This article is nothing but sheer desperation. They know the IMF is going to endorse the Insurance Levy's over any Tobin Tax. They must also be nervous, upset, and prone to making up stories about the administration changing their minds because the G7 conference did nothing to bring any momentum to these pro-Tobin Tax morons. But let's just say hypothetically that the administration did flip-flop on the issue. That would be meaningless, as any decision on this would require Congressional approval. There's no way the votes are there to even remotely pass this, and when the GOP gains several Senate seats, and possibly takes the House majority in Nov., this issue can silenced significantly, if not permanently.
I agree. I highly doubt the admin would flip flop on this FTT issue. They would like like idiots on the world stage if they did that after all they have done to 'squash' this tax. This tax ain't happening... -Guru
Well I just read the piece and I think it's garbage. They mention the head of the IMF (DSK) flip flopping on the Tobin Tax issue after the G20 meeting. I believe this was done to appease Gordon Brown, etc saying instead they would study the possibility of a Tobin Tax. I still believe both DSK and his #2 guy Lipsky are opposed to a Tobin Tax...I can almost guarnantee that when the IMF report comes out in April they won't be praising the Tobin Tax. As far as the Obama admin and GS flip flopping on the issue and supporting it I just don't see that happening either. This tax would do immense harm to the economy not to mention the average investor. This article sounds like a whole lot of conspiracy theory to me -Guru
http://m.ft.com/cms/s/0/0330ba78-14...?catid=2&SID=3420d2cee98a482d5db98964a6bddffb this article about speculators ganging up against the Euro and EU governments complaining about speculators explains well why FTT advocates are attacking speculators with a tax to put them out of business. It's to quelsh market discipline and public controls. Is Spain trying to assuage bond investors with hallow promises about reining in spending? Socialist big spending governments and their supporting political-economists like Krugman and Baker can't stand the heat of free markets who can sell rather than buy into their theories. Without speculators holding them to reality and the truth you get an even bigger crash and unsustainable bubble later on. Trying to restrict short sellers is market manipulation and government over reach and abusive of the public trust. A Communist country like China can get away with it but not free country governments. The US restricted bank short selling during the bank meltdown. This contagion is for real. Stimulus just put problems under the rug and the government spending is worse and about the be the straw to break the camels back. Every time big spending economists and governments say speculators are useless or bad we know how to reply. Another article in FT today talks about new short selling restrictions coming. How short selling disclosures have had the reverse effect of causing more short selling. Duh! Highly regarded traders disclose short positions and copycats put on the same positions. Funny thing about George Soros. He got billionaire-rich shaking down (shorting) the Bank of England pound in the early/mid 1990s and the G7 changed their rules on dealing with currency speculators after that - the rules meaning they learned how to deceive the speculators. Ever since then to repair his image, Mr. Soros has been Mr. Charity and a guru for the left and Democratic causes like MoveOn.com I believe. Didn't Soros give some credence to the FTT too? Well his old-dog stripes came out this past few weeks and he is back shaking down the Euro with some good old short seller talk. Quickly double checked some of these statements on Soros. Per Wiki on Tobin Tax, "It should be noted that in those same "years" that Buiter spoke of, the Tobin tax was also "adopted" or supported in varying degrees by the people who were not, as he put it, "enemies of trade liberalisation." Among them were several supporters from 1990 to 1999, including Larry Summers and several from 2000 to 2004, including lukewarm support from George Soros." George Soros Funds MoveOn.org. http://www.traditionalvalues.org/read/1852/atheist-george-soros-funds-moveonorg/ Why is George Soros Short the Euro? MUST READ! http://www.noquarterusa.net/blog/2009/03/03/why-is-george-soros-short-the-euro-must-read/. From 2009 but remember reading he is talking down the Euro from last week. Typical of some left-leaning elitists, say one thing to get applause and do another to make money. --------------- Note, the last few weeks, my posts have been a little off tangent, because I think we are winning the tangent and others give the links and comments that I see too. I am just trying to think ahead to what could be coming next and to comment on related issues.
Newamerican article discussed above is a far-fetched conspiracy theory. Don't agree that a FTT would be good for Goldman. They fast trade millions of transactions on trading desks and that would never be exempt from FTT. Also disagree that the US administration would support the tax. FTT is a tax increase on the middle-class which is against the admin's platform. A bank fee is more targeted. This entire article is about his fear of a global tax supporting a global government and that writer deeply doesn't trust a global government or conspiratists trying to trick us into it. That fear can be used for our efforts. Many Americans will reject a global tax and global sovereingty trumping America's sovereingty. My article on FTT in Active Trader talked about proponents wanting the first Euro Tax or global tax. It's another argument to call proponents out on.
Perhaps they should find some time to read the Council Directive 2008/7/EC of 12 February 2008 concerning indirect taxes on the raising of capital. "It provides for a general prohibition on such taxes, notably capital duty, though certain countries may continue levying it for the time being" (see: http://europa.eu/legislation_summaries/taxation/l25098_en.htm ). Article 5 par. 2 clearly states that "2. Member States shall not subject the following to any form of indirect tax whatsoever: (a) the creation, issue, admission to quotation on a stock exchange, making available on the market or dealing in stocks, shares or other securities of the same type, or of the certificates representing such securities, by whomsoever issued; (b) loans, including government bonds, raised by the issue of debentures or other negotiable securities, by whomsoever issued, or any formalities relating thereto, or the creation, issue, admission to quotation on a stock exchange, making available on the market or dealing in such debentures or other negotiable securities." (see: http://eur-lex.europa.eu/smartapi/cgi/sga_doc?smartapi!celexplus!prod!DocNumber&lg=en&type_doc=Directive&an_doc=2008&nu_doc=7 ) This Directive article was later cited as a legal argument against the introduction of an EU-wide financial transaction tax in the written answer from 3 September 2009 of Commissioner Kovacs (for Taxation) to a Parliamentary Committee, where he stated that "Besides the economic arguments, the introduction of such a tax must be reviewed with regard to its compatibility with the 2008/7/EU7 guideline from February 12, 2008. In article 5 (2) of this guideline it says that "The member states will not levy an indirect tax of any kind on... the trading of stocks, shares, or other similar financial instruments as well as the certificates of such financial instruments ... on borrowings including pensions." " (apologies for nested quotations). Kovacs concludes his answer: "The commission is therefore of the opinion that stabilisation and regulation of the financial markets should take place more effectively via an optimised international financial market oversight and has prepared corresponding suggestions in this regard. At the current time, a transaction tax appears to be an unsuitable instrument due to the potential risks, the low degree of verified knowledge about its effects as well as the legal imponderability. (see: www(dot)greens-efa.org/cms/topics/dokbin/302/302464.introduction_of_an_euwide_financial_tran@de.pdf ). "The European Commission, however, is not planning any measures at present and for the time being is just following the international debate, as "we don't know to what extent it will affect speculation, stability", said Alexander Wiedow, the European Commission's director for taxation and customs union, during a public hearing held by the European Parliament's Economic and Monetary Affairs Committee on 3 December 2009 (see press release: http://www.europarl.europa.eu/news/...IPR65915-03-12-2009-2009-false/default_en.htm) Even such overtly anti-capitalist t(h)inkers as Stiglitz, while pronouncing the end of history (not again), still do not propose "Tobin-style" taxes, not even in his latest post-crisis crop called "Freefall", where he restricts himself to: - not allowing banks to use incentive structures that encourage excessive risk-taking, - forcing more transparency, - requiring banks that engage in high-risk activities to put up much more capital and to pay high deposit insurance fees, - limiting leverage "much more", - placing restrictions on particularly risky products, and of course: - the federal government should reinstitute some revised version of the Glass-Steagall Act (see: www(dot)impactlab.com/2010/01/25/joseph-stiglitz-explains-why-we-have-to-change-capitalism/ and apologies for the in-text ad for "Hybrid Mini Crank Lantern 3Pk at $18.99" (I still recommend you give the "Freefall" a thumb down and instead use your illicit speculative gains to lavish your Valentine with some of Evan Davis' quality publications, because the BBC has apparently managed to oppose both Brown's and Oxfam's spin-doctors. Yes, where's that 0.005% Madonna? Definitely not on Radio 4! So guys, these sources are probably more indicative of future events, not those second-hand essays of organizations whose main stated objective is to put Tobin's reheated cabbage on the G7 agenda (these include Stamp Out Poverty, Halifax Initiative, and of course that Baker's firm whose name escapes me, as well as many, many others, even more "progressive"). You might have noticed I changed my mind about Mr. Baker - this is because I've just heard a nice chat by his favorite Nobel winner Prof. Stiglitz (see: http://www.bbc.co.uk/programmes/b00qgvzt) It was live, and without too many buzzer interjections, so Stiglitz is clearly innocent - not a single utterance of a 'tax' or even 'levy' for an entire 45 min. duration of the programme! And all that from a hardly pro-capitalist panel, where Enron's leveraged gamblers were the most benign depiction of what we did to society (I believe "Nero" and "666" were actually mentioned once So it is again the followers/hijackers like Baker who are to be feared most - not the irresponsible thinkers like Nietsche or Marx or James "They hijacked my name" Tobin (or indeed Joseph "I predicted that crisis" Stiglitz). Maybe once prof. Stiglitz is satisfied with the proceeds from his anti-capitalist book and is done with bankers bashing, he would use some of that Sveriges Riksbank Memorial Prize money to come over here to the truly Eastern Europe (not the New Jersey idealized version thereof) and visit SocLand- a little neo-commie equivalent of Auschwitz (see e.g. their movie archive at http://www.socland.pl/index.php?option=com_content&task=view&id=95&Itemid=67 ).
Yes even the blind Demos should be able to see how "blue collar" trading and investing have become. Just look at all the ads, even on Superbowl day, about trading and "taking control of your investments". Those ads aren't targeted toward "Rich Wall Street Fat Cats". And it won't take much to turn over a $100K limit, even by Joe the plumber and Marge the school teacher, etc...
EU parliament backs creation of bank crisis fund http://www.forexyard.com/en/news/parliament-backs-creation-of-bank-crisis-fund-2010-02-09T162615Z-EU EU-BANKFUND * EU lawmakers say banks should pay into emergency cash pot * Idea proposed by Swedes, examined by Germany * Move follows Obama push to collect money from bankers By John O'Donnell STRASBOURG, France, Feb 9 (Reuters) - The European Parliament is set to back a proposal that would force banks to pay into an emergency fund designed to help cope with future financial crises, a document seen by Reuters shows. Earlier this year, Sweden's finance minister called on European counterparts to follow U.S. President Barack Obama's lead with a bank tax to recoup the cost of propping up the industry -- an idea that Germany is now considering. The European Parliament, a powerful institution that will write any new bank tax into EU law, is set to give the idea a thumbs up, according to senior members of the assembly. In a report outlining how Brussels should set up a new authority to police banks, lawmakers outline their desire to establish a so-called European Financial Protection Fund to protect savers, banks in difficulty and the broader market. "This Fund will be financed through contributions from these institutions, debt issued by the Fund or in exceptional circumstances through contributions made by the affected," parliamentarians propose in a report written by Spanish deputy Jose-Manuel Garcia-Margallo Y Marfil. The lawmakers, who are currently working on new rules to tighten the policing of banking and place curbs on runaway lending, also highlight how EU countries could help foot the bill in an emergency. In the report, which has yet to be published officially, lawmakers also signal scope for a compromise with EU countries on the powers that should be given to new pan-European super-authorities to police banks as soon as next year. Earlier this year, Obama proposed that Wall Street pay up to $117 billion via a special levy to reimburse taxpayers for the financial bailout, saying "fat cat" bankers were making massive profits and "obscene" bonuses. Sweden has embarked on a mission to recoup roughly 75 billion Swedish crowns ($10.6 billion) from its banks that will then be set aside in a fund to cope with financial crises. It opted for a direct levy on bank loans rather than a tax on transactions -- such as buying investments -- because a similar move after the country's 1990s banking crisis backfired. Britain's opposition Conservatives, who are widely expected to return to power at national elections this year, have also voiced support for the Swedish idea if applied globally.
The current political climate is moving towards gridlock. The Republican party line is to put up a unified front against new taxes. The Democratic party line to not to curtail govenment programs or spending with neither willing to budge. We are not out of the woods by any means. This tax will be brought up again and again I am afraid. However, the has situation has improved over the past year. Domestically 1)The Senate is no longer filibuster proof 2)The Administration has come out in favor of alternative taxes on the financial industry 3)Democrats are moving away from far left "progressives" with elections this fall. 4)anti tax movements are taking root across the nation (think tea party) Internationally 1)Tobin style taxes have taken a back seat to an insurance type levy. 2)There is universal understanding among most g 20 nations with market share, that a tobin tax would need to be global. 3)UK Labour is in trouble politically.
Internationally 1)Tobin style taxes have taken a back seat to an insurance type levy. 2)There is universal understanding among most g 20 nations with market share, that a tobin tax would need to be global. 3)UK Labour is in trouble politically. [/B][/QUOTE] Exactly right. In addition, if there were any sort of global agreement reached among the G20 nations, it would be in support of the insurance levy. There is simply no way that a consensus could be reached globally on a Tobin tax. Even the EU Parliament is caving and are now set to back an insurance type levy with the U.S. It's also just a matter of time before Germany falls in line. As for the U.K., once conservative candidate David Cameron defeats Gordon Brown, and a new conservative majority Gov't. is in place, they will also support the insurance levy, provided it has global agreement.