Issue 9 2011: September
STOCK MARKET PERFORMANCE
Year-to Date through September 22, 2011
Dow Jones Industrial Average -5.50%
S&P 500 -8.87%
Nasdaq -7.43%
Russell 2000 -17.17%
GENERAL ELECTRIC AND TAXES
How does General Electric get away with paying little to no federal taxes? By employing a tax department of some 975 lawyers and accountants, often called "the world's best tax law firm." Headed by John Samuels, a bow-tie wearing former Treasury Department official, the tax department has more than tripled in size over the past two decades, all in the interest of reducing the company's tax bill. The department is widely admired for its artful accounting, crafted by the dozens of former IRS officials and former employees of congressional tax-writing committees that GE has hired. The company's defenders say it doesn't evade taxes: it simply finds legal tax breaks. Any complaints, they say, should be directed at the U.S. code, not the company. What's more, the company says, its tiny tax bill was a result of writing off $32 billion in losses incurred by its financial services division during the Wall Street meltdown. But GE also files tax returns in 250 global jurisdictions, many of them low-tax countries where profits are parked to avoid the U.S. taxman. ..... The Week
HOW MUCH TAX DO CORPORATIONS PAY?
In theory, their top rate is 35 percent - one of the highest in the world. In reality, most U.S. companies pay far less by exploiting tax breaks and loopholes. Of the 500 major companies in the S&P 500 stock index, 115 paid a tax rate of less than 20 percent over the past five years. Nearly 40 percent paid less than 10 percent. Boeing, for example, paid 4.5 percent in taxes on its profits over the past five years, Southwest Airlines paid 6.3 percent, and Yahoo paid 7 percent, according to research firm Capital IQ. General Electric, one of America's largest corporations, as mentioned above, reportedly will pay little or no federal tax on its $14.2 billion in global profits for 2010. ..... The Week
BANKS HAVE MONEY
U.S. banks had a record $981 billion in cash reserves at the end of July, according to the Federal Reserve. That is more than three times the cash banks had in July 2008. Fears about U.S. financial stability and the European debt crisis have led to a surge in deposits. ..... Bloomberg.com
MILLIONAIRES AND THE FINANCIAL CRISIS
The financial crisis reduced the roster of American millionaires by nearly 40 percent according to the IRS. In 2007, 390,000 people filed taxes reporting incomes of $1 million or more. In 2009, just 237,000 did. The number of filers with incomes of $10 million or more dropped by 55 percent. ..... The Wall Street Journal
SHOPPING MALLS
One in every eleven store sites at traditional American malls is empty, the highest vacancy rate in a decade. Outlet malls, which are cheaper to operate and offer lower prices for shoppers, are thriving. ..... Time.com
ONLY IN AMERICA
A 290 pound New York City man is suing White Castle because he can't fit into the burger chain's seats. Martin Kessman, 64, said restaurant staff assured him two years ago that the "booths were going to be enlarged and made more comfortable for people with a little more weight," but never followed through with that promise. "I just want to sit down like a normal person" said Kessman. ..... The Week
THE SUPER DOCTOR
Roger Allsopp, a retired surgeon, became the oldest person ever to swim across the English Channel. The 70-year-old grandfather left from Dover, England, and arrived in northern France almost 18 hours later, covering a distance of 21 nautical miles. "The fact that a man of my "grand" age can achieve such a physical and mental challenge proves that you can live younger if you keep active in mind and body," said Allsopp, who lives on the Channel Island of Guernsey. His feat helped raise $1.2 million for cancer research at the University of Southampton. ..... The Week
WORKING FOR THE GOVERNMENT
Seven of the world's 10 biggest employers are run by governments. The U.S. Defense Department leads the pack, with 3.2 million employees, followed by the Chinese Army, with 2.3 million. Also in the top 10: China National Petroleum Corp. and Britain's National Health Service. ..... The Economist
COUNTERTERRORISM
The CIA's Counterterrorism Center which had 300 employees on the day of the Sept. 11 attacks, now has more than 2,000 people on staff - more than al Qaida's core membership around the world. ..... The Washington Post
AMERICANS REMAIN TORN ABOUT THE WAR ON TERRORISM
64% of Americans say it is sometimes necessary to sacrifice some rights and freedoms to fight terrorism, and 52% say the government's highest priority should be protecting rights and freedoms, even if it makes it harder to ward off terrorist attacks. 44% say they're embarrased about how the war on terrorism has affected the country's image abroad. ..... Associated Press/NORC Center For Public Affairs Research
MILT'S MORSEL OF THE MONTH
"There is no labor a person does that is undignified, if they do it right." ..... Bill Cosby, quoted in the Montreal Gazette
JIM'S STETHASCOOP
"Charm is the ability to make someone else think that both of you are pretty wonderful." ..... Novelist Kathleen Winsor, quoted in Real Simple
