Besides being very active on the FTT thread, I've been commenting in WSJ and FT on every NYSE Deutsche bourse merger article.
I've said it's crazy for NYSE to merge with the German exchange as Germany is hostile to banking, finance and exchanges. Germany will try to use the merger to spread their FTT beyond the euro zone and also over regulate all instruments including derivatives.
This merger is like if Ford wanted to merge with Mercedes just before WWII. The exchanges are too focused on savings, reduced competition, diversification, global reach and bigness. When it comes to Germany and France, run for the rafters, they are falling to socialist forces and have the pitchforks out for banking.
Does anybody here know anyone on the NYSE board? Or know someone who knows anyone on the NYSE board? I'd be curious to know whether this issue has caused misgivings.
most of the merkel/sarkozy political moves, as of late, have to do with their internal election aspirations. the "occupy whatever" movements have had a huge political impact in EU and the main countries have been very active outlining a socially conscious agenda in order to gain approval from the masses, especially now that we are approaching election cycle in both of these countries.
most of the rhetoric concerning the ambitions of a wide spread FTT is targeted to win the support from the majority of citizens that consider the banking industry responsible for the economic crisis of last years.
this is just political marketing, their goal is not to pass a law but to win the elections.
The idea is to force the FTT onto UK and US through regulatory subterfuge. The ongoing UK/EU fandango is well-documented. The NYSE situation is far sneakier. Basically, NYSE/Deustche Boerse would be required to levy a transaction fee equivalent to the German FTT levied on each transaction. The proceeds would go to Berlin. Absolutely no US regulatory involvement.
If the point of the tax is to fund future inevitable bailouts, it's fine. Somebody has to pay for it...
Other taxes will increase to pay for the cost of collecting the transaction tax:
"Swedish Finance Minister Anders Borg pointed out that a financial transactions tax in his country saw implementation costs out-run revenues."
http://msn.finance.com.my/index.php/rss/5504278
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Other taxes will increase to compensate for revenue losses the transaction tax creates. Other taxes will increase to compensate the unemployed.
From the UK Parliament's European Scrutiny Committee regarding the minimum tax rate of the FTT. They are using data from the European Commission that wants the tax so badly as their own source of revenue:
"...taking these figures in turn and before taking into account relocation effects, in real economic impacts it can be estimated that a reduction of 1.76% of EU GDP equates to a fall in economic output of €216 (£186) billion, a fall in employment of 0.2% equates to a loss of 478,000 jobs, a 3.43 % fall in EU GDP equates to a fall in economic output worth €421 (£362) billion and a 0.34% fall in employment equates to a loss of 812,000 jobs."
