It’s not like these billionaires are spending this money, so it’s just been invested for 7 years. What’s the old adage, Rule of 72? Given a 10% rate of return, they would be expected to double their money in…
…seven years.
While the tax policies certainly aren’t helping the majority of the population, let’s not pretend compound interest isn’t a thing.
It’s not as if that makes it any better. Tax policy should be designed to actively combat the inequality increase created by compound interest, not go along with it.
But, due to their investments they do invest it in large quantities, often spread over a large stock portfolio.
And if we had a fraction of a penny financial transaction tax, we’d get a ridiculous amount of money from the investor class and almost no one else would be affected.
That would mean less revenue, but stock traders would still make many transactions per day like they did before HFT, so it would still bring in a massive amount of revenue.
It’s not like these billionaires are spending this money, so it’s just been invested for 7 years. What’s the old adage, Rule of 72? Given a 10% rate of return, they would be expected to double their money in…
…seven years.
While the tax policies certainly aren’t helping the majority of the population, let’s not pretend compound interest isn’t a thing.
It’s not as if that makes it any better. Tax policy should be designed to actively combat the inequality increase created by compound interest, not go along with it.
But, due to their investments they do invest it in large quantities, often spread over a large stock portfolio.
And if we had a fraction of a penny financial transaction tax, we’d get a ridiculous amount of money from the investor class and almost no one else would be affected.
For a week, until all the quants do the math and realize HFT isn’t profitable anymore.
That would mean less revenue, but stock traders would still make many transactions per day like they did before HFT, so it would still bring in a massive amount of revenue.
Well yeah, significantly less (50% of all trades are HFT) but I see your point.
Wealth is not cash or cash equivalents though. They aren’t investing all of their wealth
Most of the wealth of billionaires is invested, often in the same vehicles used by everyone else (stocks, real estate, etc).