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

Eurozone-only transaction tax possible: Germany

A proposed tax on financial transactions could be introduced in the eurozone alone, German Finance Minister Wolfgang Schaeuble said in an interview to be published Sunday.
"The ban on 'naked' short selling was only the beginning of the measures we are taking," Schaeuble told Bild am Sonntag.
"Before the end of the autumn we are going to create a tax on financial transactions. If necessary, I'm sure, just in the eurozone," he added.

http://www.google.com/hostednews/af...ocId=CNG.a384f19a3236237b50eb9007a6386321.1a1

There resistance from the U.K. and Sweden per the WSJ article; other countries hardly look uniformly enthusiastic.

Geithner is clearly opposed as he has made clear again and again

It looks to be difficult even for the eurozone to agree amongst themselves and to get this in the eurozone as a whole--so then what? Do countries go ahead, a few of them, or some individually?

Seems a recipe for capital flight.
 
In addition to Sweden, the Netherlands, Denmark, Malta and Ireland have all said they wouldn't even consider the FTT unless the UK is part of the package. On more than one occasion the Netherlands Finance Minister, Jan Kees de Jager, has said that if the UK is not included in any type of EU FTT, a large part of the Dutch financial industry will pack up and move to London. Therefore the Netherlands rejects the FTT until London agrees to participate. London won't do it because they know that a large part of their financial market will pack up and move to New York, Singapore, Hong Kong, etc. As long as London holds firm, the EU FTT is DOA.

Quote from ksharmon:

Eurozone-only transaction tax possible: Germany

A proposed tax on financial transactions could be introduced in the eurozone alone, German Finance Minister Wolfgang Schaeuble said in an interview to be published Sunday.
"The ban on 'naked' short selling was only the beginning of the measures we are taking," Schaeuble told Bild am Sonntag.
"Before the end of the autumn we are going to create a tax on financial transactions. If necessary, I'm sure, just in the eurozone," he added.

http://www.google.com/hostednews/af...ocId=CNG.a384f19a3236237b50eb9007a6386321.1a1

There resistance from the U.K. and Sweden per the WSJ article; other countries hardly look uniformly enthusiastic.

Geithner is clearly opposed as he has made clear again and again

It looks to be difficult even for the eurozone to agree amongst themselves and to get this in the eurozone as a whole--so then what? Do countries go ahead, a few of them, or some individually?

Seems a recipe for capital flight.
More...
 
Here's the Schauble letter, with 4-page attachment


http://www.economie.gouv.fr/files/lettre-franco-allemande.pdf

Anders Borg also contributed words of caution:

"We have substantial experience in Sweden. Basically most of our derivative and bond trading went to London during the years we had a financial transaction tax. So if you don’t get a solution that is universal it is very likely to be detrimental for European financial markets. And from the Swedish perspective, we cannot foresee that we would introduce such a tax in our system again".
 
Do you think Schaeuble believes that a FTT will stop speculators and short sellers and the financial markets will recover and the PIIGS debt crisis will abate? He seems to blame the crisis on traders. Doesn't the EU need speculators to gamble on buying these assets, at a discount, when others are afraid to?

I hope Schaeuble studies some economics or is replaced fast. His policies don't make any sense.
 
Why is it that 70% of the European countries are unable to learn anything from the Swedish FTT debacle?


Quote from andohmeeta:

Here's the Schauble letter, with 4-page attachment


http://www.economie.gouv.fr/files/lettre-franco-allemande.pdf

Anders Borg also contributed words of caution:

"We have substantial experience in Sweden. Basically most of our derivative and bond trading went to London during the years we had a financial transaction tax. So if you don’t get a solution that is universal it is very likely to be detrimental for European financial markets. And from the Swedish perspective, we cannot foresee that we would introduce such a tax in our system again".
More...
 
I live in Denmark and our newly elected government Social Democrats: http://s-dialog.dk/default.aspx?site=english&
has been talking a lot about the financial transaction tax and the traders here i Denmark are angry and frustrated...just as you are :cool:

However.... I was thinking...

Would this tax be such a big deal of the swings just was proportional bigger?

What if the introduction of FTT would have the exactly opposite effect?

So instead of an i.e. equity with 2% range just would adapt into a 2.5%. Everyone would still be happy right?
 
Schaueble's FTT letter is scary. His FTT plan will be another employment act for accountants and IT people. It's going to be a monstrosity to implement and execute and it will also tie up auditors too.

The UBS rogue trader story is about banks still struggling with internal controls, accountants and IT. FTT will be a new costly burden and it could lead to even more complex hard to account for transactions and blow ups.

I hope Deutsch Bank's Ackerman can use his clout before turning the helm over to non-German Ashu Jain, new co-CEO. Pull a JP Morgan CEO Jamie Dimon move and threaten leaving Germany. Why move Jain to Germany, move DB to London.

Schaueble needs to be reined in. One guy can't be allowed to do this much damage, especially in a politically-fractured Germany.
 
I don't think backbone comes into it. An FTT runs directly counter to UK interests and taxation is still within the remit of individual countries - although this is precisely what the commssion wants to change.

The way it stands today, the commission can't exert pressure in this area - nor can other countries - so there's no reason for the UK not to hold firm.

I thought the article quoted was quite poor from memory ( I can't access it anymore), and I would have expected better from the FT.
 
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