How can businesses spend like crazy [referring to the passage of proper stimulus] when CEO's are still having major headaches dealing with massive overcapacity they have borrowed to invest in during the past ten boom years, when companies are announcing plans to shut down factories and plants, laying off workers quarter after quarter and writing off billions of bad investments? (October 6, 2001)
The key is the right kind of stimulus. If you get an investment tax credit for buying a comptuer system, phone system, new manufacturing equipment, that means on your bottom line taxes you subtract the amount you spent (limited by the size of the credit given) from your final tax bill. Figure your taxes and then subtract the credit from the bottom line. That is very, very powerful. If you invest in your business, you directly reduce your taxes dollar for dollar for the investment you make. In that sense, you cannot afford NOT to buy the systems. Instead of sending off that money as a tax, you spend it, get the latest and greatest equipment, and lower your tax bill by the same amount. It is a surefire way to unleash buying in areas where there is slack demand and inventory.
|Previous Page||Next Page|