On the surface, the logic behind this latest Washington proposal 'sounds good' ... why should multi-millionaires get away paying taxes at a 15% tax rate when middle class people (like full time dancers) often have to pay taxes at a 30%+ rate.
But in the 'real world', multi-millionaires are not going to simply sit still and take this sort of a 'hit'. They are going to move their money out of these Private Equity Funds and move it into something else which offers a higher after-tax rate of return.
Since it has been Private Equity Fund buyouts of public corporations which has contributed (to a measureable degree at least) to higher stock prices, if the buyouts stop the stock prices will likely stop rising as well. Additionally, since these buyouts have in virtually every case left the corporations with much greater debt load in order to partially self-finance the buyout, the corporations are at much higher risk of facing bankruptcy if business levels / profits take a downturn.
really asks a lot of important questions along this line !



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