I Commented on the article and it's Called Out since I am a Forbes blogger. Take a look and pile on with me.
Berlin (dpa) - German Chancellor Angela Merkel proposed Thursday the creation of new European Union funds for special projects to be financed by the money raised through a financial transactions tax. Speaking in parliament ahead of a summit of the 27 EU leaders in Brussels Thursday, Merkel said the funds would result in an increase in competition. The chancellor said that EU states that are not members of the 17-state eurozone could also participate in the funds. http://en.europeonline-magazine.eu/...unds-financed-by-transactions-tax_244297.html Presumably a special project for making up losses in GDP caused by a transaction tax isn't what she is thinking of.
The French financial transaction tax has hit small cap stocks "particularly hard", with average daily turnover in smaller companies falling 26% during August and September compared with the first seven months of the year, according to Credit Suisse.[...] http://www.efinancialnews.com/story/2012-10-18/french-tax-hits-small-caps
What would be mechanism for FTT hitting small caps? My impression was that French FTT is limited to companies with capitalization of more than 1 billion euros. Anyone would like to comment on it because I do not have any French FTT details handy.
You are right. It's perhaps the HFT part of the french FTT. If volume was coming from a HFT firm based in France that didn't have the "market maker" status( exempted of all taxes ), they simply stopped trading. Anyway 26 % is not a big figure. It would be great to see the effect on SBF 120...
http://www.elitetrader.com/vb/showthread.php?s=&postid=3656896#post3656896 i wonder whether there were any ignorant posters on this thread who have attacked hft traders. if they lose u lose.
That's a great idea. There is no sense in EU FTT and in this scenario arguing with logic is not a worthwhile endeavor. The public is just tilting at windmills and convincing them otherwise is not likely to succeed either. I think at this point some Asian countries should introduce a kind of trader's visa, would be a smart move on their behalf - if Europe does not want my taxes then I'm sure some other country will.
In Report, Speed Tradesâ Problems and Pluses - NYTimes.com http://www.nytimes.com/2012/10/23/business/in-report-speed-trades-problems-and-pluses.html Score one for HFT. The major British government report says it improves prices for investors. This report can help make the point that FTT will make prices for investors worse, with the opposite effect.
Italy's transactions tax seen hitting trading | Reuters http://www.reuters.com/article/2012/10/22/italy-transactions-tax-idUSL5E8LMDZK20121022 Italy is rushing to pass their own FTT by Jan 1, 2013, probably to keep the tax revenue in Italy, rather than pay it to Brussels. They factored in a 30% drop in share trading and 80% drop in derivatives. Brokers won't be happy and let's see how Italian markets react if it comes to fruition.
http://blogs.ft.com/brusselsblog/20...saction-tax-faithful-march-on/?#axzz2AD1TVhRh So they still think a Chinese man selling an option to an American will pay the tax to authority's hundreds of miles away.