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

Quote from Robert A. Green:

Thanks Tom and Southall. My fear is an exploding FTT bombshell. Am I right with my below comment just made on WSJ? Need to flush out the reach language again, and anew when we see the updated details.

UK Leader Cameron will Have Key Role in Talks.
http://online.wsj.com/article/SB10001424052970204319004577084572563859352.html

Green Comment:

The German-demanded EZ-wide financial-transaction tax (FTT) drops like a bomb on London. Many in the U.S don't realize it drops like a bomb on NYC and Chicago too, with American tax dollars being forked over to Germany's EZ. Why is Secretary Geithner not helping Cameron block this harmful tax? Geithner repeatedly said he and President Obama are against FTT and support a bank levy instead. If this FTT is allowed to snowball, starting in the EZ, it will lead to a worldwide market crash.

It's old news that Cameron will veto an EU-wide FTT. He's now trying to limit the reach of an EZ-wide FTT bombshell from still landing in London. EZ banks and companies executing transactions on London exchanges, or through UK intermediaries - at every stage of a transaction - will be subject to UK counter-parties charging, withholding, and paying this FTT over to the EZ in Brussels. The same goes for U.S. exchanges. Transactions may not flea, since the EZ reach will follow them. Transactions will dry up instead and markets will implode.

Hopefully, Cameron is negotiating to limit that FTT reach-rule language, so its less onerous on the UK. It's a similar problem with bank and fund regulations _getting more onerous from the EU too._
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"American tax dollars being forked over to..."

I'm a bit troubled by this construction -- not the substance, mind you, but its expression here. To my ear, anyway, it invites a riposte along the lines of, "Well, then, we must set up our own FTT so as to keep American tax dollars where they belong--in America!"

Which would be a nonsense argument, of course, but their talking points are already so Alice-in-Wonderland. In any event, one must be mindful of how one's words can be taken our of context, twisted beyond recognition, and thrown back in one's face.
 
Quote from tortoise:

"American tax dollars being forked over to..."

I'm a bit troubled by this construction -- not the substance, mind you, but its expression here. To my ear, anyway, it invites a riposte along the lines of, "Well, then, we must set up our own FTT so as to keep American tax dollars where they belong--in America!"

Which would be a nonsense argument, of course, but their talking points are already so Alice-in-Wonderland. In any event, one must be mindful of how one's words can be taken our of context, twisted beyond recognition, and thrown back in one's face.
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Thanks Tortoise. That's my point, some in Congress and the UK may perceive the EZ FTT as sucking money - taxes and spreads - out of the U.S. and UK, and have that justify a tax-arms race to combat it.

With global-reaching U.S. FATCA tax rules - Foreign Account Tax Compliance Act - the U.S. forced Swiss, EU and other banks to withhold U.S. taxes on American's offshore bank accounts, and then fork over the money to the U.S. This hurt EU and Swiss banking. These tax-attack wars are already well under way. Dodd-Frank also attacked foreign banks and forex brokers by limiting American's leverage and requiring those institutions to register in the U.S. It's a disturbing trend of arrogant extraterritorial reach.

I don't trust all our governments here. In the end, they like tax revenues to pay their bills.

It's late, so I will check out now. I am concerned, so I posted a lot. FTT gets very little alarm and readership in the media from my calculations. Most people still think its tiny and not a threat.
 
Quote from Robert A. Green:

Thanks Tortoise. That's my point, some in Congress and the UK may perceive the EZ FTT as sucking money - taxes and spreads - out of the U.S. and UK, and have that justify a tax-arms race to combat it.

With global-reaching U.S. FATCA tax rules - Foreign Account Tax Compliance Act - the U.S. forced Swiss, EU and other banks to withhold U.S. taxes on American's offshore bank accounts, and then fork over the money to the U.S. This hurt EU and Swiss banking. These tax-attack wars are already well under way. Dodd-Frank also attacked foreign banks and forex brokers by limiting American's leverage and requiring those institutions to register in the U.S. It's a disturbing trend of arrogant extraterritorial reach.

I don't trust all our governments here. In the end, they like tax revenues to pay their bills.

It's late, so I will check out now. I am concerned, so I posted a lot. FTT gets very little alarm and readership in the media from my calculations. Most people still think its tiny and not a threat.
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Fair enough. Honestly, I'm so rattled by the NYT piece, I'm finding it hard to think straight about this right now. Not to beat a dead horse, but that article was staggeringly unprofessional, so far outside the norm of Times standards I hardly know where to begin. Everything about it -- the copy, the headline, the front-and-center placement on NYTimes.com, the "selected" comments -- smacked of undisguised agitprop. I just don't get it.

Say what you will about the Times' alleged political biases. They are, in general, kept in check; that's why the Times is The Times. This article was, to my read, utterly foreign to the Times ecosystem. How the hell did that get in the paper? Who reviewed it? Approved it? Why?

What's going on here? How is it that nurses and public employee unions have closed ranks around the idea of "taxing banks" by championing a tax that actually doesn't tax banks? Why has an arcane, flimsy, and arguably useless tax concept become the rallying standard for a social justice movement sweeping the West?

It's weird, Mr. Green. You're doing a phenomenal job, batting back the misinformation and nonsense. It's a marvel to behold.

I just wonder whether there's more than misinformation and nonsense at work here.

And I just wish I knew what it was.
 
Thanks Tortoise, I really appreciate your nice comments.

I was surprised at the NYT article too, but I saw it on CNBC's site followed immediately with a hard-hitting anti-FTT piece, so I was less upset than you.

I can complain to Andrew Ross Sorkin, Louise Story, Gretchen Morgenson and a few other top business writers at the NYTs that I trade emails with. So, please send me an email on this, intended for them, and I will forward it with my note too, with cc to you.

Why should the NYT's back OWS against the interests of their home city? Remember, it was Bob Herbert's article in the NYTs that touched off our thread in the first place. He is no longer with the NYT.

We need to hold the media's feet to the fire on FTT.
 
Quote from Robert A. Green:

Thanks Tortoise, I really appreciate your nice comments.

I was surprised at the NYT article too, but I saw it on CNBC's site followed immediately with a hard-hitting anti-FTT piece, so I was less upset than you.

I can complain to Andrew Ross Sorkin, Louise Story, Gretchen Morgenson and a few other top business writers at the NYTs that I trade emails with. So, please send me an email on this, intended for them, and I will forward it with my note too, with cc to you.

Why should the NYT's back OWS against the interests of their home city? Remember, it was Bob Herbert's article in the NYTs that touched off our thread in the first place. He is no longer with the NYT.

We need to hold the media's feet to the fire on FTT.
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I'll send you an email first thing tomorrow
 
Quote from Robert A. Green:


I can complain to Andrew Ross Sorkin, Louise Story, Gretchen Morgenson and a few other top business writers at the NYTs that I trade emails with. So, please send me an email on this, intended for them, and I will forward it with my note too, with cc to you.
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Be careful.

Putting the FTT topic in front of the minds of Sorkin, Story, & Morgenson can have unintended consequences for us.

Remember, the goal is to get the volume of this tax down to zero, not to have them write about it more.
 
http://www.businessweek.com/ap/financialnews/D9RFO09G0.htm


UK's Cameron defends London's financial industry

British Prime Minister David Cameron says he will demand greater freedoms for London's sprawling financial industry as his price for supporting any new European Union treaty to solve the euro crisis.

Britain's banks are particularly concerned that some EU countries are advocating a tax on every financial transaction, the so-called "Robin Hood tax." Cameron's government has been emphatic in rejecting this concept.

"(This) is in the interest of the entire country and something I will be fighting for on Friday," he said.
 
Slovenia against EZ FTT, for global FTT :

http://www.sta.si/en/vest.php?s=a&id=1704034

Govt Arguing for Financial Transaction Tax on Global Level

Ljubljana, 8 December (STA) - The government adopted on Thursday Slovenia's position on the draft EU directive on a common system for a financial transaction tax that would take effect in 2014 and raise about EUR 57bn a year.[...]

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‎The above article requires subscription to read the rest of the article, but google news search results tell us about their position on EZ FTT anyway......

STA - Slovenska Tiskovna Agencija (subscription) - 13 minutes ago
Introducing the financial transactions tax only in the eurozone is meanwhile unacceptable for Slovenia, the government said, arguing that the ...
 
Very good info from the UK's European Scrutiny Committee
http://www.publications.parliament.uk/pa/cm201012/cmselect/cmeuleg/428-xxxix/42806.htm

Among more technical points, below is something the general public should know: for every 0.1% increase in the EU FTT rate, half million EU people lose their jobs. Some want a rate of one percent, two percent, the president of, I think it was, the Dominican Republic, demanded 5 percent, in part to be directed to corrupt regimes.

-with a tax rate of 0.1% the model finds that EU GDP drops 1.76% in the long-run, with an accompanying drop in employment of 0.2%;
-a tax rate of 0.2%, as implied by the Commission's explanatory memorandum, leads to a 3.43% long-run drop in EU GDP and 0.34% drop in employment;
-these effects stem from the increase in business's cost of capital caused by the tax;
-the assessment points out that the significant economic impact of the tax derives from the cascading effect of the tax, whereby transactions in the same production chain are taxed several times; and
-taking these figures in turn and before taking into account relocation effects, in real economic impacts it can be estimated that a reduction of 1.76% of EU GDP equates to a fall in economic output of €216 (£186) billion, a fall in employment of 0.2% equates to a loss of 478,000 jobs, a 3.43 % fall in EU GDP equates to a fall in economic output worth €421 (£362) billion and a 0.34% fall in employment equates to a loss of 812,000 jobs.
-the tax would not just affect banks and bankers, but also increase costs for consumers through this tax being paid by insurers, asset managers, pension funds, industry including manufacturing and the broader service sector;
-the stamp duty differs from the EU proposal in that the UK's carefully targeted stamp tax on shares (STS) is fundamentally different from the Commission's all-encompassing and poorly designed FTT;
 
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