After-tax incomes and spending show big gains

[Xipe Totec]

Source: Associated Press

WASHINGTON - The millions of economic stimulus payments gave a massive jolt to household finanances in May, sending after-tax incomes up by the largest amount in 33 years.

The payments helped boost consumer spending by the largest amount in six months.

The Commerce Department reported that disposable incomes, the amount left after paying taxes, surged by 5.7 percent last month. It was the biggest increase since May 1975, reflecting $48.1 billion in rebate payments made last month. The surge in incomes helped boost consumer spending by 0.8 percent, the biggest gain since last November.

Read more: http://news.yahoo.com/s/ap/20080627/ap_on_bi_go_ec_fi/economy_96

---

Oh, and the chocolate rations went up too!

[marmar]

1. "Massive jolt to household finances".....

:rofl: What planet does that AP writer live on?

[hobbit709]

3. Planet Bozone of course.

[hobbit709]

2. And the Easter Bunny is real too.

[Xipe Totec]

20. Magical thinking

the repug answer to all our problems.

If you believe real hard, you can make things happen.

Mmmm, no. I don't think so.

[LibDemAlways]

4. I call bullshit. Whoever wrote that is either delusional

or on the Bush Crime Family payroll.

My so-called "economic stimulus payment," if it ever gets here, will amount to a few paltry dollars.

My brother used his $83 to help pay a car repair bill.

My elderly parents made out the best of all. They got the full $600 which promptly disappeared into a home repair.

"Economic stimulus" my ass.

[hatrack]

5. Wow-wee!!!!

OK, the Census Bureau says that Median Household Income for all Americans, with a few exclusions, was $48,451 in 2006, according to the most recent American Community Survey.

http://www.census.gov/prod/2007pubs/acs-08.pdf - it's on p. 9.

So . . . if we assume a family of four - that is $1,200 for two working parents, plus $300 for each dependent child, we get $1,800 in the form of a tax rebate, or about 3.7% of median income. That's not too wildly off the 5.7% "surge" in incomes reported, considering different family sizes, etc.

Another way of looking at it is that our typical family of four got a little less than two weeks' extra pay in the form of a tax rebate.

And now, it's all gone.

[Lorien]

17. And this atypical family of one

spent her $300 on her electric bill. YEEEAAARRRGH! That should stimulate the economy!

[melm00se]

28. take home pay

Can you figure what the take home pay would be for the median income family and then recalculate?

the reason I ask is that the gross is hardly all usable income. the net, however, is.

[fasttense]

6. And what are they going to do next month?

Just remember folks, we are living on borrowed money. We have got to pay this all back some day......

[pattmarty]

12. Next month? C'mon, ya know "these people" don't give a fuck about next month.

[MilesColtrane]

7. ahem

06. U.S. May real disposable incomes flat excluding rebates
8:32 AM ET, Jun 27, 2008

[Doctor_J]

8. Cool! Better send out a refund every month to keep this rolling!

Nothing like Repukelican accounting. :puke:

[Trillo]

13. I second that! n/t

[pattmarty]

9. Ya know, those "stimulus" checks are taxable.........

[Merlot]

10. So that's why the average check is $600

becasue anything less than $600 isn't taxable income.

Clever aren't they?

[pattmarty]

11. Well, they don't take taxes out. I would think that you would have.....

......to declare it on your 2008 tax return. I am not a lawyer to I don't know this for sure, but I do know if you receive a state refund, it is federally taxable no matter the amount.

[2PeiMom]

14. It's not taxable, according to the IRS site:

http://www.irs.gov/newsroom/article/0,,id=179211,00.html

[CountAllVotes]

15. Welcome to the DU

:hi: and YES you are right!

>>Q. Is my stimulus payment taxable?

A. No. You will not owe tax on your payment when you file your 2008 federal income tax return. But you should keep a copy of the IRS letter you receive later this year listing the amount of your payment.

http://www.irs.gov/newsroom/article/0,,id=182003,00.html

:kick:

[high density]

31. It's written down on the 2008 return as being paid to you

But it is not taxable income. I assume this is to make sure that all eligible people are paid the stimulus. If it turns out you are eligible but were not paid it this year, it will be included in your refund check after filing 2008 taxes.

The stimulus is basically a one time tax cut that would've been realized after filing our 2008 taxes. Instead of waiting for everybody to file those in 2009, Bush spent millions on distributing the money this spring and summer based on the 2007 tax returns people submitted. With the election coming up, the money obviously couldn't wait. :eyes:

[Mrs. Overall]

16. "The SURGE in income..." I thought I read on DU yesterday that the $600 bought gas

for most households.

This article is strange beyond words.

[Pale Blue Dot]

18. Even Wall Street isn't buying this crap anymore.

The Dow's down another 75 pts. as of this moment.

[jayfish]

19. Awesome! Proof That...

trickle-down economics is a load of shite. Dem. office holder please take note.

Jay

[maxsolomon]

21. NPR reported in the same breathless style this a.m.

i'm spending my 600 on 4 trips to a psychiatrist! not that i wasn't going to go anyway...

:crazy:

[skoalyman]

22. here ya go AP.

[kestrel91316]

23. Ok, if Americans are doing SOOOOO well, why is my practice

income down this year to about where it was 17 years ago and then also after the Northridge quake? Just curious.

IMHO somebody is lying. The same way they lie about there being no inflation when nobody has any discretionary income any more because food and gas are bankrupting them.

You can get statistics to say whatever you want. You just have to know how to twist them. And Bushco are experts at manipulation, as we so well know.

[Xipe Totec]

24. It's easier once you have slipped the surly bonds of reality

why find statistics to prove a point, when you can just fabricate them.

[wishlist]

25. My check won't even pay the increase in cost of heating oil to fill my tank

I put off filling my oil tank last year and this year so far since I have a large tank and didn't have to top it off, but I will need to get more sometime in next six months. I got by with less oil by using an efficient electric baseboard heater in the living room last winter, but our power company has requested a 16% rate increase to go in effect before end of the year. Last oil fillup was only $2 a gallon versus $4 to $5 now.

[UpInArms]

26. "which means that it could easily reverse in the coming months"

The US dollar continued to sell-off for the third consecutive trading as the Fed’s disappointment hangs over the market. Personal income and personal spending both increased more than expected thanks to stimulus rebate checks. However apparently the BEA included the tax rebates in the personal income calculation which means that it could easily reverse in the coming months. The PCE inflation numbers confirm the existence of high inflation pressures even though they were slightly weaker than the market expected. In the coming week, the dollar should remain weak. It will be a shortened trading week with US traders off for the Independence Day Holiday, but that does not mean that there will not be volatility. With non-farm payrolls, service and manufacturing sector ISM numbers due for release, expect some decent action in the US dollar. Based upon the recent layoff announcements and cutbacks by companies across the nation in response to higher energy prices, job losses will continue. Not only will non-farm payrolls drop for the sixth month in a row, but we believe that the market’s -55K forecast is overly optimistic. Although the Federal Reserve has grown more hawkish, with more than 1 month before the next FOMC meeting, currency traders know that nothing will happen between and now and then. Therefore the central focus will be on the comparative hawkishness of other central banks such as the European Central Bank and the Reserve Bank of Australia, who both have monetary policy meetings next week.

the crap that the spinners attempt to sell to the public is still just that - crap

:hi:

[roamer65]

27. Just the upswing of the coming DOUBLE DIP recession.

Nothing more.

[Javaman]

29. oh we are sooooo in for a major hang over from this

"stimulus" bullshit.

:scared:

[high density]

30. So that means September or August numbers will have record drops

Can't wait to see the breathless reporting on that.