson’s wife Margaret, 73, does the accounts, their daughter, Jane, 47, is the secretary and their son Mark, 50, runs the building business.
    Mr Henderson took out the loan with RBS in February 2008, and his first quarterly payment for around £22,000 was as expected.
    Within months, the loan repayments had risen to £34,000. The loan repayment had dropped to £11,000 but there was an extra payment of £23,000 for the ‘swap’.
    Furthermore, Mr Henderson would have to pay a ‘break cost’ of around £400,000 to get out of the loan. Mr Henderson said: ‘I do feel they hoodwinked me.’ 
    They were told they had to continue paying the cost of the ‘swap’ for a further five years, even after the five-year loan ends because they had repaid it.
    Fortunately, RBS has recently suspended the payments following the investigation by the FSA.

    Criticism: The FSA claims that 90 per cent of the swaps were wrongly marketed to their buyers
    Criticism: The FSA claims that 90 per cent of the swaps were wrongly marketed to their buyers


    Ever since the advent of the credit crunch and the financial crisis which has been blamed on banks' reckless lending policies, financial institutions have become wrapped up in a mounting succession of scandals.
    May 2011: After a long-running regulatory battle over Payment Protection Insurance, the big banks admitted they had misled their customers into buying unnecessary coverage and agreed to set aside up to £13billion to pay compensation to those affected.
    June 2012: Barclays was fined after its traders were found to have manipulated the Libor benchmark lending rate. The investigation was soon widened to take in a number of other banks.
    August 2012: Standard Chartered was accused of breaking sanctions banning trading with Iran, by hiding $250billion worth of transactions involving the pariah state. The bank was fined $340million by regulators in New York.
    November 2012: It emerged that HSBC had enabled criminals' money laundering by allowing them to set up offshore accounts in Jersey. The bank admitted its controls over laundering were too lax and was hit by another huge fine.
    Yesterday the City regulator slammed the banks for ruthlessly taking advantage of small business owners, who were persuaded to take out loans they did not understand.
    Many of the victims had no idea the terms contained a stealth clause meaning it would cost them a fortune if interest rates started to fall.
    Some of them have gone bust. Others have been forced to make redundancies or ask staff to work for free, while others are having to raid their pension and savings to keep afloat.
    The FSA said it believes at least 40,000 loans were taken out but does not know the exact number of small firms affected. Some may have taken out more than one loan.
    Its initial investigation into 173 of the loans found ‘over 90 per cent did not comply with one or more of our regulatory requirements’.
    The compensation bill will be  huge, with estimates ranging from  £1.5billion to more than £10billion.
    The average compensation payout for PPI from the Financial Ombudsman Service is £2,750 but the scale of the compensation to small business owners will be far higher.
    In total, the four big banks have set aside around £650million to pay compensation, but this is likely to be just the start of the final bill.
    Matthew Fell, a director of the Confederation of British Industry, said: ‘Giving businesses prompt and proper redress will enable banks to then focus on lending to the real economy.’
    Mr Cable added that the immediate priority is ‘to ensure small businesses are not driven out of business by banks pursuing liabilities for swaps that they mis-sold’.
    The FSA said it found examples of the cost of the ‘break clause’ ‘exceeding 40 per cent of the value of the underlying loan’. Last year, when the scandal broke Tory MP Gary Streeter said: ‘I think it will become as big a scandal as PPI.’
    Banks have been ordered to complete their reviews of their cases within six months, although those with large numbers of victims are allowed to take up to 12 months.
    Jeremy Roe, of Bully Banks, described the announcement as ‘a Polo settlement’ because it has a hole in the middle – as it is unclear how much compensation will be paid.


    Paul Adcock's family firm pays up to £7,700 a month on expensive loan repayments to Barclays
    A century ago, Paul Adcock’s great-grandfather set up a shop in the high street of the Norfolk town of Watton.
    Now, thanks to a complex loan deal sold by Barclays, the family business is struggling under a massive debt.
    Speaking when the scandal came to light last June, Mr Adcock said he felt angry at the way the bank, which has been the firm’s ‘trusted adviser’ for 100 years, has treated him.
    In 2006, he took out a loan for around £970,000 to make alterations to his electrical shop, but he was advised to take out a swap to protect himself against interest rate rises.
    Mr Adcock, who has worked at the shop since he was 18, said that he had no idea what he was taking out when an adviser from Barclays Capital came to speak to him.
    When faced with a barrage of questions from the adviser on his ‘predictions on the future movements of interest rates’, Mr Adcock simply said: ‘I am an electrical retailer. I sell televisions and washing machines.’
    The consequences have been devastating. He estimates the swap has cost him around £185,000.
    Each month, he is making payments of around £7,700 to Barclays, but most of the money – around £4,500 – goes on the swap. The exact payments vary each month.
    Mr Adcock, whose brothers, Chris and Mark, also work for the business, says the extra financial burden has crippled his business.
    He has had to make two redundancies from his small team of staff. His wife, Marion, 51, is retraining as a midwife to try to bring in another source of income.
    The shop, Adcocks of Watton, cannot sell a wide range of products because they cannot afford to buy the stock, although his customers have been extremely sympathetic. He said that running a small independent retail store during a double-dip recession is obviously difficult, but Barclays has made the situation far, far worse.
    ‘Having to fight the economic climate was always going to be tough,' he said. ‘But going into the battle with no ammunition [because of the swap payments] is really sickening.’
    A Barclays spokesman said the bank was working with Mr Adcock to minimise the damage to his firm.


    Chairman of the Federal Reserve: Ben Bernanke (Jewish)
    Bernanke is printing funny money like it is going out of style!
    The past THREE chairmen of the Federal Reserve: Alan Greenspan (Jewish) - Paul Volcker (born to Jewish mother (Klippel) /raised Lutheran) - Arthur Burns (Jewish)
    Alan Greenslime (1987-2006) He created the catastrophic housing bubble.
    Paul Volcker (1979-1987) He once said "American must accept a reduction in their living standards."
    Arthur Burns (1970-1978) President Nixon feared him.
    Vice Chairman of the Federal Reserve: Janet Yellen (Jewish). Her predecessor was Donald Kohn (Jewish) 
    Janet Yellen
    Donald Kohn
    Chairman of the Board of New York Branch of the Federal Reserve: (the most powerful of the Fed's branches): Lee Bollinger (Jewish)
    Bollinger is also President of Columbia University and a member of the Board of the Washington Post.

    Secretary of the US Treasury: Jack Lew (Jewish), Deputy Secretary of US Treasury: Neal Wolin (Jewish)
    Jack Lew
    Neal Wolin
    The Chairman of the OMB (Office of Management and Budget) from 2009 - 2010 was Peter Orzag (Jewish). It was Orzag who orchestrated the 10 year budget forecast that made 1.5 Trillion Dollar annual deficits permanent. After setting America's finances on its current, auto-piloted suicide course, Orzag resigned in 2010.
    Peter Orzag. He walked away after setting up Obama's budgetary debt time bomb.
    The Chairman of the SEC (Securities and Exchange Commission): From 2009-2012: Mary Schapiro (Jewish) As of January 2013, the new Chairman is Mary Jo White: (not Jewish, but as a US District Attorney, she whitewashed the crimes of Jewish financial criminal Marc Rich)
    Gentile Mary Jo White / Goy Puppet of Jewish Finance
    Mary Schapiro
    Chairman of the CFTC (Commodity Futures Trading Commission) - Gary Gensler (Jewish) His predecessor was Walter Lukken (Jewish)
    Gary Gensler (He even looks like a vampire!)
    Walter Lukken
    Chairman of the FDIC (Federal Deposit Insurance Corporation): Martin J. Gruenberg (Jewish) Previous Chairman of the FDIC: Sheila Bair (Jewish)
    Sheila Bair
    Martin Gruenberg
    Chairman of NCUA (National Credit Union Administration): Debbie Matz (Jewish)
    Debbie Matz. The Zio-Mafia even has its hands on our Credit Unions!
    Chairman of President Obama's 3 member "Council of Economic Advisors": Alan Krueger (Jewish) The other two members: Katherine Abraham (Jewish) and Carl Shapiro (Jewish)
    Chairman Alan Krueger
    Carl Shapiro
    Katherine Abraham
    The Director of the CBO (Congressional Budget Office) is Douglas Elmandorf (Jewish) *CBO provides (concocts) key economic data for Congress.
    Douglas Elmandorf "Don't worry. According to my math, the budget will balance in about 100 years."
    Commissioner of the IRS (Internal Revenue Service): Doug Shulman (Jewish)
    Gensler runs the dreaded IRS, America's premier extortionist.
    CEO and Chairman of Goldman Sachs (the preferred broker/banker of the Federal Reserve): Lyoyd Blankfein (Jewish)
    Blankfein's Goldman Sachs has been compared to "an octopus with tentacles wrapped around the world."
    The President of CNBC (America's main financial news network) is Mark Hoffman (Jewish)
    Mark Hoffman. Don't expect his CNBC shows to tell you who controls U.S. finances!