If my memory serves me well, the French have banned short selling as and when they have seen the need. If targeted, they simply do that and it takes away the profit from the market decline.
1/4% Tax on all stock trades pushed in NY Times today
- Thread starter seasideheights
- Start date
If my memory serves me well, the French have banned short selling as and when they have seen the need. If targeted, they simply do that and it takes away the profit from the market decline.
Volume won't drop as banks will use the loopholes to trade without it. Politicians will hail it as a victory but they won't mention that the tax won't be raising almost any revenues - that piece of information will be buried so deep, no one will find it.
Main street will be ignorant and happy as long as the "bad bankers" are paying, not realizing they are the only ones paying this tax.
Only market making activities( and passive stat arb )can still be traded tax free by the banks. They will sure continue to quote the same B/A spread but there won't be for sure the same volume of trading due to the number of active counterparts who will cease trading, beginning with HFs and HFTs that are also trageted by the HFT tax.
Really good remark about short selling ban. They can interfere with a HF induced crack.
If HFs from UK, US, Asia, Switzerland... start to short french assets consecutively to the new FTT, they can ban short selling on the taxed products. It won't make the market stabilize( the market still fell after short selling ban in 2008 ) but it can stop the downward pressure.
At first short selling bans were ineffective, you just had to buy puts instead of shorting stocks, but the latest bans in 2011 were more effective. They also covered alternatives, bullets, index futures...
A market with no bids needs no shorts to fall.
http://www.thenewamerican.com/usnews/congress/item/12055-the-robin-hood-tax-scam-is-back
Harkin-DeFazio, Tobin, Congressional Budget Office, Soros
Harkin-DeFazio, Tobin, Congressional Budget Office, Soros
Brokers Lament French Tax Tour de Farce
Two brokers have privately described the ongoing confusion as "mayhem".
http://www.google.com/url?sa=t&rct=...sg=AFQjCNGKTF9vsm1pAckNKCJfrsJ46-1INg&cad=rja
Two brokers have privately described the ongoing confusion as "mayhem".
http://www.google.com/url?sa=t&rct=...sg=AFQjCNGKTF9vsm1pAckNKCJfrsJ46-1INg&cad=rja
"legislate in haste repent in leisure"
the french will be stuck with the ftt for years.
in india, a few years ago, when the country was booming they talked about repealing their ftt in order to make their markets more liquid. it never happened.
don't think it cannot happen in america. the financial institutions which benefit from crony capitalism will allow it to come into existence in some kind of backdoor deal.