Oh look, I was right The Death of the Eurozone http://finance.yahoo.com/blogs/brea...G9mdGg-?sec=topStories&pos=main&asset=&ccode=
Scalping for pennies looks like its on the way out. I wonder what the markets would look like without all the HFT noise.
Analysis: Viability of Sarkozy's euro crisis ideas in question http://news.yahoo.com/analysis-viability-sarkozys-euro-crisis-ideas-145339924.html "Such a tax -- first put forward by economist James Tobin in the early 1970s -- could only function if imposed across the board, otherwise trading would flee to tax-free markets, but the European Central Bank and non-euro member Britain oppose it. "It is hard to understand how they can do something on that within the timetable of September. The ECB has made it clear it is totally opposed to the tax, as have several other governments," said UBS senior European economist Stephane Deo. Only Austria and Italy said they would support the tax. edited: I didn't even know the ECB was against it all along...this is not going anywhere.
On second thought, I would love to see what would happen if all the HFT began to concentrate their activities to the tax-free markets only. It would be a melee of epic proportions.
Looks now that merkel/sarkozy are getting really serious about implementing it. http://blogs.reuters.com/great-debate/2011/08/17/merkel-and-sarkozy-are-right-about-a-tobin-tax/ After all, day trading is such an anti-social activity. And daytraders have to lose their jobs to make them more social. yes yes "Arbeit macht frei". These stupids never get the idea that they cannot collect taxes from a business they destroy.
You don't think that HFT/Algo is going to destroy the business anyway? I'd say the calamity it's causing they won't need to wait for an EU law.
0.1% of transaction value means: 130k eur x 0.1% = 130 eur for buy and 130 for sell. total 260 eur. or over 10 dax points. good luck btw, all these talks about 13 banking families and vatican running the financial arena are just silly conspiracy nutty stuff.
Lets say for arguments sake that you bought 10 FGBS @109.60 and sold them at 109.64 netting a 40 tick profit. What do you think the trans tax on that trade would be at a rate of 0.1%?
HTT and algos are a running business. Their capital gains will be taxed after all like any other income. You destroy this business then you'll have nothing at all. And there are still more people/traders than algos trading. Stupids just blame anything for something they cannot understand. And those stupids are either people who have never traded themselves, or they do and lose because they lack in skills and knowledge of this business. Nobody is forced to trade or to invest. And everybody who does does so voluntarily, and knows about the risks. Otherwise he/she should stay out of the markets. This is just witch hunt. Sweden had a tobin tax years ago. And guess why they gave it up. Back then there weren't so many algos. -------- http://en.wikipedia.org/wiki/Tobin_...e_form_of_general_financial_transaction_taxes Sweden's experience in implementing Tobin taxes in the form of general financial transaction taxesIn July, 2006, analyst Marion G. Wrobel examined the actual international experiences of various countries in implementing financial transaction taxes.[43] Wrobel's paper highlighted the Swedish experience with financial transaction taxes. In January 1984, Sweden introduced a 0.5% tax on the purchase or sale of an equity security. Thus a round trip (purchase and sale) transaction resulted in a 1% tax. In July 1986 the rate was doubled. In January 1989, a considerably lower tax of 0.002% on fixed-income securities was introduced for a security with a maturity of 90 days or less. On a bond with a maturity of five years or more, the tax was 0.003%. The revenues from taxes were disappointing; for example, revenues from the tax on fixed-income securities were initially expected to amount to 1,500 million Swedish kroner per year. They did not amount to more than 80 million Swedish kroner in any year and the average was closer to 50 million.[44] In addition, as taxable trading volumes fell, so did revenues from capital gains taxes, entirely offsetting revenues from the equity transactions tax that had grown to 4,000 million Swedish kroner by 1988.[45] On the day that the tax was announced, share prices fell by 2.2%. But there was leakage of information prior to the announcement, which might explain the 5.35% price decline in the 30 days prior to the announcement. When the tax was doubled, prices again fell by another 1%. These declines were in line with the capitalized value of future tax payments resulting from expected trades. It was further felt that the taxes on fixed-income securities only served to increase the cost of government borrowing, providing another argument against the tax. Even though the tax on fixed-income securities was much lower than that on equities, the impact on market trading was much more dramatic. During the first week of the tax, the volume of bond trading fell by 85%, even though the tax rate on five-year bonds was only 0.003%. The volume of futures trading fell by 98% and the options trading market disappeared. On 15 April 1990, the tax on fixed-income securities was abolished. In January 1991 the rates on the remaining taxes were cut in half and by the end of the year they were abolished completely. Once the taxes were eliminated, trading volumes returned and grew substantially in the 1990s. ------- "Geh arbeiten du soziale Sau!" just joking