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Question I've had for a while. Assuming a wealth tax gets through, couldn't the wealthy just take out a loan at near 0% against their stocks to pay the bill?
by anonporridge 5y ago
Question I've had for a while.
Assuming a wealth tax gets through, couldn't the wealthy just take out a loan at near 0% against their stocks to pay the bill?
Could they get away without selling any stock at all?
Especially in an inflationary environment that many people think will get even more inflationary and a Fed that seemingly won't let the stock market crash.
- Rebelgecko 5y agoIn today's environment, yeah. But a few decades ago those loans would have interest rates more like 20%
- anonporridge 5y agoWouldn't the loans be fixed interest rates?
- Rebelgecko 5y agoAs far as I know, every sort of margin loan or pledged asset line of credit is indexed against the daily SOFR, LIBOR, or a similar benchmark (onto which the lenders add their profit margin, which is usually negotiable if you throw enough money at them). If you know any with fixed interest rates let me know, that'd be a helluva deal!