Will the US see an uptick in European/Caucasian Immigration?

[Yuri]

You don’t tax the wealthy as punishment. You tax them to keep public services working such as military, infrastructure, healthcare, education, allowing the whole society to have a minimal living standard and allowing the greatest number of people to reach their full potential, increasing even further overall wealth.

Without that, society might collapse or entering in non-stop social convulsions, destroying the whole system that allow people to become and remain multimillionaire in the first place.

[eschaton]

Originally Posted by yuriandrade

You don’t tax the wealthy as punishment. You tax them to keep public services working such as military, infrastructure, healthcare, education, allowing the whole society to have a minimal living standard and allowing the greatest number of people to reach their full potential, increasing even further overall wealth.

Without that, society might collapse or entering in non-stop social convulsions, destroying the whole system that allow people to become and remain multimillionaire in the first place.

There are other reasons to tax the wealthy besides that and punishment however. For example, given the wealthy save more and spend less, proportionate to their income, money redistributed from the wealthy to the poor actually results in higher levels of consumer spending - which should cause a higher rate of economic growth. Also things like an inheritance tax are often explicitly set up in part to limit the permanent concentration of wealth in given families.

[Yuri]

Exactly. Millionaires are important to the economy at certain level. After that, they just keep amassing money that sits idle.

That's not wrong per se, but if society understands that economy must always grow, preferably at a very fast rate, it's important that those money flows into the middle-class as it's much more productive.

About inheritance taxes, that's the most important tool to tackle inequality and promote a more perfect "meritocracy" by giving a nice education to everybody. What's the point to reward generations after generations that had the lucky to born rich but are otherwise unproductive and would never make it to their own?

[Handro]

I don't understand why middle class voters wouldn't want to try to re-capture the booming middle class success of mid-20th century. There were supremely rich people back then... I don't get this weird, servile capitulation to the mega-wealthy? Billionaires can still exist under a structure of high taxation to pay for things like healthcare and education. We can all have our cake and eat it too.

[Investing In Chicago]

Originally Posted by yuriandrade

Exactly. Millionaires are important to the economy at certain level. After that, they just keep amassing money that sits idle.

That's not wrong per se, but if society understands that economy must always grow, preferably at a very fast rate, it's important that those money flows into the middle-class as it's much more productive.

Are you suggesting Millionaires are stashing their money under their mattress?

[iheartthed]

Originally Posted by Investing In Chicago

Are you suggesting Millionaires are stashing their money under their mattress?

Low level millionaires aren't. Super millionaires and billionaires definitely are doing the equivalent of it.

[Investing In Chicago]

Originally Posted by iheartthed

Low level millionaires aren't. Super millionaires and billionaires definitely are doing the equivalent of it.

Can you please provide an example?

[iheartthed]

Originally Posted by Investing In Chicago

Can you please provide an example?

Billionaires Row

[Investing In Chicago]

Originally Posted by iheartthed

Billionaires Row

what about it?

[Handro]

Originally Posted by Investing In Chicago

what about it?

how many of those units are actually occupied?

[Investing In Chicago]

Originally Posted by Handro

how many of those units are actually occupied?

I don't know, and neither do you. How is that relevant? Are property taxes, for example, contingent on occupancy rate.

I'm guessing by the vague responses being thrown out, nobody has any idea what they are talking about.

[eschaton]

Obviously the rich invest the money they save, rather than just stuff it under a mattress. But - setting aside speculatory bubbles - investments can only grow in the longer run if the underlying economy is growing. Which means consumer spending has to grow, considering it makes up about 75% of GDP IIRC.

Basically, investment flows to where there is a market which can grow. But investment cannot cause markets to grow in and of itself.

[iheartthed]

Originally Posted by Investing In Chicago

what about it?

Wealth preservation scheme.

[Crawford]

The (non-sketchy/criminal) super-wealthy have their money in diversified portfolios, generally. They're spreading their money around. They generally aren't consuming much more than the merely wealthy, which is why the recent tax changes just resulted in bulked up portfolios.

[Handro]

Originally Posted by Investing In Chicago

I don't know, and neither do you.

On the upside, you won’t actually see these neighbors very often—because they aren’t here. According to the Census Bureau, throughout a sweeping stretch of midtown—from Forty-ninth to Seventieth streets, between Fifth Avenue and Park—nearly one in three apartments is completely empty at least ten months a year. In a revealing 2014 New York piece, which observed that real-estate ownership in the city “can be made as untraceable as a numbered bank account,” a developer concludes, “The global elite is basically looking for a safe-deposit box.”

https://www.newyorker.com/news/daily...in-apartment-b

Originally Posted by Crawford

The (non-sketchy/criminal) super-wealthy have their money in diversified portfolios, generally. They're spreading their money around. They generally aren't consuming much more than the merely wealthy, which is why the recent tax changes just resulted in bulked up portfolios.

Wait, you mean Jeff Bezos isn't spending $900M a year on groceries?

[Crawford]

That stretch of the East Side is almost exclusively inhabited by the wealthy (domestic and expat) and UN mission and consulate representatives.

Not exactly surprising that 1/3 of homes are vacant much of the year; that number, if anything sounds pretty low. If you have a co-op on Park it would be odd to not have at least one other home; and probably more typical to have at least two. I also doubt this is a recent phenomenon; in say 1980 I doubt the ratio was very different.

Superluxury real estate hasn't done well in the U.S. in recent years, so I don't think it can be argued that recent tax changes have led to the superwealthy rearranging their portfolios for more real estate exposure.

[Investing In Chicago]

Originally Posted by iheartthed

Wealth preservation scheme.

Now i'm confused. How is purchasing an apartment a wealth preservation scheme?

[Investing In Chicago]

Originally Posted by Handro

https://www.newyorker.com/news/daily...in-apartment-b

What point are you attempting to prove?

[Investing In Chicago]

Originally Posted by Crawford

The (non-sketchy/criminal) super-wealthy have their money in diversified portfolios, generally. They're spreading their money around. They generally aren't consuming much more than the merely wealthy, which is why the recent tax changes just resulted in bulked up portfolios.

Exactly. Super-wealthy (whatever the definition is) invest fairly similar to those who are just wealthy (again, whatever the definition is), just at an order of magnitude (or 100x) higher.

[iheartthed]

Originally Posted by Crawford

Superluxury real estate hasn't done well in the U.S. in recent years, so I don't think it can be argued that recent tax changes have led to the superwealthy rearranging their portfolios for more real estate exposure.

It's too soon to make that conclusion from the Trump tax cuts for sure, but it's not hard to see it lead to that. OTOH, New York City taxes on these places are absurdly cheap. Last weekend I saw some ads for $100M apartments and the taxes were like $100K a year. That sounds like a lot, but if you can afford a $100M apartment then you probably make at least $100K in a day. By comparison, it likely takes most middle class people a week or two to earn the annual property tax burden on their primary home.

Apartments that sell for eight or nine figures aren't the same as a middle class house. Someone whose primary residence is a house or apartment worth $500K probably has most of their net worth tied up in their home. If you're Michael Bloomberg and you own a $100M apartment, that apartment is worth as much to you as cheap $500 engagement ring would be to the owner of a $500K house. It's something he could park money into and forget that he even owns.

Sticking $100M in an apartment is a safer bet than sticking it into a checking account that will only insure an insignificant percentage should the financial institution collapse. You can insure a property for the full value.