ObjectivityIncarnate

It’s not a “fairness argument”. I’m not arguing some subjective value judgment of mine, to be debated.

If you expect your roulette bet to pay out when you win, you’d better believe it’s part of the arrangement that the casino is not going to give your bet back when you lose. You can’t get the payout without the risk of loss; similarly, that’s how owning stock works.

So if you as a worker want the benefit that comes with your employer’s company’s net worth going up (which many workers do in fact get, it’s not that rare for stock to be part of a compensation package), it is only fair that you also accept the possibility of being on the hook if it goes down (which is what happens if you’re paid in stock whose price goes down after you receive it).

You can’t have it both ways.

Why not make a law against using unrealized capital gains as loan collateral?

Because that would outlaw home equity loans, for one thing. Anything you own that’s increased in value since you started owning it is “unrealized capital gains” by definition, until/unless you sell it, not just stocks.

The fact is, taking a loan out using stuff you own as collateral, regardless of what it is, is a perfectly normal thing to do that in itself deprives no one of anything. Lenders aren’t in the business of throwing money out the window—they make these loans because they get repaid, and then some. Someone who takes out a home equity loan and uses the money to renovate their house so that it’ll sell for an increased price beyond the loan amount + the interest rate, is making the exact same ‘move’ as someone who takes a loan out using their stock in a company as collateral, and uses that money to do things that make that stock increase in value beyond the loan amount + the interest rate.

Explain how your “point” makes any sense

It is a fact that net worth changes are not an injection of cash money, and it is also a fact that profiting when the net worth of the company you work for goes up, is only a fair arrangement if you also are on the hook when the net worth goes down. To restate the simple analogy:

Wanting only the upside is like demanding that your roulette wheel bet should pay out normally if you win big, but should be refunded when you lose.

These are plain facts. Explain precisely how either of those doesn’t make sense.

How is it ‘fair’ to make poor people pay to cover up the fuckup of a multi trillion dollar company?

It’s not, if said people aren’t being paid in company stock. However, if a worker expects to benefit from the net worth going up, they should expect to be on the hook when the net worth goes down, too. You can’t have it both ways; that would be unfair. You want the benefits of being compensated in stock without the risk that owning stock inherently carries, namely the volatility of its value.

Then the stocks used as collateral should be taxed as realized gains.

Why? They haven’t been realized. Literally nothing happens to collateral unless the loan is defaulted on. Do you think you should your house should be treated as realized gains (i.e. the same as if you sold it), if you take out a home equity loan?

we could make it so that it only applies to loans over some arbitrary amount…(within a certain time period to counter multiple smaller loans as loopholes)

This is literally impossible to realistically enforce, total waste of resources and effort to even try. Myriad ways to spread it out over different people/entities/etc.

My point still stands in its entirety. Consider actually thinking about it instead of imagining me fellating people.

Those loans are their main source of income.

Loans aren’t income. They only reason this ‘move’ works at all is because they are creating value at a rate that exceeds the interest rate + inflation. Other than the scale of the ‘tactic’, it’s no different from taking a home equity loan to improve your home so that the amount it sells for has increased by more than was lost from the interest on/repayment of the loan.

Realize that the lenders giving these ultra-wealthy these loans are not in the business of throwing their money out the window for fun. They make these loans only because they get repaid, with enough interest to make being without those funds in the meantime worth it for them.

People don’t take out home equity loans to spend on groceries, maids, or yachts. They spend it on improving or repairing their home.

1. Having worked in a financial institution for many years, I can tell you that this is not even close to universally true. It’s very common to use it as a debt consolidation strategy.
2. Even assuming this is always true, you’re essentially saying that they use the money from the loan against which their house is collateral, to do things that increase the value of the house. But borrowing using your shares in a company as collateral, in order to invest into that same company to increase its value, is essentially an identical ‘strategy’. You’re just arbitrarily deciding it’s bad for one illiquid asset to be used as collateral, but not another, even if the goal (increasing the value of the thing used as collateral) is identical.

Correcting a false statement isn’t bootlicking. Use your brain.

He could have given each of these employees a million dollars

1. The $2.9 billion is not money, it’s the number on a price tag.
2. Amazon lost over $200 billion in net worth in one day on 2022. Should employees be paying Amazon to work, when that happens, then? That’s only fair; anyone who financially benefits from a net worth figure rising, should experience equivalent financial detriment when the same net worth figure falls. Wanting only the upside is like demanding that your roulette wheel bet should pay out normally if you win big, but should be refunded when you lose.

What needs to happen is the loans that banks give them against their non-liquid assets should be taxed as income.

But loans aren’t income. You have to pay them back.

Pretending a loan is income and in turn taxing it as such, just because the ‘wrong thing’ was used as collateral, is nonsensically-arbitrary, I think.

P.S. Home equity loans are also ‘loans against non-liquid assets’.

if the top 1% paid a fractionof the taxes they used to.

Could you give an example of a year in which the top 1% paid enough taxes to satisfy this condition?