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Rich Uncle sits you down one day and says: Have I got a deal for you! Look, he says, I own 500 shares of stock

Rich Uncle sits you down one day and says: "Have I got a deal for you!"

"Look," he says, "I own 500 shares of stock in Startup, Inc. I'm ready to cash out and retire to Bimini, so I'll sell it to you for the very same $200,000 I paid for it back in 2014. And, by the way, it's qualified small business stock, so you're completely protected! Even if the company went under, you'd get 100% "ordinary" tax cushion for the loss! What do you say...???"

Identify the two glaring problems with the "deal" that Rich Uncle is offering you.

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