It is a day for repeating some material from old posts. I haven’t yet read any more than a few news reports on the Tax Working Group’s report. But I have debated capital gains taxes for years. This was a post on the topic from 2017. Here was the gist of my comments. My bottom-line is that capital gains taxes aren’t the worst thing in the world, but mostly are a distraction from what should be the real issues.
Anyway, here are some of the points I make:
- in a well-functioning efficient market, there are typically no real (ie inflation adjusted) expected capital gains. An individual participant might expect an asset price to rise for some reason, but that participant will be balanced by others expecting it to fall. If it were not so then, typically, the price would already have adjusted. In well-functioning markets, there aren’t…
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