I’ve seen in a few places that the super-rich can unlock their wealth ‘tax free’ by taking out a loan secured against their shareholdings or other assets, then use the cash from the loan to buy real stuff.
But how do they pay back the loan?
In: 196
The truth is they don’t. On a long enough timeline, asset values outpace the interest forever due to inflation. The rich take out loan after loan and never sell anything. They also don’t pay taxes. Once you are rich enough you can stay in the club forever if you’re not kicked out deliberately. It’s essentially socialism at the top
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