Writing in the WSJ today, economist David Malpass argues that fear of increasing taxes on investments in the US is one reason why people are fleeing from the dollar into other currencies or commodities. Read his article here.
We could draw a historical parallel. Robert Higgs contends that a strong reason why the US economy didn’t pull out of the Depression was “regime uncertainty” — that is, investors were wary of putting their money at risk because FDR’s administration was so unpredictable but generally hostile to profitable business. What with the looming possibility of a hard-core leftist in the White House working with a Democratic Congress, it seems that we are back to “regime uncertainty.”
