If Democrats raise taxes on investments, ...

From Real Clear Markets

The higher the taxes on investment returns, the higher the rate of return investors will require for their investments and the less they will pay for a given investment. A natural extension of this concept is that if the tax rate on investment returns increases, the value of those investments in the economy will decrease. In the context of the stock market, moving from lower investment tax rates to higher investment tax rates will lead to a drop in market values, all other things equal.

Equity Discount Rate:

Candidate	Investment Tax Rates	Base Rate	Risk Premium	Tax Premium	Equity Discount Rate
A (Rep.)	15%	4%	0	0.7%	4.7%
B (Dem.)	35%	4%	0	2.2%	6.2%

[A Democratic proposal] to increase in investor tax rates will increase the equity discount rate by more than 30%. To put this into perspective, let us value a hypothetical company that is expected to generate $100 a year of cash flow into perpetuity. Under these circumstances, the values of this company under the policies of Republican and Democrat Candidates are $2127 and $1613, respectively. (Please note that these calculations did not require a premium for inflation or risk. Incorporating these factors into the discount rate, only serves to increase the final return demanded by investors and further reduce market values and economic growth.)