[bmitc]

A mortgage of that scale isn't even remotely close to how the mega rich operate. How is that example relevant to a discussion about multimillionaires and billionaires? Such a mortgage requires a massive down payment via cash (that was taxed), a non-trivial interest rate, and monthly payments again with taxed cash. The tax rates of such income is likely higher than the capital gains tax. The mega rich get loans in the tens of millions all the way up to billions with paintings, watches, houses, unrealized investments as collateral at ultra low interest rates. They repay the loan with money siphoned off at low tax rates, such as through dividends and even other loans, while the things they used as collateral continue to grow unchecked in value. Like seriously, the capital gains tax is much lower than the income tax rate I pay. How the hell is that not whack if not totally fucked up? Do you think it's okay that the mega rich are incentivized to continue to get richer and richer while receiving the massively preferential loans and tax rates they get? What normal person is getting rich off of a 30-year mortgage, where payments on make up double digit percentages of their monthly income?

[Rebelgecko]

>Do you think it's okay that the mega rich are incentivized to continue to get richer and richer while receiving the massively preferential loans and tax rates they get?

I don't think the loan and tax rates are particularly preferential.

Thanks to his twitter deal, he's had to publicize some info about how he gets his money. The interest rates on his loans range from SOFR+3% to SOFR+10%. Those rates aren't that low— even as a non-millionaire I could get similar ones from my bank (https://www.schwab.com/pledged-asset-line).

I pay 2.75% interest on my mortgage. So even Elon's best loan has an interest rate well above my mortgage. By the end of the year, his interest rate is on track to be around 3x higher than my mortgage! And like my mortgage, his loan has a large upfront payment and a minimum amount that must be repaid every year, it's not free money forever.

My effective federal tax rate is 20%. That's lower than the rate that a typical billionaire would pay on capital gains (23.8%).