StevenP

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Same problem in China really - young people can't decide if they should work hard and end up having to be able to afford nothing or to speculate and hope that it works. So the presitgious Peking University student asked Premier Wen whether he should aim for the star and the Premier replied that you should put your foot firmly on the ground. http://translate.google.com/translate?hl=en&sl=zh-CN&tl=en&u=http%3A%2F%2Fwww.zaobao.com%2Fspecial%2Fchina%2Fzaodian%2Fpages2%2Fzaodian_zi100626.shtml Original link: (use google translate to read if the above link doesn't work) http://www.z

I think 28% is a fair rate (18% probably too low) and remember that there is no taper, so a good chunk of the gain could be inflation and after CGT rate return adjusted for inflation could well be negative. 40%, 50% etc taxes are far too high anyway and perhaps we should aim to have noone having to pay more than 33% of their income (so 1/3 for the society, 1/3 for self and family and 1/3 for the future).

The Austria school of economic will say that there is a demand if the price is right and there is no paradox of thrift - just the wrong price. For example, people will buy the house/build that extension if the price is deemed to be cheap and will not do it if it is deemed to be expensive (although some do it of course if they think the money they have just spend will go round and bid the house price up ever more....). There is some truth to the paradox of thrift theory, but not the whole truth,

In 1899, Commissioner of the U.S. Office of Patents said "Everything that can be invented has been invented". There are plenty of alternative now and more will come when the commercial conditions are right. Oil is so popular, contrary to what most believe, is that it is incredibly cheap compared to the alternative. If we have to go for electric car that cost 2x more per mile, it is end of the world? Don't think so. (Of course with smart grid, it may turn out to be a energy saver and the electric generation can come from nuclear power).