My 30th Birthday, yo!

      I predict that the nation takes option B. What the nation will do is take control of all the big industry like steel, lumber, etc. The nation will also have stopped allowing corporations from other countries from taking or buying land in the U.S, so the U.S can use it themselves. The U.S. is also going to invest heavily into renewable energy, which would lessen our reliance on buying foreign oil. The U.S. will also invest more into environmental friendly products (like light bulbs), so the U.S could save the money they would have originally  used to help clean polluted environments so they can continued to be used for creation of new products. The U.S will also invest heavily in recycling so we don't have to take more from the environment, or buy these products from outside countries. The U.S. will have become better at balancing budget by making sure the government spends less money than it takes in (as realistically as possible).

      The last twelve years have been really hard on the American people. Tax rates have increased dramatically. The average person (middle class) will pay thirty percent of every dollar they make to the government. It becomes very hard to get a credit card or loans. The wealthy citizens (upper class) is paying a minimum of fifty percent of every dollar they make to taxes. It has become hard to survive for the poor, there is a temporary period where jobs are hared to find. Then when the debt has decreased to a manageable level, job numbers increase after about ten years, and the U.S. people can start to live better and survive easier again.

Question: I would like to know more about what would happen to the U.S population if China decided to sell/give out the U.S. dollars/debt they hold. Would this cause a famine or housing loss in the U.S? Would the U.S go to war? How much of the world population die or be effected negatively if the U.S dollar became worthless? I'd also like to know what country would then dominate or be the most important economy in the world and what would they do to the U.S. people (help them or "enslave" them)?

Charles Ponzi Research Paper

Charles Ponzi and His Fraudulent Scheme

The years immediately following World War I were a time of great prosperity for countless individuals in America. The rise of wealth in America caused many people to invest their money in order to obtain a quick fortune. This is significant because it allowed Charles Ponzi to implement an extremely fraudulent scheme that caused the creation of the Security Exchange commission which helps to halt fraudulent investment schemes that occur in the American society. Charles Ponzi was an Italian Immigrant that devised a fraudulent scheme that hoodwinked thousands of investors of millions of dollars in 1919 to 1920, which eventually led the creation of laws to prevent the reoccurrence of similar schemes because these added up to help cause the Great Depression.

In the article by Historic U.S. Events (referred to as HUE from now on)“Charles Ponzi Cheats Thousands in Investment Scheme, 1919-1920” Charles Ponzi was an Italian Immigrant whose origins was that of an affluent family gave him a one way ticket to the United States due to his inability to meet family expectations.  In another article written by DISCovering U.S. History (referred to DUH from now on) “Charles Ponzi Cheats Thousands in Investment Scheme, 1919-1920” Charles Ponzi in 1917 he began to work with his father-in-law as a fruit dealer. In 1919, Ponzi received a business letter holding a international reply coupon that had cost the sender the equivalent of one cent in Spain to send to him. This letter provided Ponzi the idea to take advantage of the exchange rate disparities in the trade of international reply coupons.

In the article by U*X*L Biographies, (referred to as UXB from now on) “Charles Ponzi” Ponzi quit his job to focus solely on exchanging these coupons, which he would buy for one cent in his home country of Italy, and then exchange them for five cents in the U.S for a profit of four cents. In the article by DUH, Ponzi created the Securities Exchange company, a firm which was to perform international reply coupon transactions; consequently, this firm was made to cover the fraudulent scheme Ponzi developed to make quick money off of the investors who were deceived into thinking the coupons would make fast money. This fraud quickly became attractive to investors because it promised high yields of money back to the investors, advertising a 50% return in 45 days. What this deceitful scheme did was to pay early investors with high dividends of money Ponzi had received from later investors or from the investors’ own funds, which encouraged other investors to give Ponzi even more money. Written in the article by UXB, Ponzi collected fifteen million dollars from over forty thousand investors over an eight month period starting from August 1919. 

Many people had also referred to Ponzi as “the greatest Italian of them all” which he modestly denied, which a given reply was “But you discovered money!”; these claims were made because of the great success and popularity he had gained when attracting investors, and returning to them unknowingly their own or other investor money for high dividends. In the DUH article, Ponzi’s success had allowed him to use these proceeds to obtain control of several Boston businesses including banks that had made loans to him. He also had begun to live a lavish lifestyle with a mansion, He had become a hero to the immigrant community and small investors.

In the HUE article, Ponzi’s success eventually attracted the attention of Boston’s legal authorities. In early summer of 1920 Ponzi had successfully passed investigations conducted by the District Attorney’s Office, Postal inspectors, and federal attorneys; as a result, Ponzi utilized their inability to find illegal activity as “official pronouncements to lessen any suspicions that investors might have had”, which resulted in the investors trusting Ponzi with their money.The Publisher of the Boston Post, Richard Grozier doubted Ponzi’s claims, and decided to uncover Ponzi as a fraud. Grozier interviewed Clarence Barron of Barron’s Weekly, in which Barron claimed “it would be impossible for the investing genius [Ponzi] to turn over so much [claimed amount of] money [to the investors].” Ponzi responded with a claim that this scheme was “subterfuge for an even more inventive plan that he had developed and wanted to keep secret from Wall street speculators.” Now, even more investors trusted him with their money. Eventually, the Boston Post received an anonymous tip about Ponzi having been jailed in Canada many years before for a similar fraud to his coupon exchange. A few days later Ponzi was arrested and sentenced to five years in prison by Boston’s federal court, in which he served only forty months. He was then  tried by Massachusetts and sentenced to nine years where he escaped on bail to Florida. He eventually served his sentence back in Massachusetts, and then deported to Italy.

The Ponzi scheme didn’t have instant legal and economic impact on the U.S; however, his scheme did contribute to the stock market crash of 1929, and a close collapse of the banking system. As a result, congress passed the Securities Act of 1933 and the Securities Exchange Act of 1934, which required registration with the new Securities Exchange Commission (SEC) before securities were able to be sold. Many frauds, but most notably Ponzi’s also led to the Investment Company Act of 1940 , which required licensing and put limitations on the activities of individuals partaking in security sales or distribution. It was easier for the SEC to stop fraudulent schemes by citing technical breaches of SEC regulations than by focusing of the actual fraud accusations. Ponzi scheme imitators still surface because people make investments in the hopes of getting rich quick. Also, the ability for Ponzi like schemes still arise is because of the SEC’s weakness in focusing on fraud with large amounts of money with few investors, while a large number of individuals investing little amounts of money isn’t as much of a focus. The significance of the Ponzi scheme illustrates that many people can be deceived into investing their money poorly, which can lead to harmful effects on the economy later down the road (which could range from a great depression to even no harmful effects).

Works Cited

"Charles Ponzi." U*X*L Biographies. Detroit: U*X*L, 2003. Gale Student Resources In Context. Web. 28 Nov. 2012.

"Charles Ponzi Cheats Thousands In Investment Scheme, 1919-1920." DISCovering U.S. History. Detroit: Gale, 1997. Gale Student Resources In Context. Web. 28 Nov. 2012.

"Charles Ponzi Cheats Thousands in Investment Scheme, 1919-1920." Historic U.S. Events. Detroit: Gale, 2012. Gale Student Resources In Context. Web. 28 Nov. 2012.

Fiscal Cliff

     The Fiscal Cliff is thought of as the 500 billion of tax increases and spending cuts that will influence the nation's people and take affect after January 1 (called fiscal year of 2013, etc. ). Ben Bernanke made this term to warn the nation of the dangerous and unavoidable drop off in the direction of the nation's tax increases and cuts. For instance, the Bush Tax cuts of 2001 and 2003 were extended to 2012 (they were originally going to expire in 2010), lowered the taxes on the wealthy to 35%. Obama kept this tax rate here even though he desired to raise it to 39% because the economy was still in a weakened state in 2010. If he had raised the taxes, the government could have brought in one trillion dollars in taxes that would have helped lower the country's deficit.
     The Alternate minimum tax (AMT.) is apart of the nation's fiscal cliff because this is a tax people pay on top of their regular income tax. This tax is designed to prevent people with a very high income from utilizing special tax benefits to pay no to small amounts of money in taxes. But, now this tax reaches people who don't have a high income or don't claim many special tax benefits, which causes many individuals to pay more taxes unduly. Also, this tax is theoretically supposed to determine the amount of money a person would pay a specific income. This is part of fiscal cliff because it's a type of tax that influences the amount of taxes the people pay, but also shows that this tax is hard to come to an agreement on who gets taxed, anyone can be taxed.
      The Sequester is also another example of the spending and tax cuts that is the Fiscal Cliff. The sequester is a package of automatic spending cuts that makes up the Budget Control Act (BCA) that was passed in August 2011. This is projected to cut 1.2 trillion of spending split evenly on defence and discretionary domestic spending (exempting war spending, and spending on social security and Medicaid) over the years of 2013 to 2021. This can cause problems because it may lead to major job loss to companies subsidized by the government, but also the aid given to the people like social programs. This is supposed to help keep the economy from obtaining a too high debt by cutting its spending.