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Anyone heard yet about DAC 7? Potential bomb for the EU collecting/flipping community?

  1. gatorcpa ΩF InvestiGator Staff Member Mar 19, 2023

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    From the Form 8824 instructions you linked:
    Trades involving watches and other collectibles are taxable in the US in the same manner as sales. No deferrals allowed.
    gatorcpa
     
  2. iamvr Mar 19, 2023

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    The case in point is what‘s going on in Switzerland right now. The country‘s second largest bank Credit Suisse, founded in 1856, needed an emergency credit line by the Swiss National Bank (i.e. the state) of CHF 50 bn to shore up the liquidity needs as the bank is facing a mini bank run given it’s considered the weekest link afteer the failure of three US banks and a major Saudi investor refused to inject more cash. The SNB and the govt. are said to force the larger rival UBS to swallow CS (which would make a too big too fail problem even bigger by creating a superbank). UBS is said to require a state guarranty of CHF 6 bn to do so.
    So like before the GFC, gains were private, losses are public. CS has been mismanaged for 10 yrs, e.g. name any financial scandal and CS was part of it. The managers got sign-on bonuses, yes that’s right, they got paychecks in the millions before even working for one second. They got bonuses during loss years as well. Now it’s time for taxpayers‘ money to clean up the mess again. And who will fill the fiscal hole???
     
  3. befobe Mar 19, 2023

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    Is DAC7 the reason why international transactions from France outside EU are impossible on chr24 since some months?
     
  4. Pastorbottle Mar 19, 2023

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    It never ceases to amaze me that everyone listens to the advice of bankers and economists, when these are the very arseholes that cause all the financial crisis in the first place!
    If public funds are used to bailout banks, then the pubic needs to have a stake in the ownership of the bank in return and the incompetent management to be held responsible for their poor performance …..no more free money to these dickheads!
     
  5. gatorcpa ΩF InvestiGator Staff Member Mar 19, 2023

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    OK, let’s drift further away from the original subject…
    First, understand that those who had equity in SVB and the other banks involved here were totally wiped out. I think that the US and state governments need to take a hard look at bonus money paid to officers at these banks just prior to this crisis. If laws were broken, then lock them up or claw it back.

    The money used to “bail-out” these banks essentially paid depositors, most of whom were neither involved in the bad decisions made by management nor stockholders. They were simply business customers who deposited receipts, paid expenses and ran their payroll accounts through the banks.

    The current $250K FDIC insurance limitation was set in 2006 and is not indexed to inflation. It was intended to protect individuals and not necessarily businesses. $250K doesn’t begin to approach the amount of a bi-weekly or monthly payroll for a business of any size. Since almost all payrolls are done these days by bank transfers, funds have to be on deposit somewhere.

    If the US Government did not step in as a secondary insurer, it is likely that small to medium sized businesses all across the country were not going to meet their payroll obligations to their employees and would start closing their doors, throwing thousands of innocent people (the vast majority of whom were not SVB customers) out of work.

    This is a situation brought on by a number of factors, most of which were caused by bad management of these banks, but some of which were made worse than necessary by bad decisions of the FED and the US Government as led by both parties.

    The path chosen was likely the least worst alternative. This is a classic example of a chain only being as strong as its weakest link.
    gatorcpa
     
  6. pdxleaf ... Mar 19, 2023

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    Regulation is costly until it isn't.

    Air, water, building, railway, banking etc, etc... Regulations can slow or inhibit positive growth. But how often does the aftermatch of a crisis reveal that regulations were ignored or removed.

    My soapbox rant of the day.

    My watch, my brother's car. At least if we're going off the rails we should have pictures.

    20230311_143127.jpg 20230311_144004.jpg
     
    joeshoup, Archer, DrmexicoII and 3 others like this.