The political implications are rather serious with the Democrats in control of everything. Aside from the New Green Deal which they will come to realize will destroy so many jobs as they follow the directions of Bill Gates which will come back to bite them in 2022, they constantly want to punish people for making money. Raising the taxes to 40% on the top bracket is one thing. The real damage will be eliminating capital gains and any income becomes normal. So that family house you bought in the ’50s for $15,000 and sell for $300k, well that will put you in the top tax bracket and there goes 40%.
The elimi9nation of Capital Gains will also have a far greater impact upon investment going forward. It is an investment that is the lifeblood of economic growth. By eliminating capital gains, then the risks of capital investment are not offset by the better tax rate. This will have a negative impact on capital investment and will steer capital into less risky options.
We will be running our models on the impact of the elimination of capital gains, but it appears that this is the turning point where CONFIDENCE breaks in government and the system at large. If capital beginning to move into flight-mode, then we can expect some wild outcomes ahead in the global financial markets.