Your business goes bankrupt but you’ve still used the bank provided cash flow for payroll & the like. For personal investments it can work out the same way bec

Your business goes bankrupt but you’ve still used the bank provided cash flow for payroll & the like. For personal investments it can work out the same way because the interest rate on the loan can be negotiated to a much smaller level than what is available to normal people if you have a lot of money. So as long as you make a reasonable bet that your fairly liquid investments (stock in a public company is really liquid) can return more value than your loan repayment. There’s some risk but it’s not that insane and it’s manageable. > At the point of consumption is where the best place to tax occurs. Keep in mind that sales tax still exists but it’s a flat rate and is thus what’s called a regressive tax (vs a progressive income tax). So a rich person using a collatorized loan against their stock portfolio is going to pay less relative tax than a normal person receiving income who paid both income tax & the same sales tax amount. Yes there can sometimes be a luxury sales tax but all that means is that goods that normal people wouldn’t even be able to afford in the first place have a marginally higher tax rate.