Two words for the future: financial services

From the international-news-that-could-very-well-be-pertinent-to-your-financial-future department, Sweden has announced that it plans to abolish its decades-old wealth tax.

Does that sound moot? At first glance, perhaps. After all, Sweden is far away, and Swedish tax policy is not directly relevant to U.S. taxpayers.

However, a more critical look reveals that Sweden's move underscores an ongoing global trend toward privatization, markets and investment, and away from policies that restrict capital inflows, investment, and, more generally, commerce.

U.S. readers are familiar with investment conditions stateside in the last two decades, during which federal income taxes have been reduced and the nation has pursued a more business-friendly regulatory policy.

But what some readers may not be readily aware of is that the lower-tax/encourage-commerce trend has also been a feature of economic policy in Europe and Asia. To be sure, Europe's income-tax rates, in general, remain higher than those in the U.S., and many states in those regions have more-extensive social welfare states than the U.S., but the move toward investment, commerce and markets is clear, and Sweden's wealth-tax abolishment is further evidence.