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SEC to Nearly Double Equity Transaction Fee
- Thread starter Toonces
- Start date
For those of you have have not read "Take On The Street" by former SEC Chariman Arthuir Levitt, I would highly recommend it in light of this discussion.
I used to think (read, know) the markets were generally corrupt at most levels, that the big guys made out at the little guy's expense, and that even the latest regs and fines don't amount to anything. If Levitt is accurate - and there has been nothing to suggest the contrary from those named in the book - the industry is far more corrupt than even the most cynical have speculated.
I'm only half way through the book, but Levitt repeatedly details efforts to make (even very minor) changes to numerous policies that would benefit the average investor. The pattern of interference is always the same. It starts with a few phone calls from trade groups and executives. If they are unsuccessful and the SEC presses forward, phone calls from Congressmen soon follow, sometimes accompanied by personal visits.
In the end, certain congressmen either threaten to pass counteractive legislation to negate the SEC action (by removing funding for the implementation of the effort), or the threat is made to cut the SEC budget altogether, thereby rendering the agency even more ineffective.
As with most things in life, it's all about the money. Anything that would cause negative consequences for a company is evaluated, given a price tag, then assigned a lobbyist with a percentage of the consequence price as his budget.
If you believe Levitt's assertions, the SEC was neutered long ago by Congress.
I used to think (read, know) the markets were generally corrupt at most levels, that the big guys made out at the little guy's expense, and that even the latest regs and fines don't amount to anything. If Levitt is accurate - and there has been nothing to suggest the contrary from those named in the book - the industry is far more corrupt than even the most cynical have speculated.
I'm only half way through the book, but Levitt repeatedly details efforts to make (even very minor) changes to numerous policies that would benefit the average investor. The pattern of interference is always the same. It starts with a few phone calls from trade groups and executives. If they are unsuccessful and the SEC presses forward, phone calls from Congressmen soon follow, sometimes accompanied by personal visits.
In the end, certain congressmen either threaten to pass counteractive legislation to negate the SEC action (by removing funding for the implementation of the effort), or the threat is made to cut the SEC budget altogether, thereby rendering the agency even more ineffective.
As with most things in life, it's all about the money. Anything that would cause negative consequences for a company is evaluated, given a price tag, then assigned a lobbyist with a percentage of the consequence price as his budget.
If you believe Levitt's assertions, the SEC was neutered long ago by Congress.
A little too dramatic - geez! It's not exactly a conspiracy, pretty simple really.. SEC needs more $$ to crack down on "evildoers" combined with a dramatic decrease in volume on the exchanges.
The OMB re-evaluates every year and given current conditions, raises the rate this year. It does suck for high volume traders that pay SECs (like me), and brokers that absorb it for their clients, but complaining about it won't do any good. At least we don't have a tax happy Dem in the White House that would raise income rates too!
The OMB re-evaluates every year and given current conditions, raises the rate this year. It does suck for high volume traders that pay SECs (like me), and brokers that absorb it for their clients, but complaining about it won't do any good. At least we don't have a tax happy Dem in the White House that would raise income rates too!
fl trader,
I suppose my characterization of the SEC fee increase as a conspiracy is a little over dramatic. But why does the SEC put this line in the memo:
So much for the "getting more $$$ to crack down on the evil doers"
I suppose my characterization of the SEC fee increase as a conspiracy is a little over dramatic. But why does the SEC put this line in the memo:
Quote from MACD_addy:
Oh and I love this line;
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The Commission does not receive any additional funding as a result of the increase in the fee rate.
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well what the fuck are they raising the fee for!
So much for the "getting more $$$ to crack down on the evil doers"
NASDAQ Average Daily Dollar Volume
Month Average Daily Dollar Volume
Sep 2001 33,880,258,290
Oct 2001 36,093,363,082
Nov 2001 37,783,717,538
Dec 2001 36,180,879,319
Jan 2002 40,795,835,947
Feb 2002 35,856,651,781
Mar 2002 34,487,101,598
Apr 2002 32,057,620,849
May 2002 29,778,916,524
Jun 2002 29,402,347,972
Jul 2002 28,078,595,065
Aug 2002 21,236,814,936
Sep 2002 20,504,634,460
I would assume declining volume on NYSE and AMEX as well.
I don't mean to be defending higher taxes, I don't like taxes - but given the decrease in dollar volume, they would have to raise rates to keep their current level of funding.
Personally, I'm pissed at CNBC. If they would stop their cheerleading, maybe we could get all the false hope out, and get to a bottom in this bear mkt. Return of the Bull mkt will bring higher dollar volume and (hopefully) reduced SEC rates.
Month Average Daily Dollar Volume
Sep 2001 33,880,258,290
Oct 2001 36,093,363,082
Nov 2001 37,783,717,538
Dec 2001 36,180,879,319
Jan 2002 40,795,835,947
Feb 2002 35,856,651,781
Mar 2002 34,487,101,598
Apr 2002 32,057,620,849
May 2002 29,778,916,524
Jun 2002 29,402,347,972
Jul 2002 28,078,595,065
Aug 2002 21,236,814,936
Sep 2002 20,504,634,460
I would assume declining volume on NYSE and AMEX as well.
I don't mean to be defending higher taxes, I don't like taxes - but given the decrease in dollar volume, they would have to raise rates to keep their current level of funding.
Personally, I'm pissed at CNBC. If they would stop their cheerleading, maybe we could get all the false hope out, and get to a bottom in this bear mkt. Return of the Bull mkt will bring higher dollar volume and (hopefully) reduced SEC rates.
SEC Enforcement Actions Seen Declining
8:56 PM WASHINGTON (Reuters) - The U.S. Securities and Exchange Commission will probably bring fewer enforcement actions in the future than it did in the most recently ended fiscal year, said a top SEC enforcement official on Saturday.
http://biz.yahoo.com/rb/030301/financial_sec_enforcement_1.html
SEC asking for more, but doing less. What a racket.
8:56 PM WASHINGTON (Reuters) - The U.S. Securities and Exchange Commission will probably bring fewer enforcement actions in the future than it did in the most recently ended fiscal year, said a top SEC enforcement official on Saturday.
http://biz.yahoo.com/rb/030301/financial_sec_enforcement_1.html
SEC asking for more, but doing less. What a racket.
If dollar volumes are declining then the "enforcement" business must be declining as well, right? If this is indeed the case then the SEC might consider cutting staff like a private sector business would do, rather than raising rates for their smaller remaining contingent of customers to do less work for the same money. Then again since when has the business of public service ever been a true service to those in need or ever mirrored the efficiency of the private sector?