Originally Posted by dabateman

Sure... I'd be more than happy to. A national sales tax will suppress sales. Individuals will avoid purchasing products for a period of time after the implementation of the national sales tax. While the "real" price may not have changed, the sticker price will have jumped substantially. Individuals will look at the prices and lose confidence in the amount of money they can spend. This will reduce sales. Reduced sales will limit the effectiveness of the national sales tax to generate money and will lead to a deterioration of the companies sales. A drop in sales will lead to a drop in the value of stock. A drop in the value of stock will reduce the incentive for the investor to invest.

The economy will cool and if the situation is prolonged it could cause it to freeze. Another "Great Depression" style economic situation is a great possibility.