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To: ralfph who wrote (138790)	12/10/2008 10:30:23 PM
From: Rocket Red	Read Replies (2) \| Respond to of 312651

tax loss selling is over

To: ralfph who wrote (138790)	12/11/2008 11:11:58 PM
From: riversides	Read Replies (1) \| Respond to of 312651

received this by email, Tax loss selling Since July 1st the Toronto Stock Exchange Venture index is down over 70%. Incredibly it was already down considerably from the prior 12 months before this decline. The index has never traded at these levels when compared to the price of Gold.. These ongoing declines are a result of the world wide financial crisis’ extreme acceleration in the fourth quarter, risk adjustment, and tax loss selling. Tax loss selling is a major factor in Canada because liberal tax loss laws allow investors to recover taxes paid in prior years by taking losses this year. In the US an individual can only carry them forward and only a small percentage of these losses can be applied over a number of years against that year’s capital gains. However some resource funds and corporations are also allowed to carry back their losses to prior year’s gains and thus receive back past taxes paid. This undoubtedly has a greater effect on natural resource asset prices than just individual Canadian sellers. I expect this is going on in many business types. Many US home builders are doing just that by dumping land at depressed prices below their cost to carry back the loss and get refunds from the government from the golden years of inflated profits. Much of the main stream press has focused on the lost tax revenue at both the state and federal level in future years as a result of less tax revenue. Another problem is the amount of tax refunds for prior year’s gains that will also add to the state budget shortfalls and federal deficit.