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- Jim Millstein, co-chair of Guggenheim Securities, said Monday that the "investor class" that benefited from President Donald Trump's tax cut in 2017 is likely to pay much of the government's coronavirus stimulus.
- The government deficit is expected to quadruple to $ 3.8 trillion in 2020, according to a federal guard. Wealthy Americans face "inevitable" tax hikes to cover much of the debt, Millstein said in an interview Bloomberg TV.
- "The era of tax cuts is over," he said, adding that the Fed's retention of risk assets should be paid for by those who benefited.
- You can find more stories on the Business Insider homepage.
Those who benefited from President Donald Trump's tax cut in 2017 will be the first to pay higher fees for the government's exploding debt, said Jim Millstein, co-chair of Guggenheim Securities, on Monday.
The government and the Federal Reserve are spending trillions of dollars to protect the economy from a pandemic collapse. The responsible federal budget committee expects the government deficit Balloon to $ 3.8 trillion from $ 984 billion in 2020 to a debt-to-GDP ratio similar to that of World War II.
While some spending cuts could support government money, Americans with "substantial incomes must make a larger contribution," Millstein said in an interview Bloomberg TV.
"There is a clear implication: the era of tax cuts is over," he said. "On the other hand, there will be corporation and income tax increases just to make the budget a little more balanced."
Millstein is no stranger to what comes after a recession and high aid spending. The co-chair led the Ministry of Finance's restructuring practices after the financial crisis, and Guggenheim is already working with travel agents affected by the Corona Virus toll.
It is "inevitable" that wealthier Americans will pay a large part of the bill because the Federal Reserve's policies have already supported much of the assets they deal with, Millstein said. The central bank's expansion in corporate bond purchases directly supported the credit market and indirectly raised stocks until April.
"This type of support for the investor class ultimately has to pay the investor class," said Millstein. "After all, if we really set a credit loss setback, you know that if this government does so much for this class, that class will have to start paying for it."
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