Ban really rich people from getting loans.

[-]

TheAzureMage@reddit

How's the bank going to know about every asset you have?

[-]

RedditThrowaway-1984@reddit

You have to enter it on the application for the loan. If you falsify this you are committing fraud.

[-]

CharacterSchedule700@reddit

It would not be considered fraud if you understate your assets and still get the loan. Fraud has to be done with the intent to deceive in order to gain something.

Unless of course you mean it would be fraud in this hypothetical world where people with more than 100m cant get loans. Then agree.

Also, I agree that OPs idea is terrible.

[-]

RedditingAtWork5@reddit

The reason the country and world will never improve is that improvement relies upon the ultra rich willingly giving up wealth and power. Ultra rich and ultra powerful go hand in hand.

[-]

TemplarTV@reddit

Good one.
Limits should also be imposed on how much wealth a Person or a Family can hoard.

[-]

Why? Its not like you can have enough money for one. Two lets say you start a business and you maintain 51% or more so you have a controlling stake. If that business ever becomes successfull what then? If there is a hard limit how can people ever find success?

[-]

TemplarTV@reddit

When Limit is reached, the money/profit is funneled to those below.

[-]

JSmith666@reddit

What did those below do to deserve it?

[-]

LiberaceRingfingaz@reddit

There comes a point at which that question flips to "what did those above do to deserve it?"

You can start a business based on an incredible idea and it can grow into something sizeable and, you can make tens or hundreds of millions of dollars, and you deserve it, because you created value.

You cannot grow to earn tens of billions of dollars without simply exploiting those below you to generate more profit.

An online bookstore that revolutionizes how products are ordered and delivered is an innovation. An online retailer that profits immensely by growing so powerful that it actively destroys any independent business, squeezes it's suppliers to the point of breaking while simultaneously ripping off their products and selling them cheaper, and running warehouses where humans literally die on the floor and everyone else is told to keep working is a preposterous and disgusting cancer.

Point being, it's one thing to get rich off of a good idea with great execution. That creates value. It's another to get unfathomably rich by exploiting everything and everyone below you. That extracts value.

There is no way to earn billions of dollars while still doing something useful to anyone other than yourself.

[-]

JSmith666@reddit

Not liking working conditions doesn't mean you are exploited. Working conditions are like pay. You negotiate them based on your value as a human being to the world. The more valuable you are...the better pay and conditions you can get. In no way exploitation. Now you created a situation here people who have a moderate amountof success did so in a way you find wrong so you udont care if you cause them financial harm.

But let's say you take their money...that doesn't mean others deserve it. Just because a person has a want or need that is unfulfilled doesn't mean they are entitled to it.

[-]

LiberaceRingfingaz@reddit

So what is it that makes you think Bezos deserves that money?

[-]

JSmith666@reddit

By owning significant amounts of shares of a company that has Amazon's valuation. Shares which have increased in value in large part to the fact a fuck ton of people e joy the goods and services Amazon provides.

[-]

LiberaceRingfingaz@reddit

Jeff Bezos came up with an idea that revolutionized bookselling, and an increasing pyramid of people below him came up with ideas that turned it into what it is today, and what it is today literally could not exist without extracting value that is not earned or deserved from everything they touch.

Look, I am formally educated in economics. I objectively understand what you're saying and am not disputing how the system works. What I'm saying is that at some point Amazon shifted from new ways of providing value to new ways of extracting value, which is the point at which the motherfucker should be taxed.

We may have fundamentally different ideas of what society should look like, but I'm also willing to bet good money that whoever you work for is getting richer off of whatever you do than you are. That's the line.

[-]

JSmith666@reddit

How are you splitting providing from exteacting value. What about people who get more in taxes funded benefits than they pay in taxes. Do they not extract value. Based on your logic they should be taxed more. Yes...because my boss has more value as a human being. They have skills and experience i dont. They are harder to replace then me. I dont hate them because I lack the worth they do. Supply and demand applies to people too.

[-]

TemplarTV@reddit

They did all the non-paperwork work.

[-]

TemplarTV@reddit

The broken system is why we have CEO's who make more in a Month thene Workers below them make in a Year.

Should a CEO earn more then a Worker? Yes.
But with reasonable limits.

[-]

JSmith666@reddit

There shouldn't be limits. Now do i personally think CEOs should make as much as they should? No but i feel the same about a lot of professions. The market sets wages and the govt should stay out of it.

[-]

Boomer_Madness@reddit

If the walmart CEO took $0 as pay for the year they could afford to give roughly every employee an extra huge, whopping, massive pay increase of $15 per YEAR. I can't believe they are being that selfish. The absolute GALL when they could give that $15 to each of their employees as a nice little christmas bonus or something.

[-]

JSmith666@reddit

Okay why are those employees entitled to that pay increase? If you stock shelves for example that job isnt massivley different at walmart than a small mom and pop shop. How is it selfish of the CEO but not selfish when the employees want more money without doing anything to earn it?

[-]

Boomer_Madness@reddit

I was being facetious lol i agree with you.

[-]

TemplarTV@reddit

So the only Limit is Human Greed?

[-]

JSmith666@reddit

No...the limit is what people are willing to pay.

[-]

Exile4444@reddit

I mean loans is the primary way banks make their money

[-]

Big_Tie_3245@reddit

Good, fuck em.

[-]

launchedsquid@reddit

you know you're speaking about yourself in that "...'em", don't you? Because if money stops being a thing we're all of us completely fucked.

[-]

Big_Tie_3245@reddit

Eh, I haven’t ever taken a loan, and I use banks as sparingly as possible. Im not saying stop money. Im calling for banking reform. Stop allowing banks to own property and loan imaginary funds without limits.

[-]

Exile4444@reddit

The economy literally cannot function without banks. Please educate yourself on the basics before making such misleading statements

(unless you are a hardcore c**munist or a hardcore anarchist)

*censored because of automod

[-]

573717@reddit

What should I search for to learn more? All I want a bank to do is hold money for me. I'd love to know why they do so much other stuff.

[-]

Big_Tie_3245@reddit

And I have some very hardcore anarchist beliefs mixed into some democratic beliefs, amongst other beliefs that may be more libertarian. I don’t think that banks should be able to make as much money as they do with as few restrictions as they have. Every financial crisis in essence has boiled down to bank failure of some degree. If they are so essential they should be more stable and efficient.

[-]

Big_Tie_3245@reddit

They can, and have, however operate with more restrictions on how far they can imagine money.

[-]

launchedsquid@reddit

Do you ever use money? Would your life really be improved if it was literally actually worthless? like kids playing with stacks of millions to build barbie and GI Joe houses because a wheelbarrow worth couldn't buy a loaf of bread worthless?

Do you really own so much land you can grow all your own food?

[-]

Exile4444@reddit

The economy literally cannot function without banks. Please educate yourself on the elemantaries before making such statements

[-]

AutoModerator@reddit

Your post was automatically removed because it contains political content, which is off-topic for /r/CrazyIdeas. Please review the subreddit rules and guidelines.

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

[-]

saul_schadenfreuder@reddit

based

[-]

DFLDrew@reddit

Loans are the primary way money is created. You can’t have a modern economy without fractional reserve banking

[-]

One_Recover_673@reddit

So Tesla, spaceX, Block and many huge companies just wouldn’t exist?

[-]

GESNodoon@reddit

I like this idea. What is they want to buy something that costs more than they are worth though?

[-]

LtHughMann@reddit

I think loans taken out against assets should be taxed as income if your net worth is above a certain amount. Fair enough the interest they pay on said loan is deductible.

[-]

ProlificProkaryote@reddit

Just git rid of the step up basis for large enough estates.

If they want to keep their company ownership or think it will appreciate more, they can take it an the loans they want, it will only result in them paying more interest and taxes.

Only reason that's not the case is because of the step up basis when they die.

[-]

justcommenting98765@reddit

The reason step up basis exists is practicality.

For many assets, how do you know what the cost basis is?

I think we should index the cost basis to inflation and then consider taxing capital gains as regular income.

[-]

rhino369@reddit

You'd probably have to lower the estate tax a bit (or create some sort of deduction), but that is a more fair way of doing it.

[-]

deleted_by_reddit@reddit

[removed]

[-]

AutoModerator@reddit

Your post was automatically removed because it contains political content, which is off-topic for /r/CrazyIdeas. Please review the subreddit rules and guidelines.

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

[-]

steelfork@reddit

Some sort of deduction. Like the 15 Million deduction for individual and 30 Million for couples we already have?

[-]

Cerulean_IsFancyBlue@reddit

Yeah the content fight against inheritance tax is bad enough. The basis reset is overpowered. As always, we can keep it for “small” amounts, lest the poor farmers once again become the poster child for why property tax is bad.

[-]

EarningsPal@reddit

This would have to apply to all countries and all banks. If there is even one bank giving away cheap money, they richest will send someone that works for them to figure out how to get that cheap money.

[-]

inlined@reddit

Don’t tax the loan, force appreciation of the collateral

[-]

Independent-Fruit4@reddit

there’s a limit to how much a bank can loan out

[-]

Vito_The_Magnificent@reddit

That's true, they have reserve requirements.

And the reserve requirement has been 0% since 2020.

[-]

Neither-Way-4889@reddit

Well, yes but its also kind of disingenuous to say that without providing context. Banks still have liquidity requirements and are limited in the type of investments they can make with their capital.

The fed shifted from flat cash reserve requirements to liquidity requirements vs losses in 2020, so its more like shifting from one system of risk management to another, not a complete abandonment of risk controls.

[-]

174wrestler@reddit

Most loans don't come from banks, but from investors, e.g. buying bonds.

[-]

ThePlatinumPaul@reddit

So you really hate the idea of things like homes or apartment buildings being built huh? Or factories, farms, etc.

But hey, you can slap a Che sticker on that burning trashcan outside your tent as you boil some grass water to eat. That's the end game of that kind of thought process.

[-]

Wyvernz@reddit

I think loans taken out against assets should be taxed as income if your net worth is above a certain amount.

That just causes double taxation - income tax for loan plus income tax for the money used to pay off the loan. If you’re in the top tax bracket in a state with 50% total income tax you’ll be paying 100% tax rate on that loaned money (50% on the loaned money, 50% on the regular income).

[-]

LtHughMann@reddit

Elon Musks net worth is over $600 billion. He has not been taxed as though he has earned that much income. When people like him effectively spend massive unrealised gains by proxy through a loan using those gains as collateral they absolutely should be taxed on it as income. It is not double taxation since they never paid tax on it in the first place.

[-]

Extension-Abroad187@reddit

This isn't how percentages work, nor how progressive tax rates work even in this worst case the highest rate would be 75%

[-]

Big_Tie_3245@reddit

Kinda like the double taxation on everything else? Tax income, then tax what that is spent on, and if it lasts a year then tax it again as property tax. If you have a model T in decent shape, it has cost more in taxes at this point than to buy it new. Why would tax value ever supersede actual value because a person cares for their property rather than ruins it?

[-]

Bulky_Wind_4356@reddit

Would that apply when you get a mortgage or refinance?

[-]

LtHughMann@reddit

Presumably it would only be for loans against assets you already own, not ones you're getting a loan to buy. More like using stocks to as collateral for a loan. Either way if you're net worth is below a threshold that effectively excludes anyone that isn't ultra wealthy it's not gonna matter either way.

[-]

Exile4444@reddit

What

[-]

jaspersgroove@reddit

Love it, half the money those guys move around doesn’t even exist anyway, they’re all just playing 3 card monte and leaving others holding the bag every time the economy tanks.

[-]

RedditThrowaway-1984@reddit

Sure, tax loans as income even though you have to give the money back. If you had to give your paycheck back would you be OK if it was taxed anyway?

[-]

NoxiousVaporwave@reddit

If you’re taking out loans against your assets, and have no income on paper then yeah, absolutely.

Really we should just get rid of security-backed loans. All it does is allow people to dodge capital gains tax, and income taxes for the richest people.

Only physical property should be able to be used as collateral.

[-]

EndonOfMarkarth@reddit

That is 100% not “all it does”

If you want a permanent oligarchy, this would probably be the most effective way to do it.

Me and two other chemists discovered and patented a new compound to treat cancer, how do I scale up without being able to borrow using my IP as collateral?

[-]

TheTrueKingOfLols@reddit

“ah yes, this extremely fringe edge case that may have never happened a single time, what about this hmmmm? What if I live in a world of no nuance and this one in a trillion thing happens???”

[-]

d1squiet@reddit

Dude. It’s not fringe at all, most private loans are business loans. Haven’t you ever watched Shark Tank?

That said, I think there are ways to at least curb the loan tax avoidance. Rules around appreciation of assets and such. So in with you, even though you’re making it sound simpler than it is.

[-]

EndonOfMarkarth@reddit

What are you talking about?

[-]

BigRichard1990@reddit

No, security backed loans let people dodge ordinary income tax while they wait for the holding period to be a year. Then sell and pay the capital gains rate.

How about we let lenders decide what’s an efficient use of capital considering risk and return? Let people with no skin in the game just watch and learn.

[-]

ski-dad@reddit

Great, centimillionaires can just buy a portfolio of single family homes and take a loan against it.

[-]

NoxiousVaporwave@reddit

You say that like this doesn’t already happen.

[-]

JohnHazardWandering@reddit

Buy, defer, die.

Pay no taxes.

[-]

allenrfe@reddit

What problem are you trying to solve here?

[-]

leafcathead@reddit

There is no problem trying to be solved, OP likely just thinks wealthy people should be punished for being wealthy, regardless of the consequences from this policy.

[-]

BroadwayBrick@reddit

Agree.
These people on Reddit have a ton of anger built up inside. I feel like 90% of the posters on this type of topic live in a parent’s basement or have no drive or motivation. It feels like they want to live off other people’s hard work.
I find Reddit insightful and educational on our current sad state of the world.

[-]

deleted_by_reddit@reddit

[removed]

[-]

AutoModerator@reddit

Your post was automatically removed because it contains political content, which is off-topic for /r/CrazyIdeas. Please review the subreddit rules and guidelines.

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

[-]

FordMaleEscort@reddit

Tax avoidance by the ultra-wealthy.

[-]

DoctorNerfarious@reddit

One thing I find amusing about modern society is that people seem to be so against discirmination but actively advocate for it against anyone with money, as if it is morally correct.

You'd have to rewrite all regulation to facilitate something like this and by doing so introduce a near unmanageable grey area, all based on open and active discrimination.

[-]

BBWolf326@reddit

People are against punching down. Someone with 100 million is not hurt by our criticism of their wealth. Stop glazing the rich. They don't care about you.

[-]

DoctorNerfarious@reddit

You're against punching down, and I am against punching.

It isn't about glazing the rich or them caring about me. It is about double standards, consitency, and real life. You couldn't make a policy that precludes rich people from lending.

Part of the reason banking services are free is because rich people make the bank a lot of money. Therefore, you don't need to pay for an account, pay for the app, see any ads anywhere, pay to deposit./withdraw, pay for direct debits, pay for receiving funds, to POA for your parents. You actually don't have to pay for a single thing to spend your entire adult life with access to full financial services. Not 1 penny. And part of that is because rich people take out fat loans that make bank for the bank.

The suggestion is stupid, wouldn't work in practise, is discriminatory and everyone who makes suggestions like this is totally incapable of fathoming the implications of what they're suggesting.

[-]

BBWolf326@reddit

It's not that serious. The double standard is that the rich are a lower percentage than the poor, so yes you are in fact glazing. Thick ropes.

[-]

deleted_by_reddit@reddit

[removed]

[-]

AutoModerator@reddit

Your post was automatically removed because it contains political content, which is off-topic for /r/CrazyIdeas. Please review the subreddit rules and guidelines.

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

[-]

divat10@reddit

People are only against discrimination of things other people have no control over. Loek race or gender.

Other forms of "discrimination" are everywhere

[-]

BroadwayBrick@reddit

That is so silly. That 100 million may be in corporate stock or investments.

Putting ridiculous laws or expectations on people is the first thing this OP would most likely complain about.

[-]

astreeter2@reddit

Won't someone think of the poor 100 millionaires? It's just not fair!

[-]

deleted_by_reddit@reddit

[removed]

[-]

AutoModerator@reddit

Your post was automatically removed because it contains political content, which is off-topic for /r/CrazyIdeas. Please review the subreddit rules and guidelines.

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

[-]

Good_Educator4872@reddit

Rich don’t use bank loans as we peasants think of lending. The borrow against investments from brokerage or investment banks. They are in a whole different universe of financial products

[-]

Subject_Ad3837@reddit

Banks prefer to give loans to richer people because they view it as lower risk than lending it to poor people who might not have the means to pay it back. The point of banks giving loans isn't to be charitable, but to make profit.

[-]

flopsyplum@reddit

Really rich people would hide their wealth in offshore accounts...

[-]

Bluethong9@reddit (OP)

Don't they do that already?

[-]

flopsyplum@reddit

Yeah, that’s my point.

[-]

PABLOPANDAJD@reddit

What do you think this would accomplish?

[-]

RedditThrowaway-1984@reddit

I can answer that. It would deprive the economy of investment capital. This would shrink the economy resulting in job losses, lower GDP and lower everyone's standard of living. Anyone arguing otherwise doesn't understand economics.

[-]

BikeInformal4003@reddit

Where would the investment capital go?

[-]

RedditThrowaway-1984@reddit

It just wouldn’t be borrowed in the first place. Due to fractional reserve banking, more than 90% of the money lent is created by the bank loan. If the loan doesn’t happen, the new money isn’t created.

[-]

BikeInformal4003@reddit

I don’t think OP is talking about loans for business investments. I believe he means loans for personal use. But I may be wrong

[-]

RedditThrowaway-1984@reddit

It doesn’t really matter. If a rich guy borrowed money to spend instead of liquidating another investment like stocks, there is still a net increase in capital in the economy.

[-]

PABLOPANDAJD@reddit

“I’m ok with everyone’s lives getting worse as long as rich people suffer”

-OP probably

[-]

depkentew@reddit

That is unironically the belief of many redditors. Crabs in a bucket mentality

[-]

ortolon@reddit

Our tax problem is not that we need more innovative, out of the box ideas. The problem is the Big Lie of trickle down.

Before we try to brainstorm specific ideas, we need to get people on board with the basic idea: raising taxes on the rich.

We need to first demolish the triumphal arch of Reaganomics. It's creating a traffic bottleneck that can't be solved with clever signage and public service announcements.

[-]

The_Matias@reddit

Why don't we just tax unrealized gains? Everyone says it's crazy. I don't understand what's so crazy about it.

[-]

deleted_by_reddit@reddit

[removed]

[-]

AutoModerator@reddit

Your post was automatically removed because it contains political content, which is off-topic for /r/CrazyIdeas. Please review the subreddit rules and guidelines.

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

[-]

Darth_Skeptus@reddit

Do you want inflation to go down or something?

And let's make PE firms have to take out loans on their own head, not the business they are buying. That way Chapter 11 isn't a business srategy.

[-]

chaircardigan@reddit

God but Reddit really hates rich people.

[-]

vitringur@reddit

I want to lend rich people my money.

Why are you banning a poor person from making money off of rich people?

[-]

sonicjesus@reddit

The economy would collapse in a matter of days.

Every product, job, apartment and car loan stem from a rich person borrowing money.

[-]

BikeInformal4003@reddit

That’s an insane take

[-]

Kittymeow123@reddit

People who are worth $100 million do not have that sitting in liquid cash. For someone like Elon Musk he is using the leverage of his shares of Tesla, which are worth a significant amount of money to take out a loan to have liquid cash.

[-]

LoneSnark@reddit

We don't have to do anything crazy like that. Just close the loophole and the rich will pay their taxes. The US law should be changed to make capital gains taxes due the day before anyone dies or transfers ownership of any asset as if they were sold. Playing the loans trick doesn't work nearly as well when they can't get out of their capital gains.

[-]

FordMaleEscort@reddit

Just fix the estate tax

[-]

aguafiestas@reddit

Why?

[-]

First-Expert-9953@reddit

Wealthy people who don't draw a regular paycheck don't pay income taxes. A wealthy person who makes their money buying and reselling things pays a capital gains tax instead, a tax on the profits they made from selling things.

Sometimes what wealthy people do for spending cash is to take out a loan instead of just selling off assets. If they sell assets, any profits are taxable. If they take out a loan instead, they get an infusion of cash without having to pay taxes on it. The bank's interest rates for repaying the loan are lower than than they'd pay on taxes, and whoever inherits the property when the wealthy person dies won't have to pay a capital gains tax on it.

[-]

Lanracie@reddit

This idea has promise.

[-]

Budsygus@reddit

Yeah, telling banks they're no longer allowed to make money off their lowest-risk customers is gonna be a hard sell.

I like the idea, but without completely abolishing capitalism it's a non-starter.

[-]

AutoModerator@reddit

Your post was automatically removed because it contains political content, which is off-topic for /r/CrazyIdeas. Please review the subreddit rules and guidelines.

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

[-]

trying3216@reddit

That’s a violation of rights

[-]

beachbum818@reddit

Lmao... how would you construct a building or a stadium? If it costs $500 million to build a building but you're worth $100 mil you can't get a loan? That's dumb

[-]

dargmrx@reddit

Somehow op’s idea isn’t the crazy thing here, reality is.

[-]

MordaxTenebrae@reddit

I was going to argue against you because loans are necessary for large scale business investments, but our entire modern monetary system is built off of debt which is actually insane if you consider it.

Before, it was based on IOUs for gold that didn't actually exist, but now it's IOUs for essentially monopoly money that every agrees is valuable.

[-]

DFLDrew@reddit

What do you think an IOU is? Debt. Economies have always been debt based, barter based economies cannot function for obvious reasons

[-]

MordaxTenebrae@reddit

I was speaking more towards fractional-reserve banking when I referred to IOUs for non-existent gold, which is a \~Middle Ages development.

I.e. hypothetically 10 bars of gold exist in your economy, but you loan out 100 bars of gold to everyone.

[-]

rhino369@reddit

Getting people to work today for a payment later is incredibly useful. It would be insane not to use it.

[-]

uatme@reddit

just make corporations not people

[-]

beachbum818@reddit

But not every person has a corporation lol. So you want them to utilize a loophole... create a shell corporation to access loans? At that point just let individuals get the loan lol

[-]

ecrane2018@reddit

Individuals don’t usually get loans for 500 million anyways. It’s all done through corps

[-]

Extension-Abroad187@reddit

It costs like $200 to start a corporation. That would render this rule useless

[-]

LordMoose99@reddit

God why do people keep bringing this up like its ever been a thing.

If you legit belive this go actually read Citizens United vs FCC

[-]

uatme@reddit

it was just joke that applied in this context. In this case the idea is rich people can't get loans. Rich people aren't building buildings or stadiums...

[-]

EarningsPal@reddit

Then the rule is useless. It’s just paperwork for a workers to the rich.

I can’t get a loan? Ok, Tim, go do the paperwork to open a new company and get me a cheap loan.

No change.

[-]

matt95110@reddit

Then don't build it.

[-]

BigDaddyDumperSquad@reddit

You do realize how much things like that effect the local economy, right? It brings a lot of people into town, fills hotels, boosts local restaurant business, helps push for better public transportation systems, etc.

You need to zoom out a little and see the bigger picture.

[-]

matt95110@reddit

A new stadium helps no one. And the team and owners can afford it.

[-]

BigDaddyDumperSquad@reddit

Okay, nevermind. 🧱 🤦

[-]

matt95110@reddit

Ya that’s right.

[-]

AutoModerator@reddit

Your post was automatically removed because it contains political content, which is off-topic for /r/CrazyIdeas. Please review the subreddit rules and guidelines.

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

[-]

integer_hull@reddit

Stadiums are largely taxpayer funded, as most things of this nature should be. More broadly speaking, loans are for people with good ideas that need a leg up. If you’re a centimillionaire you don’t need a leg up. Find the funding yourself.

[-]

FadeIntoReal@reddit

Taxpayer risk, billionaire profit. Great system.

[-]

integer_hull@reddit

I mean, we’re in a hypothetical system where rich people don’t get loans. I’m sure the taxpayer can get free tickets too.

[-]

Far_Adhesiveness_194@reddit

So banks shouldn't loan to the people who are least likely to default. Sounds like loans will get more expensive as the default risk of their portfolio rises.

This isn't a case of some billionaires got loans, so there's no money left to give you a loan on your mobile home. Be more responsible with your money and you will get more loans.

[-]

Big_Tie_3245@reddit

Don’t allow loaning of money not currently held. Stop the banking system running on hypothetical assets

[-]

Far_Adhesiveness_194@reddit

You really don't want loans to be issued, do you? Double entry bookkeeping is how loans happen, and how our economy grows. Taking that away means our economy will crash.

[-]

Big_Tie_3245@reddit

Adding that money ad infinitum is how we end up with severe devaluation of the dollar as well. They printed so much covid money to stimulate the economy, and it do, but once it all settled there were just more dollars in certain bank accounts and everything costs more now.

[-]

Far_Adhesiveness_194@reddit

There's a difference between the Fed just blindly printing money, and banks issuing loans. I agree with you in that the Fed printing money for no justified reason is a big problem.

[-]

Big_Tie_3245@reddit

And no, more that I want to see banks stop owning so much. Loan imaginary money, and when it defaults take legitimate capital. Then use that capital to make as much as possible as a fiduciary duty to their shareholders, thereby making housing unattainable for many while bank owned homes sit empty. If you have a legitimate reason to need a large loan, shark tank that shit. Find sources of revenue by proving your idea meritous as opposed to checking your credit and assets and seeing what you can take when it fails. Incentive to issue loans that result in acquisition of properties at submarket rates is not a good system.

[-]

PlayPretend-8675309@reddit

No one buys anything expensive without a loan. This policy would grind the economy to a halt.

[-]

Phase4Motion@reddit

“Expensive” is subjective. Additionally, the focus of the post would be to tax personal loans rather than a mortgage for example.

[-]

sneezhousing@reddit

Net worth and cash on hand are two different things. Your houses worth is included in your net worth, stocks you own but have not cashed out included in net worth, business owner the worth of business can in certain instances be included in net worth. However that business may need cash to grow so they need a loan. Of ot they will have to sell off equipment and or fire people to get the cash to grow which makes it so they actually shrink.

Net worth is tricky number it doesn’t mean you have cash on hand. Your 401k balance is included in that but you can't touch that until you retire

[-]

New-Smoke208@reddit

Why? Would that help you out in some say? Or do you just want to hurt the rich? Wouldn’t that cause banks to lose millions of dollars in interest from mega loans that they otherwise would receive?

[-]

MelonElbows@reddit

Don't let them get insurance either. The time when I realized how insane this is was about 5-10 years ago during March Madness. Warren Buffet of all people, decided to have this promotion where if someone guessed the MM brackets correctly, they'd win a billion dollars. But I found out later that it was insured, he took out insurance in case someone actually did win the money. Something that is statistically less likely than winning the lottery and this man, probably one of the top 10 richest people on earth, took out insurance instead of just putting up $1 billion in cash of his own money. And honestly, even if he lost that billion, his lifestyle wouldn't have changed at all. Fuck that guy and fuck rich people. They shouldn't be able to get insurance. No loans, no insurance, if they want something, force them to buy it in cash.

[-]

DFLDrew@reddit

Wow! This is the most financially illiterate take I’ve seen in a long time.

Did you know Warren Buffet was the CEO of Berkshire-Hathaway which owns Gieco outright? The whole thing was for marketing. Same thing with the Jordan’s Furniture promo where furniture was free if Red Sox had a perfect game (or something like that). To construe that into an argument that insurance is bad is weird and hilarious.

[-]

Melohdy@reddit

Soooo, no loan to open a company which employs thousands?

[-]

Gothmog356s@reddit

What star up employs thousands?

[-]

Nervous_Hurry_9920@reddit

Uber had 6000 drivers within 6 months.

[-]

uatme@reddit

I like how you didn't use the word employee

[-]

Nervous_Hurry_9920@reddit

Yet all of them are employed. The question didn't asked "which start-up has a thousand employees".

[-]

Gothmog356s@reddit

And none of them were considered employes

[-]

Nervous_Hurry_9920@reddit

Yet all of them are employed

[-]

Melohdy@reddit

Who said anything about "start ups"?

[-]

OldEquation@reddit

How many businesses employed thousands on the day they opened?

[-]

atom644@reddit

No use the money you already have. Bootstraps

[-]

Exile4444@reddit

So would you also advocate for the ban of public stock market shares if you are going against the idea of investment?

[-]

Bluethong9@reddit (OP)

What company has thousands of employees at its beginning?

[-]

zayelion@reddit

Ban using stocks as collateral is more in line with your goal. It prevents the formation of billionaires. Thier money can be growing or in their pockets. Gives them reason to finally walk away from companies instead of being stuck spending thier lives increasing profits to stay ahead of their loans.

[-]

CoastieKid@reddit

Banks would state that’s an infringement upon their pursuit of happiness

[-]

birdbud-@reddit

Reddit complains about rich people "hoarding" wealth but then cries when they spend it via loans.

[-]

JasonVoorheesthe13th@reddit

Net worth doesn’t equal liquid assets. Rich people with a net worth of 100 million might not have more than a couple million at most in liquid cash/assets. They use their solid assets like property and stocks as collateral for the loans and then use the dividends from the stocks to pay said loans.

If you own an average home your net worth may be around $400k while your liquid assets may be 10k in cash. Would you say you should be expected to sell your home in order to go buy a new car? Or should you be able to get a loan for that 45k car using your house as collateral through a home equity line?

This isn’t some game only the rich get to use, this is something available to anyone who owns a home or property and has positive equity in it.

[-]

greenskye@reddit

Just tax stock over a certain amount (ie. Anything over a regular person's 401k amount) yearly. We already tax property yearly and that amount increases with the estimated value of the property. So we are already taxing 'unrealized gains'.

I'm paying taxes on a property that is theoretically worth $250k more than I paid for it. The market could crash tomorrow and my house price could fall through the floor, but I won't get a refund on my previously paid taxes on it.

You can absolutely do this to wealth and you can also easily exempt an amount that most normal people will ever reach. I.e. the first 10 million in stock is tax free and anything above that is subject to this yearly wealth tax. Exactly identical to property taxes, something most people currently put up with.

[-]