Tax expectations may speed stock sales
USA TODAY, April, 2008 by Adam Shell
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NEW YORK -- The tax man, in search of revenue, cometh to Wall Street.
With investors expecting the U.S. government to take a bigger chunk of stock-related profits no matter who wins the White House in November, the investment mantra, "buy low, sell high" may soon give way to "buy low and sell before taxes on capital gains and dividends rise."
That potential urge to sell before tax rates go up could act as a fresh headwind for stocks, which are already struggling under the weight of a slowing economy, depressed housing market and upheaval in credit markets.
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"The deck appears to be stacked against investors on the tax front," notes Dan Clifton, head of policy research at Strategas Research Partners. Higher taxes on investments, he says, could result in lower stock prices and less demand for stocks as folks seek out more tax-friendly assets, such as municipal bonds. ...
