Comment by patrickg-zill | Hacker News Reader

Comment by patrickg-zill | Hacker News Reader

We know now, that the reason AIG was bailed out, is because European banks had $300 Billion or more in credit protection, and that the Euro banks are even more highly leveraged than US, Canadian, and British banks.

It was French finance minister Christine Lagarde who personally begged Paulson to keep AIG going.

See: http://www.telegraph.co.uk/finance/comment/ambroseevans_prit...

My personal view is not that bankruptcy is the answer; just that it will be the inevitable result.

The only question is whether a few large Wall St. firms will go bankrupt, causing pain to many other financial institutions and governments, or whether America itself will go near-bankrupt as a result of taking the losses on themselves.

And no, I don't have a lot of respect for Buffett, ever since he fought the inheritance (death) tax being repealed, which is after all double taxation, and from which his company personally benefits.

His insurance companies make billions on pricy insurance sold to small and medium sized business owners who are nearing the end of their life (you buy the insurance so that when you die, the company does not have to be liquidated in order to pay the IRS).

Old money fears new money. I was going to say old wealth fears new wealth, but with PG’s input on wealth… I think it would be better to say money. Or maybe even perhaps large money fears small money that has ingenuity that may become large money. Buffet knows where to stop his competition before it becomes a serious problem – Monopolist, or should say cartelist or oligopolists always have… sometimes I wonder how many wealth creators by innovation understand, or even think this as true.

What double taxation, if you buy stock at 10$ and it's worth 100$ when you die that gain is never taxed.

I encourage you to actually know what you are talking about before posting.

If I have $1 million in cash when I die, my heirs have to pay taxes on that, even though I paid taxes on it when I originally earned it. You cannot net out the capital gains and just pay tax on that, everything is taxed.

Your heirs didn't earn that money, so they're only paying taxes once. You pay once for earning it, they pay once for "earning" it via your departure from this earth. But presumably if you have lots of money, you've already set up trusts, paid for college, given lifetime gifts, etc. so your heirs are already pretty far ahead of the average person.

Seems like a perfectly good way to encourage at least a tiny amount of wealth redistribution in a society where wealth is not very well distributed at all.

It could be setup like that but it's not. You don't pay capital gains at the time of death and the people you give it to don't pay when they receive it so only some of the money is ever taxed.

PS: The really sick thing is giving stock to a charity: "By doing so, you never have to calculate gains nor list the sale as income on your tax return. Moreover, if the stock was held more than a year (long-term gain), you get to itemize the charitable deduction at fair market value on the date of gift." (http://invest-faq.com/cbc/tax-cap-gains-basis.html)

To find out why this is messed up calculate what happens when you give 100$ to charity now vs buying 100$ in stock that is worth 10x a much in 20 years. I had an aunt who was audited and ended up getting close to a million back because of this stuff.

Plus, you're ignoring the fact that there is a credit (which can be thought of as an exemption), which is different year-to-year, but not less than $1,000,000. I don't feel like going through all the details, but you can easily research this.

People need to read up on this stuff. There is a ton of FUD surrounding this issue.

I encourage you to not use an unnecessarily aggressive tone when posting ;)

First off I never spoke about cash I said the gain in the value of a stock that you buy is not taxed. (http://invest-faq.com/cbc/tax-cap-gains-basis.html) My point is covered under "You inherit a security" but reading the whole thing is useful.

Second, in you only leave 1 million in stock to your child they pay zero tax on that.

PS: There are a tun of way's the tax code helps high net worth individual. If you have 1billion in capital gains you pay 15% before deductions, but if you're a contractor making 10$ an hour you pay more than that to SS and Medicare let alone the rest of the tax code.

Earn money, pay tax. Save money, pay tax on the interest. Buy stuff, pay sales tax. Die, pay tax again.

I'd prefer just a single tax. Get rid of the unfair ones like inheritance tax which stops people getting on the housing ladder etc.

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