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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Bob Rudd who wrote (16183)	1/18/2003 12:34:24 PM
From: jeffbas	Read Replies (2) \| Respond to of 78576

Bob, on the dividend tax break, is there anyone here who thinks this is better for the economy that a similar value capital gains tax cut on FUTURE investments? In my opinion, we want to encourage the companies that deliver growth to the economy (don't pay dividends) versus low/no-growth companies (ones that pay high dividends). We also want to encourage people to finance such growth companies with NEW investment. My idea costs nothing at all in year 1 (since no new purchase has been held for 1 year), and only gradually increasing cost in later years as new long term holdings gradually are sold (and zero cost if the market does not go up). Yet the benefits to the economy are front loaded. I would bet that elimination of the capital gains tax on new investments (which we in effect already have for houses) plus some kind of drug plan for the elderly would do more for the economy, cost less, and have a fairer distribution by income class (with the elderly getting a break which is more fairly distributed by income level than the dividend tax cut).