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John Galt[_2_]
March 12th 09, 01:34 PM
Anybody have insight into any of the following thoughts?

A victim was on CNBC the other night talking about how the goverment
should compensate the victims over and above the $500K SIPC limit. My
initial thought was "why should **I** pay?", but then thought through
the issue.

From a macro standpoint, there were technically no gains, ever. If you
assume the investors were high tax bracket individuals, they would have
paid some amount of taxes on these gains over time. If cap gains, they
paid on average someplace in the neighborhood of 20-22% on them over
time; if dividends, probably about the same, if regular income,
someplace between 35 and 40%. None of the gains were real, so none of
the taxes charged on them were real.

The government would probably argue (successfully) that anyone who
realized their gains received value from that realization, and thus
taxes on that money were rightfully collected. But, what about the case
of individuals who did not sell shares, but reinvested their dividends?
A person who invested $1,000,000 in 1990 and never took gains probably
paid taxes on their reinvested dividends of around 2.5 million by the
end of 2007.

Assuming their documentation is in order and can prove it, should the
government cut them a check? After all, they never received any monetary
benefit, and the gains weren't real.

????

JG

Awaken21
March 12th 09, 02:13 PM
On Mar 12, 9:34*am, John Galt > wrote:
> Anybody have insight into any of the following thoughts?
>
> A victim was on CNBC the other night talking about how the goverment
> should compensate the victims over and above the $500K SIPC limit. My
> initial thought was "why should **I** pay?", but then thought through
> the *issue.
>
> *From a macro standpoint, there were technically no gains, ever. If you
> assume the investors were high tax bracket individuals, they would have
> paid some amount of taxes on these gains over time. If cap gains, they
> paid on average someplace in the neighborhood of 20-22% on them over
> time; if dividends, probably about the same, if regular income,
> someplace between 35 and 40%. None of the gains were real, so none of
> the taxes charged on them were real.
>
> The government would probably argue (successfully) that anyone who
> realized their gains received value from that realization, and thus
> taxes on that money were rightfully collected. But, what about the case
> of individuals who did not sell shares, but reinvested their dividends?
> A person who invested $1,000,000 in 1990 and never took gains probably
> paid taxes on their reinvested dividends of around 2.5 million by the
> end of 2007.
>
> Assuming their documentation is in order and can prove it, should the
> government cut them a check? After all, they never received any monetary
> benefit, and the gains weren't real.
>
> ????
>
> JG

In some cases we're going pay anyway. I know one of his victims
personally. She had a few million that she was using to live out her
retirement in relative comfort and maybe leave a little to her kids.
That money was invested with Madoff because that's where her father
and husband had left the money when they died, and she felt, rightly,
she didn't know enough about investing to start toying around with
their decisions on where to invest.

At this point her kids are going to be helping her. So are you and I
because she's completely ruined and will be leaning heavily on gov't
supports where available.

Dr Tormento
March 12th 09, 08:33 PM
John Galt > wrote in news:[email protected]
03.dc1.easynews.com:

> Anybody have insight into any of the following thoughts?
>
> A victim was on CNBC the other night talking about how the goverment
> should compensate the victims over and above the $500K SIPC limit. My
> initial thought was "why should **I** pay?", but then thought through
> the issue.
>
> From a macro standpoint, there were technically no gains, ever. If you
> assume the investors were high tax bracket individuals, they would have
> paid some amount of taxes on these gains over time. If cap gains, they
> paid on average someplace in the neighborhood of 20-22% on them over
> time; if dividends, probably about the same, if regular income,
> someplace between 35 and 40%. None of the gains were real, so none of
> the taxes charged on them were real.
>
> The government would probably argue (successfully) that anyone who
> realized their gains received value from that realization, and thus
> taxes on that money were rightfully collected. But, what about the case
> of individuals who did not sell shares, but reinvested their dividends?
> A person who invested $1,000,000 in 1990 and never took gains probably
> paid taxes on their reinvested dividends of around 2.5 million by the
> end of 2007.
>
> Assuming their documentation is in order and can prove it, should the
> government cut them a check? After all, they never received any monetary
> benefit, and the gains weren't real.
>
> ????
>
> JG
>

I believe theft is deductible. That effectively recovers the taxes.

March 12th 09, 10:29 PM
we learned in grade school;" don't put all your eggs in one basket" so i
say ;" **** em"....as they were geting their huge "paper" returns, they
were mocking guys like me for investing the "right ,safe
slow,way"...now they have nothing and i am rollin in dough...like i
said;" **** em"..


"THE BLACK HAND" is the name of the international
terrorist group that is causing all the problems.