Sludgeyy

joined 2 years ago
[–] Sludgeyy@lemmy.world 2 points 6 hours ago (1 children)

I'm not arguing if the system is good or bad. I think there should be a good retirement system in place.

Average person makes 65k in America

SS is 12.4% usually split between employee and employer.

That's 8k a year.

Average SS monthly payment is ~2k

18 to 62 is 44 years of payment.

65k × 12.4% = ~8k per year payment

44 × 8 = ~350k

62 to 78 is 16 years. 2k × 12 = 24k per year

16 × 24k = ~384k

So looking right now if I made average pay, paid SS when I was 18, worked until 62, collected SS at 62, died at 78. I would be looking at a 10% return on my investment

Even more if I live past 78

If I came to you said said. "Would you invest for the next 44 years and I'll give you your money back after and 10% more over 16 years, but I'm going to have to have new people entering my "scheme" to pay you..."

That would be a ponzi scheme.

If the government simply kept the money paid and then paid it back with interest earned loaning it out until time to pay. SS wouldn't be in a crisis.

[–] Sludgeyy@lemmy.world 0 points 7 hours ago (3 children)

A Ponzi scheme is a fraudulent investment that pays existing investors with money from new investors. The scheme operators don't actually invest the money, and the scheme collapses when it can't attract new investors.

If the United States didn't have younger people to pay into the system, new investors, the "ponzi scheme" collapses.

The US government, the scheme operator, doesn't invest the money it receives. Instead, it hands it to previous investors

Now I'm not against a national insurance or something. But we know even with new investors the SS fund is going to run out.

If the government saved the money it was paid and treated it like a real savings account or treated it like insurance.

But the way it is now, it can't run forever. Just like a ponzi scheme

[–] Sludgeyy@lemmy.world 2 points 5 days ago

Starting Price / (1-Tariff %) = Final Price Needed to Break Even

$5 / (1-.25) =

5/.75 = $6.67

If an item was $5 and there was a 30% tariff

5 / (1-.30) = $7.14

If there was a 30% tariff and the syrup company wanted to keep same profit they would have to sell each bottle for $7.14.

$7.14 × .30 = $2.14

$7.14 - $2.14 = $5

[–] Sludgeyy@lemmy.world 2 points 5 days ago (2 children)

No, because (1 + tariff) isn't enough to keep up with the tariff because as the price goes up, the tariff also goes up.

Like in the example going from $5 to $6.25 (5 × (1+.25)). Would result in 31 cents less per bottle.

It needs to be ~33% more or $6.67 for the syrup company to keep the same profit with a 25% tariff.

Final Price × Tariff % = Tariff Amount

Final Price - Tariff Amount = Cost of Good Sold

Cost of Good Sold - Expenses = Profit

So if you need $2 profit

$2 = (Final Price - (Final Price × Tariff %)) - Expenses

$2 = (X - (X×.25)) - $3

$5 = X - .25X

$5 = .75X

X = $6.67

Formula would be

Profit = (Final Price - (Final Price × Tariff %)) - Expenses

[–] Sludgeyy@lemmy.world 1 points 5 days ago (5 children)

So if a company still wants to make $2 profit per bottle.

Company raises price to $6.25 to try to cover the tariff (25% increase)

The tariff becomes $1.56 ($6.25 × 25%)

Instead of selling for $5 price, they would sell it for $4.69 effectively ($6.25-$1.56)

Instead of making $2 profit, they would make $1.69 profit ($4.69-$3(production cost))

If they still sold the bottle for $5, paid $1.25 tariff

They would make 75 cents of profit ($5-$3(production cost)-$1.25(tariff))

[–] Sludgeyy@lemmy.world 12 points 5 days ago (7 children)

Let's say a bottle of Canadian Maple Syrup is $5 before.

25% Tariff is $1.25

Let's say the company makes $2 on each bottle before tariff. They really need to make $2 per bottle to cover expenses

So if a company still wants to make $2 a bottle still.

If they sell for $6.25 to try to cover the tariff (25% increase)

The tariff becomes $1.56

Instead of making $5, they would make $4.69.

Instead of $2, they would make $1.69

If they sold the bottle for $5, paid $1.25 tariff

They would make 75 cents

The number for $5 is $6.67

If the company sold the syrup bottle for $6.67. Payed $1.67 in tariff (25%). They would make $2.

Now, of course, they want to sell it for $6.67. Will people pay the increased price?

They can't just keep selling them for $5 and make basically a 1/3 of their previous profit.

Prices have to go up. How much is up to the consumer.

If the consumer is willing to buy Official Canadian Maple Syrup 🍁 for $6.67. The consumer is paying the whole $1.67 tariff.

An interesting thing happens when people pay $8. The syrup company makes an extra $1, Government gets $2 tariff. It's a win for everyone, but the consumer that lost $3. (Kind of scary if Trump gets a Maple Syrup company in Canada, goes around, ignores, or pays himself the tariff and sells a bottle for $5. Both are true Canadian Maple Syrup, it just has his name on it. Are you going to buy the $5 or the $8? Even if you buy the $8, he gets $2)

The consumer can't win. Free economy is better.

~33% increase covers a 25% tariff

If the price settles at $6.

Company pays 50 cents

Consumer pays $1

Trump gets $1.50

Who even is in charge of the "tariff funds"?

Like people are happy with having to pay $1 to get the company to pay 50 cents? Like that's a win?

Sad reality is Americans should not buy anything with a tariff. Paying a premium to help support Canada seems like a good thing but if everyone does it and everyone pays 33% more. The tariff funds makes out like a bandit all thanks to the consumers.

TL;DR: Company facing a 25% tariff will look to raise prices 33%. If they can they are fine or better. Consumers lose. I really like Vermont Maple Syrup