Between 1996 and 2000 the VCs clobbered Buffett. Any good VC firm in Menlo Park, Cambridge or New York doubled its money every 12 months. If history is a guide, the number will fall by half. Then came the 1986 tax bill. This, of course, killed the technology stock market when it took effect between 1988 and 1990.
Money is pretty darn rational.
It does a fine job of looking after its own hide. It is especially sharp-eyed when it comes to taxes. Just because taxes on capital gains and income are at the same rate in the tax code doesn't mean they produce, in fact, the same result. Income is taxed immediately. Capital gains are taxed over a holding period at the point of sale.