“ they are granted almost unlimited credit to cover any purchase.”
This is where I feel tax policy should step in, if it hasn’t already. I get that unrealized or non liquid wealth is theoretical based on valuation. But as soon as it’s used as collateral there’s an income aspect that should be taxed. Basically, once you start using that wealth to secure loans, it’s not really “unrealized” anymore and should be taxed.
Might not be a bad idea, anything beyond a single HELOC gets taxed 25% off the top, or something else that someone smarter about economics than I would certainly be able to come up with.
This is where I feel tax policy should step in, if it hasn’t already. I get that unrealized or non liquid wealth is theoretical based on valuation. But as soon as it’s used as collateral there’s an income aspect that should be taxed. Basically, once you start using that wealth to secure loans, it’s not really “unrealized” anymore and should be taxed.
Might not be a bad idea, anything beyond a single HELOC gets taxed 25% off the top, or something else that someone smarter about economics than I would certainly be able to come up with.