>>OTOH, various swaps, options, futures and other papers with funny names aren't exactly taxed each time they change hands, but only periodically, when decided which of the earnings are long and which short term investments.
>
>The gain (or loss) is taxable each time a trade occurs.
>The tax rate depends on several factors, one being the length time elapsed between purchase and sale.
>
>It's not completely true that in the US something is taxed each time it changes hands.
>If I consistently buy widget x with the intent of reselling it I can get a certificate exempting me from paying sales tax on that widget, but the person buying it from me will pay tax on the selling price, so one step will be skipped in that instance.
My profit or loss with be taxable.