TAX DERIVATIVES AS GAMBLING RATHER THAN INVESTMENTS.

The financial markets today create products that are not investments in tangible businesses or property but are instead vehicles to allow people to bet whether some unrelated thing will or won't happen. These products that are not directly tied to a tangible investment do not help the economy, but they instead greatly contributed to the crashing of the economy in 2008. If the IRS treated these items as the gambling that they are, losses from derivatives would only be deductible against other gambling gains and derivative gains would be taxed as ordinary income rather than at the lower capital gains rate. This change would increase tax revenue and move investors to things that actually build businesses and create jobs.