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

[jbarnby]

Letter from my Tennessee Democratic Congressman:

"Thank you for taking the time to contact me in regards to H.R. 1068, the Let Wall Street Pay for Wall Street's Bailout Act. I am happy to respond.

As the economic crisis deepened over the course of the past few months, Americans have been calling for those responsible for our current situation to be held accountable. It is clear that Wall Street excesses have put Tennesseans in a very difficult position. With hundreds of billions of dollars being committed to stabilize the markets, taxpayers and members of Congress want to ensure that tax dollars are protected.

The legislation you mention would recover taxpayer dollars spent toward the TARP by temporarily charging the trading facilities a fee on securities transactions. I understand your concerns that H.R. 1068 may not be the best course of action to protect the taxpayers. I agree that now is not the time to impose a transaction fee. However, I did support the inclusion of a provision in the original TARP legislation called a "recoupment clause," which made clear congressional intent that the financial sector is ultimately responsible to recoup losses incurred by the taxpayer over time.

Thank you once again for contacting me. Feel free to write back with any future comments or concerns.

Sincerely,

Jim Cooper
Member of Congress"

 

[MrPowerBallad]

Quote from MrPowerBallad:

A bunch of pro-tax comments starting to congregate here:

http://www.businessinsider.com/trad...government-might-pass-transaction-tax-2009-12

Nice pontificating guys, but it looks like we may have lost this comments section to the pro-tax people.

http://www.businessinsider.com/trad...government-might-pass-transaction-tax-2009-12

 

[Midas]

Quote from jksn922:

I live approx. 30 minutes from the Canadian border, and have made some cursory checks in exploring the steps to becoming a Canadian citizen, should this idiotic tax eventually pass. I'm sure the asswipe politicians would put in strict language baring Americans from trading in other countries to avoid the tax. But they can't stop someone from becoming a legal citizen of another country that doesn't have a trader tax, therefore, they wouldn't be allowed to charge that person with the tax once they attain citizenship. Of course, all of this would be moot if a Tobin Tax is passed internationally. This is why the odds of this passing domestically is very low, and is stronger on an international scale.

Trading will just move to exchanges outside the US, there will be no need to become an expat. This is the problem that the dems keep running into. It is the very reason Pelosi, Barney Frank, and others have talked it down recently. The far left does not understand this fact and that is why it still keeps popping up.

 

[Anaconda]

Quote from faith4more:


Welcome back to the 80's when the markets were less efficient. Locked out the small guy and let only wall Street insiders make any money. This tax will accomplish the opposite of what those pushing it say it will.

Use your brain.

Who would gain significantly? The big Wall Street firms. Who would lose? Retail daytraders & investors.

Who lobbies hardcore and does major contributions to BOTH parties, but moreso Obama's? The same big Wall Street firms. Who has close to zero lobbying power? Retail daytraders & investors.

So put that in the pot & let it simmer, then try to figure out what this tax is really meant to accomplish, regardless of what the talking heads say. I mean really, you need your intelligence questioned if you actually listen to 99% of politicians' words instead of their actions.

 

[Luckystriker]

Quote from Anaconda:

Use your brain.

Who would gain significantly? The big Wall Street firms. Who would lose? Retail daytraders & investors.

Who lobbies hardcore and does major contributions to BOTH parties, but moreso Obama's? The same big Wall Street firms. Who has close to zero lobbying power? Retail daytraders & investors.

So put that in the pot & let it simmer, then try to figure out what this tax is really meant to accomplish, regardless of what the talking heads say. I mean really, you need your intelligence questioned if you actually listen to 99% of politicians' words instead of their actions.

But as we know money isn't created out of nothing (ok, sure not true for the FED , but strictly for trading). For every winning $ there has to be a losing $. So, when no loser trades with GS, what can GS win?

 

[Midas]

Quote from Anaconda:

Use your brain.

Who would gain significantly? The big Wall Street firms. Who would lose? Retail daytraders & investors.

Who lobbies hardcore and does major contributions to BOTH parties, but moreso Obama's? The same big Wall Street firms. Who has close to zero lobbying power? Retail daytraders & investors.

So put that in the pot & let it simmer, then try to figure out what this tax is really meant to accomplish, regardless of what the talking heads say. I mean really, you need your intelligence questioned if you actually listen to 99% of politicians' words instead of their actions.

Sorry big guy, the big wall street lobby is on our side in this case. They stand to lose more in lost tranactions business than they would gain making markets. Who do you think clears all of the transactions that take place? And the exchanges would be a net loser by far.

 

[JOSEF]

Quote from Anaconda:

Get it through your thick skulls. Market Makers would not be subject to such tax. The liquidity will still be there. The market making entities will have some fat profit margins to enjoy.

The market will simply resemble one that existed 2-3 decades ago, where 90%+ of the people could not trade on a short timeframe due to lack of technology and high commissions.

Please stop acting like most of the armies of daytraders & HFT hedge funds would be missed the slightest bit if they were gone. Most of the volume nowdays noise. Seriously, think back to 1980s when the volumes were a fraction of what they are today. Trading was still quite active, with plenty of speculators to provide price discovery, along with mutual funds, pensions funds and small retail guys doing some swing trading & investing. Companies still went IPO.

If this tax actually went through without any exemptions, you will have much more serious issues to worry about.

Then why did Sweden's seven year attempt with transaction taxes fail? Volume moved to markets abroad...

 

[jksn922]

Quote from Midas:

Trading will just move to exchanges outside the US, there will be no need to become an expat. This is the problem that the dems keep running into. It is the very reason Pelosi, Barney Frank, and others have talked it down recently. The far left does not understand this fact and that is why it still keeps popping up.

Even if the exchanges were to move outside the U.S., the idiot lawmakers would still make you pay the tax if you are a U.S. citizen, no matter where you place your trades from. That's why obtaining actual, legal citizenship of a non-trader tax country like Canada would be important. But if the tax were imposed internationally, then there would be no place to run or hide.
If the U.S. were to pass this tax, I'll be one of the first to say bye bye to the shithole U.S.A.. This country is on a direct path to socialism, if we aren't already there.

 

[Midas]

Quote from jksn922:

Even if the exchanges were to move outside the U.S., the idiot lawmakers would still make you pay the tax if you are a U.S. citizen, no matter where you place your trades from. That's why obtaining actual, legal citizenship of a non-trader tax country like Canada would be important. But if the tax were imposed internationally, then there would be no place to run or hide.
If the U.S. were to pass this tax, I'll be one of the first to say bye bye to the shithole U.S.A.. This country is on a direct path to socialism, if we aren't already there.

Not so, when is the last time you paid sales tax to the US while traveling abroad? Or any tax other than on the income you make for that matter?

As for socialism, Canada is ahead of the US in the race to that end. New Zealand would be a better option for you in that respect.

BTW, you have more things to be ungrateful for in the US than most people in the world could dream of being grateful for.

Its not the country thats at fault its those who want to take it in the wrong direction.
Don't forget that.

 

[Anaconda]

Quote from Midas:

Sorry big guy, the big wall street lobby is on our side in this case.

Gee really? Is that why they are keeping quiet for over a year while this tax keeps gaining ground? Contrary to what most believe, the lobbyists are the ones who write the laws, not the congressmen.

They stand to lose more in lost tranactions business than they would gain making markets. Who do you think clears all of the transactions that take place? And the exchanges would be a net loser by far.

WRONG! Pension & mutual funds will still move their holdings around the same, with the few market makers being able to make great profit margins providing liquidity. HFT games will not be necessary when you don't have to deal with hundreds of daytraders churning shares & getting in the way. The exemption is an edge that is worth much more than expensive top of the line blackboxes. Think of how much easier would it be for a market maker to make much easier & bigger profits, hence decreased operational costs.
Clearing business is a LOW MARGIN business operation that has only been getting more competitive.

As for the exchanges, take a look at who owns them and has controlling stakes.

I don't know how many of you traded before this or last year, but anyone who went through the SOES phase, the NYOB stepping sizes phase and the NYSE bullets phase can, at the very least, make a comparison. When 50 guys doing that style, it's easy & great money. When you got hundreds of guys jumping in on it, all of the sudden it's competitive cutting out most of the previous profits.