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american billionaire and hedge fund manager john paulson has said that if democratic presidential candidate harris implements her proposed tax plan, financial markets will collapse and the economy will fall into recession.

paulson, 68, entered the hedge fund industry in the 1990s. he shorted about $25 billion in mortgage securities during the subprime mortgage crisis and earned a huge profit of $15 billion for his clients. he is known as the "short god of wall street" and the "no. 1 in hedge funds."

paulson is now a "super donor" to republican presidential candidate trump. earlier this year, sources revealed that if trump wins this year's election, he will recruit paulson to be the treasury secretary.

in an interview with the media on friday (september 13th) local time, paulson said that the democrats want to raise the corporate tax rate from 21% to 28%, raise the capital gains tax from 20% to 39%, and impose a 25% tax on unrealized capital gains.“if these policies were implemented, there would be no doubt that the market would collapse.”

it should be pointed out that the "39% capital gains tax" mentioned by paulson is the 39.6% tax rate proposed by biden in the fiscal year 2025 budget. harris' proposal is to impose a 28% long-term capital gains tax on households with an annual income of $1 million or more, which is a compromise tax rate.

paulsen explained that if the specific plan to tax unrealized gains is implemented, the economy could quickly fall into a recession, “if the biden-harris team comes to power and implements the policies they have prepared, it will lead to a massive sell-off of homes, stocks, companies, and art, which could put us in a recession immediately.”

paulson predicts that even if harris is elected, the new government will not continue to do so. it is worth mentioning that people close to harris' campaign team also said that harris has no intention of taxing unrealized gains, and it is doubtful whether such a plan can be passed by congress.

speaking of trump's tax plan, paulson believes that if the tariffs are implemented with the right targets, they will not lead to inflation. he also said that lower corporate and capital tax rates will stimulate economic growth, help increase tax revenue and narrow the deficit gap.

during his first term, trump also advocated "trickle-down economics" - allowing the government to cut taxes on businesses and the wealthy to encourage investment, promote economic development, and thereby increase the government's total tax revenue.