3 ms·

>> and inflate >> >> Inflation caused by excess money supply (NB: not inflation caused by excess money velocity) cannot survive taxation. Taxation destroys mon

• gus_massa 4y ago
  So you are actually proposing to raise taxes. The problems is that everyone hate that, and will avoid paying taxes and/or vote for the opposition party.
  • CraigJPerry 4y ago
    >> So you are actually proposing to raise taxes It depends - in the specific scenario of an incredibly expensive drug for small numbers of patients (and other problems with similar dynamics) then tax might not be the best solution. But in other cases yes. In this particular case the returns would go to successful investors - not historically a money user class prone to causing inflation (quite the opposite). In this case you may find that you don’t need any intervention - they might take their winnings and go speculate on more investments (great!). It may be that conditions are such that they don’t presently fancy investing, perhaps you could offer them inflation tracking risk free gilts/tbills to park in for now. However you would need to be ready for their choice to go on an inflationary non productive consumption spree. In which case - directed taxation should be applied.