Von der Leyen: €300 billion in European savings flown overseas every year, primarily to the US, will be invested in Europe from now on. All 27 EU states agreed to establish the S&I Union, a step toward the full Capital Market Union

[u/paneuropeanism_]

https://streamable.com/4h43qk

[u/Vast-Palpitation-426]

Yes I'm talking about the tax incentive system. It doesn't work. 

They need to actually do something to make investing in Europe attractive instead of just taxing people until the morale improves.

I think they should advertise the European market's relative stability and resilience to make the typical European, which is a very conservative person financially speaking to invest their savings into no brainer European funds.

Because if you want to optimize you will want diversification. But plenty of people wouldn't care for optimization and would just subscribe to an easy EU investment basket if it was consumer friendly and properly advertised.

[u/bozoconnors → u/Vast-Palpitation-426]

taxing people until the morale improves

lol - THE TAXING WILL CONTINUE UNTIL MORALE IMPROVES!!!

Yeah, as an American, this just seems like grandstanding for political points or something. If you want EU money to stay there, make it attractive? Hell, make it attractive to US citizens!? We've got 24 million millionaires looking to diversify internationally.

[u/Vast-Palpitation-426 → u/bozoconnors]

Well Europe is already attractive it's not black and white. During the last 5 years Stoxx Europe 600 did 10.7% annualized, and the S&P 500 12.8%. And developed Europe is already 15% of a world index (US 63%).

But capitalism being what it is, investors chase the best results, even if it's just 1%. And momentum and passive investing reinforces the inbalance. So regulations to keep capital home makes sense, but the Member States never work on fixing the European market's structure, or educating people on financial litteracy (huge deal. the amount of money sitting in saving accounts in Europe is crazy. €11.5T), all they do is hammering the middle class with constraints to just try coerce the few who decided to invest to stick to the mess they refuse to reorganize and promote.

But there are also factors we can't change. The US had a headstart and in this and will keep it.

[u/bozoconnors → u/Vast-Palpitation-426]

€11.5T

good lord. we could also use some standard financial literacy education here. it's totally absent. mine was via my dad and almost all self taught. pretty dumb for a country with millions of millionaires.

The US had a headstart and in this and will keep it.

I like your optimism, but we'll see. With our debt passing 40t, and no end to spending increases in sight... seemingly zero motivation for either party to at least slow it down... I don't think this is going to turn out well. For anybody on the planet. C'est la vie mon ami!

[u/FGN_SUHO → u/Vast-Palpitation-426]

The basic problem is that US companies can be much more profitable because the US is capitalism's final boss. A company like United Health or their predatory banks just couldn't exist in most European countries. That is a good thing for the record. But you can't have strong worker, tenants and consumer rights and ALSO insane shareholder yield. It just doesn't add up.

It's a good thing that the EU is removing barriers to entry, but the US is is over 60% of the world market, Europe is roughly 15%. That's a massive head start and with the above mentioned barriers to shareholder extortion it's hard for Europe to catch up.