Thanks for posting this. Glad to see some folks against this horrible tax... I like how the CEO of the London Stock Exchange says the tobin tax is essentially a tax on jobs....
-Guru
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1/4% Tax on all stock trades pushed in NY Times today
- Thread starter seasideheights
- Start date
Thanks for posting this. Glad to see some folks against this horrible tax... I like how the CEO of the London Stock Exchange says the tobin tax is essentially a tax on jobs....
-Guru
Quote from rsikit:
I thought I saw it say in the morning but I will try and find when they have it scheduled, they keep talking about it on cnbc, but I usually tune them out. Will let you know when I find out
Okay, thanks. Hopefully, he comes out and continues to bash this tax. Maybe his words can help simmer this thing down a little.
Quote from loufah:
The daytrading business will be injured. But discount brokers like Schwab will survive. My first stock purchase was $5K worth of SUNW in 1987. From Schwab. The commission was around 2%. I held onto it through 5 splits. I'm not sure non-daytraders are buying GOOG right now, but suppose a mom and pop trader had bought GOOG at $100. They would not sell at $102; they'd wait until $200 or $300. .25% means little in this case.
Had you read this thread, you might have learned that Schwab spoke about this tax at a recent conference. Schwab is very concerned about the impact of this tax on their business, as they should be. In fact, I wrote them an email pointing out their paradox that they advertise on Erin Burnett's show, who is speaking well of the tax, and suggesting that they withdraw their ads.
That said, yeah, it's possible that Schwab would survive. But "survive" may not mean what YOU think it means. Clearly their volume is going to go down. Short term trading likely encompassing well in excess of 70% of their volume. Volume down, revenue down, earnings negative. The next step is Schwab lays off employees. Did you ever see some of the early Schwab offices? The look like skeletons of the current Schwab office. Lots of employees would lose their jobs. Schwab cuts back on services, has to vacate their real estate, etc etc etc etc.
And then comes the commission increases. So you think the tax is alot, PLUS the increases spread, now add in that increased commission. You'll need a major move just to get even.
You remind me of some of the Obama supporters in the last election. No matter what he said, or the conclusions you could draw, people were for him, the "change you can believe in" type of thing. Now I wonder what some of the supporters have to say eh? Either way, this is the real world, once the tax is in effect, it's too late. Changes will take place that will help to destroy what little is left of this country. Guys like you need to take your head out of your ass.
OldTrader
Quote from Midas:
It does further down the article.
Their proposing this internationally on "U.S. Citizens" that trade from other countries. They can't touch citizens of other countries that don't have this tax. This is why I've been exploring the whole citizenship thing with Canada, as they wouldn't be able to impose this tax on a U.S. citizen that was able to obtain citizenship in another country, and they traded from there.
Quote from rsikit:
I thought I saw it say in the morning but I will try and find when they have it scheduled, they keep talking about it on cnbc, but I usually tune them out. Will let you know when I find out
I'm sending Liz Clayman an e-mail, asking that she have Geithner talk about the transaction tax.
Since it hits all traders equally, no matter what broker, it would change the trade cost to be $21 at places like IB and $28.95 at places like Schwab. This would hurt IB more than Schwab, as people would see they're now saving less than 1/3 by going to a broker that has longer phone support wait times, extra charges for cancels, etc.Quote from DisciplinedHedg:
If tomorrow Schwab raised their commissions to $28.95 per trade, do you think it would mean little to retail traders? Do you think it would affect Schwab only a little?
I think most of Schwab's revenue is from its advisory services. Their active daytraders, especially from Cybertrader, have probably long left for less expensive firms. My point is that if the cost difference between brokers is now less than a third instead of a factor of 10, the brokers will differentiate themselves mostly by service, and places like Schwab will survive.Quote from OldTrader:
That said, yeah, it's possible that Schwab would survive. But "survive" may not mean what YOU think it means. Clearly their volume is going to go down. Short term trading likely encompassing well in excess of 70% of their volume. Volume down, revenue down, earnings negative.
Yes, I've seen their offices shrink. The one near me moved to smaller quarters a couple doors down; their old office is now occupied by TD Ameritrade.
Quote from loufah:
Since it hits all traders equally, no matter what broker, it would change the trade cost to be $21 at places like IB and $28.95 at places like Schwab. This would hurt IB more than Schwab, as people would see they're now saving less than 1/3 by going to a broker that has longer phone support wait times, extra charges for cancels, etc.
At this point, I don't think anyone cares about which brokers would survive or do better than the rest.
Bottom line is that this transaction tax is bad for retail trading and beyond. And it would hurt all brokerages across the board. But more importantly, hurt traders.
Quote from Billy Thunder:
I would like to remind everyone that there are over 10,000 hedge funds registered in the Cayman Islands.
Oops, looks like there's someone in Cayman Islands now proposing a trans tax (just an op-ed piece, nothing big):
http://www.caymannetnews.com/news-19483--8-8---.html
Perhaps the time is now right for Cayman to show the rest of the world the way forward in raising public revenue from financial transactions occurring within our borders or with entities registered or licensed here.