Nobodys talking why this tax has come up big now. Its because mkts worldwide are up 70-100%.If this tax passes its wallstreets greed that got them.If the mkts had gone sideways off 7k or so this tax wouldn't have a chance as so may people would have big loses no congressman would have the guts to push it. Better pray the mkt crashes 30% soon or 90% of the people on this board will be looking for work. Theres not a hard core trader on this board doing even 100k shares a day that can overcome a .25% tax.
1/4% Tax on all stock trades pushed in NY Times today
- Thread starter seasideheights
- Start date
Blog comment typifies too much thinking on this
I posted the Las Vegas newspaper editorial on my blog and got this response--
http://www.kendallharmon.net/t19/index.php/t19/article/26735/#401243
Such a tax would deter speculators who produce nothing of social value. With such a tax in place years ago, we would not have the current mess.
Speculators often make transactions within a day - not to produce goods to consume, or even sell to a broad market - but simply to make money. Itâs a bet rather than an investment.
It would help reduce the deficit (where are the deficit hawks when you need them?), and alter socially and economically damaging behavior.
Long-term investors wonât be hurt by modern versions of the Tobin Tax. Who will be hurt? people who are seduced by the idea of quick profits, without work. Greedy people.
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Alas I think this typifies so much of the poor thinking that is out there.
I posted the Las Vegas newspaper editorial on my blog and got this response--
http://www.kendallharmon.net/t19/index.php/t19/article/26735/#401243
Such a tax would deter speculators who produce nothing of social value. With such a tax in place years ago, we would not have the current mess.
Speculators often make transactions within a day - not to produce goods to consume, or even sell to a broad market - but simply to make money. Itâs a bet rather than an investment.
It would help reduce the deficit (where are the deficit hawks when you need them?), and alter socially and economically damaging behavior.
Long-term investors wonât be hurt by modern versions of the Tobin Tax. Who will be hurt? people who are seduced by the idea of quick profits, without work. Greedy people.
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Alas I think this typifies so much of the poor thinking that is out there.
So why not apply the tobin tax exclusively to the speculators and leave long-term investors out of it? The problem is they can't do it. They can't tell them apart. They have to tax everybody because everybody is investor and speculator at the same time. If investor is losing money by holding stock over many years he is a speculator. On the other hand if a speculator is making money over long period of time consistently it means that he is doing something right that does not contradict the nature of the market. If his average holding period is one month but he is making consistent profits for many years who is going to call him a speculator if he can survive in the market long enough? At least market agrees with his strategy. He is an investor from Mr.MARKET perspective.
Investment is also a bet.
As for the social value of the short-term investors they provide liquidity to those who buy IPOs.
Are you high or just mentally handicapped? I never implied such a thing. Apparently my comment about lawmakers is too hard to understand. No wonder so many laws obviously meant to screw the public get through while Joe Shmoe keeps yapping about how those damn Congressmen are so stupid.
The argument for providing liquidity is useless. It goes right over the head of the non-trading public.
Anytime a trader sees or hears a comment that trading is a "non-productive activity", they need to respond forcefully with something similar to the following:
OUR ACTIVITIES ARE ABSOLUTELY NOT "NON-PRODUCTIVE".
AS PRIVATE TRADERS WE GENERATE FEES THAT SUPPORT HUNDREDS OF COMPANIES AND THOUSANDS OF SOLID MIDDLE CLASS JOBS THROUGHOUT THE COUNTRY.
WE SUPPORT NEWS SERVICES, INTERNET SERVICE PROVIDERS, BROKERS, DATA PROVIDERS, WEBSITES, SOFTWARE DEVELOPERS, AND A HOST OF OTHER SMALL AND MEDIUM SIZED COMPANIES.
EACH OF THESE COMPANIES IN TURN PROVIDES INCOME TO OTHER COMPANIES THAT ASSIST IN SUPPORTING THEM, AND TO THE STATE AND FEDERAL GOVERNMENT IN THE FORM OF TAXES.
THE FINANCIAL INDUSTRY THAT WE AS TRADERS SUPPORT IS NOT WALL STREET. IT IS THROUGHOUT THE NATION, AND THAT IS WHERE THE IMPACT OF ANY TRANSACTION TAX ON INDIVDUALS WILL MOST BE FELT.
Then maybe you need to look through the history of laws & regulations aimed at the traders over the last 10 years and look at who benefited & who lost versus what the official statements were.
It's common sense. But in case it is not, since you may not be as knowledgeable as you think, let me explain something to you. Whenever a law that affects financial situations is proposed, studies and research is always conducted. If the intent of a trader tax is to raise tax revenue & penalize Wall Street, then this law would not even make it out of the brainstorming session.
Of course this law will not raise additional net tax revenue. Obviously there will be added unemployment, decreased liquidity (although not that bad), more costs passed down to the investing public and those with pensions. It's so damn obvious that the fact that this issue is getting so much attention and pull should make you wonder on whether those are the intended effects. Or you can just complain about how stupid Congress is and how they have no clue. Your choice.
Ever heard of... manners?
But I should have been warned. Over 1500 posts in less than a year. Oh well...
No wonder almost all interesting and/or successful people have already left ET or keep far away from it.
realmoney debate still going
http://www.thestreet.com/p/dps/cc/columnistconversation1.html
Timothy Collins
Back to Jim
11/27/2009 5:34 PM EST
I wasn't a contributor then with that tax issue.
However, my post wasn't about right or wrong, it is that "perception is reality." We spent weeks on end debating the leveraged ETFs, and what their place was in trading. Your argument then was to protect the individual trader. Your stance on reinstating the uptick rule was also to protect the individual trader and the markets. What's my point? If you champion yourself as the defender of the individual trader, then it has to be on all the issues that impact them, not some.
Also, please try not to take this the wrong way, but you are probably the only person on this board or reading this site that does trade only for charity. When I write, you write, Rev writes, etc, we are speaking to an audience, and I also strive to keep that audience in mind. What do they want from me? If I were them, what would they want from me? It is admirable that you give to charity. I should give more. I dare not take that from you. However, the point comes back to my last post. Why are you getting upsetting mail and posts? Because your charity is not going to the readers. Because the tax takes directly from every trader's pockets, whether it is a profitable trade or a losing trade. Because it is threatening the livelihood of individuals who rely on trading for income.
My post is NOT an attack. It is an explanation. You have been asking for the "why" of the reactions, and I have provided that explanation. Don't shoot the messenger.
http://www.thestreet.com/p/dps/cc/columnistconversation1.html
Timothy Collins
Back to Jim
11/27/2009 5:34 PM EST
I wasn't a contributor then with that tax issue.
However, my post wasn't about right or wrong, it is that "perception is reality." We spent weeks on end debating the leveraged ETFs, and what their place was in trading. Your argument then was to protect the individual trader. Your stance on reinstating the uptick rule was also to protect the individual trader and the markets. What's my point? If you champion yourself as the defender of the individual trader, then it has to be on all the issues that impact them, not some.
Also, please try not to take this the wrong way, but you are probably the only person on this board or reading this site that does trade only for charity. When I write, you write, Rev writes, etc, we are speaking to an audience, and I also strive to keep that audience in mind. What do they want from me? If I were them, what would they want from me? It is admirable that you give to charity. I should give more. I dare not take that from you. However, the point comes back to my last post. Why are you getting upsetting mail and posts? Because your charity is not going to the readers. Because the tax takes directly from every trader's pockets, whether it is a profitable trade or a losing trade. Because it is threatening the livelihood of individuals who rely on trading for income.
My post is NOT an attack. It is an explanation. You have been asking for the "why" of the reactions, and I have provided that explanation. Don't shoot the messenger.
Even if your conspiracy theory were true, I don't think it succeeds because there's enough money elite in aggregate now associated with retail trading to counterbalance whtever GS MS are conjuring up. And I don't think they are in their upswing. Probably the opposite. And to think that the govt itself has more sinister intentions is probably giving Defazio/Perlmutter and their ilk too much credit. They were indeed stupid and clueless enough to have actually tried it elsewhere sans conspiratorial intentions. Lawmakers here are not that much smarter.
I want to chime in now on the thread theme of the likelihood of the passage of this Defazio Bill. I see two equal and opposite errors. One is the Alan Farley (and many others) it will never happen mantra, and the other is the cynical one where is it almost or actually inevitable.
Both are wrong.
Someone wrote the following on my blog (his name is Chris):
"Please Kendall, letâs put this one to rest. Not even Chuck Schumer thinks itâs a good idea so I canât see this getting any traction in the Senate and maybe not even in the House either. "
Here is my response:
"Chris in #4, I would love to, and you are certainly right about Schumer. The difficulty is this has gone from being on the very fringes to slightly inside the outer edge. If you know anything about history and legislation, this is how these things get started. And when they do there are a whole lot of people that underestimate the significance of the movement thatâs taking place.
This is a bad idea. Right now, it stands little chance. HOWEVER, it is easily possible to see the pieces aligning on the chess board in such a way that it soon begins to have much more of a chance. This is especially the case because of a wave of populism and faux-populism in the country which is understandable but at the same time potentially dangerous unless properly channeled.
What is needed, therefore, is vigilance and pro-activity. And it is needed now."
http://www.kendallharmon.net/t19/index.php/t19/article/26735/#comments
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I would say the chances of passage now are maybe 10-20% but if you do not think that can change and fast you are kidding yourselves.
EVERYONE on this thread needs to read david ignatius's piece from tomorrow's washington post:
http://www.washingtonpost.com/wp-dy.../11/27/AR2009112702323.html?hpid=opinionsbox1
I especially highlight these two sections--
If the Fed's projections are right, the public is going to be very angry next year -- at big business and at the elected officials who have spent trillions of dollars without putting the country fully back to work. Lou Dobbs, the voice of populist anger, may become the nation's hottest politician. President Obama, who has struggled to find a centrist consensus for economic policies, may be tossed like a cork on a stormy sea....
The politics of rage aren't pretty. But in this case, it's hard to argue that the anger isn't justified. The Fed's analysis shows what we see in the daily stock market summaries. People on the top are recovering their losses; people on the bottom are out of work and out of luck.
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Please read all the above links and stay vigilant and alert--Kendall
Both are wrong.
Someone wrote the following on my blog (his name is Chris):
"Please Kendall, letâs put this one to rest. Not even Chuck Schumer thinks itâs a good idea so I canât see this getting any traction in the Senate and maybe not even in the House either. "
Here is my response:
"Chris in #4, I would love to, and you are certainly right about Schumer. The difficulty is this has gone from being on the very fringes to slightly inside the outer edge. If you know anything about history and legislation, this is how these things get started. And when they do there are a whole lot of people that underestimate the significance of the movement thatâs taking place.
This is a bad idea. Right now, it stands little chance. HOWEVER, it is easily possible to see the pieces aligning on the chess board in such a way that it soon begins to have much more of a chance. This is especially the case because of a wave of populism and faux-populism in the country which is understandable but at the same time potentially dangerous unless properly channeled.
What is needed, therefore, is vigilance and pro-activity. And it is needed now."
http://www.kendallharmon.net/t19/index.php/t19/article/26735/#comments
---------------
I would say the chances of passage now are maybe 10-20% but if you do not think that can change and fast you are kidding yourselves.
EVERYONE on this thread needs to read david ignatius's piece from tomorrow's washington post:
http://www.washingtonpost.com/wp-dy.../11/27/AR2009112702323.html?hpid=opinionsbox1
I especially highlight these two sections--
If the Fed's projections are right, the public is going to be very angry next year -- at big business and at the elected officials who have spent trillions of dollars without putting the country fully back to work. Lou Dobbs, the voice of populist anger, may become the nation's hottest politician. President Obama, who has struggled to find a centrist consensus for economic policies, may be tossed like a cork on a stormy sea....
The politics of rage aren't pretty. But in this case, it's hard to argue that the anger isn't justified. The Fed's analysis shows what we see in the daily stock market summaries. People on the top are recovering their losses; people on the bottom are out of work and out of luck.
-------------
Please read all the above links and stay vigilant and alert--Kendall