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

[Anaconda]

Quote from gerry875:

then - according to you - this defazio clown is an instrument of evil wall street, right?

Why don't you look up who comprises most of his contributions and then we will know. I do know that Obama has gotten two to three more times the contributions than McCain from the key Wall Street firms. Which should make it clear to you that he is anything but anti-Wall Street. Which also explains his cabinet on economic & financial affairs, mostly Goldman Sachs cronies. I doubt the picture is significantly different for most of Congress.

Knowing who comprises Obama's cabinet and who is financing him, you would think that if Goldman, JPMorgan, Morgan Stanley would have had DeFazio shut up over a year ago when he started talking about this tax. Yet instead, it has only gained more attention & publicity.

Think about it.

 

[hardrightedge]

there is no populist rage. almost all the rage these days comes from the right. the left constituency, ie poor and unemployed, just bends over and takes it.

if there was a real populist rage, we would have seen it from the uninsured with the health care bill. They are missing in action. no one in their right minds really wants to punish wall street because they're all feeding on the teat, like we do.

 

[jj69]

Quote from tomdavis:

...And, to answer your question more directly, it's unlikely that Obama or Geithner would support a bill that could put tens of thousands of people in the unemployment lines. Everyone is pissed at Wall Street, but nobody wants to do anything to worsen the unemployment situation.

Execpt for Jim Cramer...what an ass he is.

 

[ksharmon]

Tyler Durden on zerohedge: Tobin Tax Opponents Are Ignoring The Real HFT-Induced Trading Toll; Why VWAP Is A Gold-Mine, But Not For You

With the debate over Tobin tax increasingly appearing on the front pages of the mainstream media, we thought we would revisit a theme discussed previously on Zero Hedge, namely the issue of whether or not the predominant trading paradigm, i.e., High Frequency Trading, offsets trading costs as proponents of this trading strategy claim. We had previously proposed some broad estimates in quantifying the cost of HFT [1]: our results received the stern condemnation of those whose livelihood is dependent on microsecond speculative scalping of pennies on the dollar, thousands if not millions of times a day, under the guise of "liquidity provisioning." It is precisely these people who are most opposed to a trading tax as it will make most HFT-based strategies prohibitively expensive. And while a final proposed version of what a tax might look like is still to be determined, it is only reasonable to expect that it is most punitive to those that do the opposite of allocating capital on a long-term basis, and thus most detrimental to those parties who merely churn stocks under the "noble" pretense of providing liquidity. Of course, that this liquidity is provided in the most liquid of names as is (and of course those above the $1 rebate-collection threshold [2]), is often ignored.

Furthermore, we have historically been very critical of VWAP algorithms, [3]pitched by the likes of Goldman Sachs in their REDI trading platform as the core trading strategy involving non-dark liquidity and trades in open exchanges (of course for those who prefer to be exposed to Goldman's much more principally lucrative proprietary bid/ask in a dark pool venue, Goldman has Sigma X for that).

A recent research report by Quantitative Services Group presents one of the first empirical studies confirming our hypothesis that in its most frequent incarnation, VWAP algorithms, HFT not only does not reduce trading costs, but in fact augments these

http://www.zerohedge.com/print/33616

It is long and there are a lot of graphs; note carefully that he envisages the possibility of a <i>variant that does not impact day trading enthusiasts</i>.

 

[zdreg]

Quote from Anaconda:

Why don't you look up who comprises most of his contributions and then we will know. I do know that Obama has gotten two to three more times the contributions than McCain from the key Wall Street firms. Which should make it clear to you that he is anything but anti-Wall Street. Which also explains his cabinet on economic & financial affairs, mostly Goldman Sachs cronies. I doubt the picture is significantly different for most of Congress.

Knowing who comprises Obama's cabinet and who is financing him, you would think that if Goldman, JPMorgan, Morgan Stanley would have had DeFazio shut up over a year ago when he started talking about this tax. Yet instead, it has only gained more attention & publicity.

Think about it.

goldman will be exempt from the tax while the ET retail traders will be hit with it.

 

[Sky123987]

just say this is able to pass the senate. Do we have a chance that Obama will veto the bill?

 

[Sky123987]

Quote from tomdavis:

I just spoke to a friend of mine who works in DC for a large lawfirm that does a lot of work for the financial industry. He thinks that this bill will fly though the House with little if any debate. The Senate, he says, is another matter. He told me that Schumer's opposition is largely posturing. Schumer is an expert at this. If he gets a big enough payoff for his state (i.e., votes for himself in the next election), he'll change his mind. Many of the other Democratic Senators will be influenced by the analysis that comes in from CBO and whatever testimony is given in the hearings before the vote. If the concensus is that this tax will create large-scale unemployment in the financial industry, it will die a quick death in the Senate because the all Republicans and several conservative Democrats will line up together making it impossible to get 60 votes. If the reports show that the effect on unemployment will be negligible (hard to believe, but who knows) then it may get through the Senate.

wow I am very surprised that this bill will fly through the house. Very surprised

 

[MrPowerBallad]

Quote from Sky123987:

wow I am very surprised that this bill will fly through the house. Very surprised

The timing will be tricky with this tax for the dems. Since we know the IMF is supposedly doing a study as to a feasibility of the tax and since people like Pelosi are interested in this being international, congress would have to wait until at least the IMF report is released -- currently slated for some time in late April. They simply can't ignore the IMF study. The problem is that the dems want to move on this bill as soon as health care is voted on, so late April is probably too late. Aside from the IMF study, there will have to be other studies since the logistics of implementing and collecting the tax aren't trivial.

 

[Stok]

What needs to be done is a feasibility study that proves how disastrous this would be and prove that it will be net revenue negative. CME, CBOT would almost shut down...I couldn't see how any futures market would exist. All online brokers would crash as well. And it would put not only active traders out of business...tons of hedge funds, CTA's etc would shut up shop. Heck, even doing 2-3 trades a month as a swing trader would might not be possible. Liquidity would dry up big time.

Saying that, I am getting nervous about this. A buddy of mine who runs a fund says what he hears is that this has no chance in passing....and if it did, he was moving offshore.

 

[jprad]

Quote from Stok:

Saying that, I am getting nervous about this. A buddy of mine who runs a fund says what he hears is that this has no chance in passing....and if it did, he was moving offshore.

Stop worrying and start listening to your buddy.

This thing ain't got a snowball's chance...