1/4% Tax on all stock trades pushed in NY Times today

Quote from ZeroSigma:unilateral adoption by Germany is unlikely
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Well, looks like the IMF's ample warnings went totally unheeded... and German politicians do want to repeat the Swedish experiment (unless derivatives will be exempt). At any rate, it is an obvious and great business opportunity! After all, the richest man in the City of London is the guy who started the UK's Stamp Duty Reserve Tax evasion industry with his nice OTC stock substitute called CFDs... And if derivatives are also covered, then I'm giving it three months - this time the government's learning curve would be much faster than in Sweden in the 80's - circumvention is now as easy as switching to the screen on the left:

'A financial transactions tax will be introduced.'
[source: 'Germany austerity deal calls for €80bn saving by 2014', Bild Zeitung, URL:
http://www.bild.de/BILD/news/bild-e...erity-deal-calls-for-80bn-saving-by-2014.html ]
 
Quote from ZeroSigma:

Well, looks like the IMF's ample warnings went totally unheeded... and German politicians do want to repeat the Swedish experiment (unless derivatives will be exempt). At any rate, it is an obvious and great business opportunity! After all, the richest man in the City of London is the guy who started the UK's Stamp Duty Reserve Tax evasion industry with his nice OTC stock substitute called CFDs... And if derivatives are also covered, then I'm giving it three months - this time the government's learning curve would be much faster than in Sweden in the 80's - circumvention is now as easy as switching to the screen on the left:

'A financial transactions tax will be introduced.'
[source: 'Germany austerity deal calls for €80bn saving by 2014', Bild Zeitung, URL:
http://www.bild.de/BILD/news/bild-e...erity-deal-calls-for-80bn-saving-by-2014.html ]
More...

Here's some more color on the German FTT:

http://www.ft.com/cms/s/0/0f9548c8-7256-11df-9f82-00144feabdc0.html

"She said Germany would fight for a Europe-wide financial transaction tax by 2012, and suggested that it would bring an extra €2bn a year to the German budget."

"The German thinking is to have a tax on all financial transactions, including computer trading and derivatives. The aim would be to include all high-speed transactions, rather than simply levy a tax on turnover. Although it is not expected to reach any agreement at the G20, Germany plans to push for an EU decision. If that is blocked, for example by the UK, Berlin will try for a eurozone transaction tax."

Now I guess we just need to hope that others arn't going to follow suite and that this turns out to be a disaster for Germany.

-Guru
 
Quote from ZeroSigma: unilateral adoption by Germany is unlikely
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Since derivatives seem to be also covered, then three months it is - single-broker coverage of multiple markets hasn't been banned yet, right? They really do need to read Wrobel's (1996) or phone Swedish minister of finance;)

Even time zones work to Europe's disadvantage: to participate in the main European trading hours, night-time trading from the US would be required (from 3 AM EST to 10 AM EST) which would be rather impractical, while many European funds are already well used to staying at work until 10:15 PM local (CET) time... much shorter commute time;) So attention US exchanges - please be ready to invite that German market with higher multipliers, retail e-mini versions, and not a single physical delivery in sight...;)
 
Quote from ZeroSigma:

Well, looks like the IMF's ample warnings went totally unheeded... and German politicians do want to repeat the Swedish experiment (unless derivatives will be exempt). At any rate, it is an obvious and great business opportunity! After all, the richest man in the City of London is the guy who started the UK's Stamp Duty Reserve Tax evasion industry with his nice OTC stock substitute called CFDs... And if derivatives are also covered, then I'm giving it three months - this time the government's learning curve would be much faster than in Sweden in the 80's - circumvention is now as easy as switching to the screen on the left:

'A financial transactions tax will be introduced.'
[source: 'Germany austerity deal calls for €80bn saving by 2014', Bild Zeitung, URL:
http://www.bild.de/BILD/news/bild-e...erity-deal-calls-for-80bn-saving-by-2014.html ]
More...

Worrisome....
 
Quote from achilles28:

Worrisome....
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I suppose it is a bit worrisome, but it's clear they have given up on a worldwide transaction tax and that's probably because they know it's unrealistic to pass this globally.
 
The German push for a FTT is conditional on eurozone adoption, not just in Germany. France will most likely say no FTT and delay bank taxes of any kind. That should hold off a FTT.

The UK already opted out of some Eurozone bailouts, so they are very unlikely to embrace the German rash-agenda, like banning naked short selling without getting EU-consensus first.

With meltdown 2.0 in the works, and some French banks probably in trouble - rumors of a huge Soc Gen derivatives loss last week and weaker capital ratios in EU banks versus US banks - it's doubtful the French will agree to tar and feather their banks with an industry-killing FTT. For sure, not if the UK, US, Canada and Switzerland won't pass a FTT too. The French will be more willing to deficit spend without pay go with new taxes._

The Germans are now locked into - and won't budge - from their pan-euro fiscal and monetary agenda. Others have talked and taken the lead and the outcome is unacceptable to the biggest economic force in the EU. It's going to be German-led austerity rather than Anglo-American Keynsian- deficit spending of printed money. The Germans won't dare chance worthless euros like 1930s marks.

As I have predicted for 6 months, the Germans want a euro-federal tax to pay for euro spending, including financial emergences. The French talk alot about the EU, but in the end care about their own industry and budget first. They don't want to pool a bank levy into a eurofund, again as the Germans prefer. In most cases, the French have said they prefer the UK approach to bank taxes.

A meltdown may forstall a FTT but it can also bring one on. High speed traders are inviting a FTT-grinding of their wheels. Public anger in meltdown 2.0 will be much greater and increase the odds of FTT. If France needs a bailout and German support they will most likely give in to the German agenda and say yes to a eurozone FTT.

Regime change won't dampen anger towards banks and BP oil. I am getting a little concerned again. Hopefully the euro bailout works, France holds in the euro distress and Germany calms down.

Sent from my iPhone
 
EU finance ministers seek Europeon bank tax:

http://www.reuters.com/article/idUSTRE6571RL20100608

"We have always said that a financial transaction tax can be introduced on a European level," Austrian Finance Minister Josef Proell said before talks in Luxembourg at which EU countries also discussed cuts to bloated public debts.

Luxembourg Finance Minister Luc Frieden said many questions remained unanswered on such a tax, which has been promoted by Berlin as a complementary charge to a bank levy.

"We need to discuss the goal of such a tax. Is the goal to make certain financial activity more difficult? Or to bring more money into state coffers? Or third, to bring money into a reserve fund for bank rescues?" Frieden said.

"Luxembourg believes a tax on high-risk bank transactions would be best, and that makes more sense if it is enacted globally."

On international opposition to a financial transaction tax:

"The G20 was a setback -… but it was not one for Europe. We still want this and will contribute to advocate it -… the sooner the better."


-Guru
 
Quote from listedguru: [some] EU finance ministers seek European bank tax .. Austria .. Luxembourg .. global
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why don't we restrict our outlook to countries whose capital markets have some international importance? And why do people have to make every mistake themselves...? Wouldn't it be cheaper to listen to the opinion of countries which have already tried taxing notional value, including for instance the Swedish derivative transactions tax experiment or the Irish attempt to remove the exemption for CFDs...?

Americans should be really proud of their democracy - at least in the US there was reasonable citizen participation (those petitions we signed and comments we wrote... did not go to waste), and reasonable transparency during the policy-making process (remember how Dean Baker was diagnosed with dyscalculia?;) and then the proper evidence-based policy option was chosen... I'm constantly reminded in various fields how excellent credentials Obama advisors have... and how quickly he got rid of the unions' trojan horse (Baker had a direct line to the White House, according to the BBC's American correspondent). Whereas here in Europe, the paymaster can choose any untested blue-sky policy she dreams up... Disregarding all objective advice: from the European Commission, the IMF, and from early adopters... Lucky the projected tax revenues in Germany are rather small, on par with the British ones - they may spare derivatives after all.
 
Quote from listedguru:

EU finance ministers seek Europeon bank tax:

http://www.reuters.com/article/idUSTRE6571RL20100608

"We have always said that a financial transaction tax can be introduced on a European level," Austrian Finance Minister Josef Proell said before talks in Luxembourg at which EU countries also discussed cuts to bloated public debts.

Luxembourg Finance Minister Luc Frieden said many questions remained unanswered on such a tax, which has been promoted by Berlin as a complementary charge to a bank levy.

"We need to discuss the goal of such a tax. Is the goal to make certain financial activity more difficult? Or to bring more money into state coffers? Or third, to bring money into a reserve fund for bank rescues?" Frieden said.

"Luxembourg believes a tax on high-risk bank transactions would be best, and that makes more sense if it is enacted globally."

On international opposition to a financial transaction tax:

"The G20 was a setback -… but it was not one for Europe. We still want this and will contribute to advocate it -… the sooner the better."


-Guru
More...




The G20 will continue to be a setback for them, which is why they will never see a financial transaction tax on a global level. So if they want to impose one on a European level, which I think is doubtful, go right ahead. In the end, they'll only be hurting themselves, and will help non - FTT countries like the U.S. and Canada.
 
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