re: #538 cliffster

it’s not meaningless. Every investment is evaluated individually. I either kick my money in or I don’t. If taxes are higher, it makes me less likely to kick my money in, because my potential reward goes down. Yes, you are necessarily investing somewhere else in that case; see below.

It can make you more likely to kick your money in, though, if it’s a safer investment. That is part of the risk/reward moving around.

Money will indeed continue to be invested. As has been pointed out, burying your money in the mattress is an investment; it’s saying that you think that losing value to inflation is safer than other investments which would lose you even more.

Which nobody does. They buy bonds at the very least.

However, taxation causes investments that actually build the economy to become less attractive, and “investments”, that are actually hedges, to become more attractive.

Well, a lot of industries do nothing whatsoever to build the economy, and a lot to detract from it. You can’t blanket-claim that all investment is good for the economy, especially in the wake of the economic meltdown.

Right now, we have a huge emphasis on short-term profit over long-term. I would prefer a scaled capital gains tax that lowered every year you were invested, rather than poofing after a year.