no, you aren't missing anything. and actually it would increase volatility and widen spreads, since there would be so little liquidity.
In Europe they speak again about that tax too (december 2018). Transactions on shares and bonds would be taxed at 0.1%, and derivative products at 0.01%. The FTT would have to be paid if at least one of the parties is based in the EU. That was the latest info on the level of taxation. So it would mean $14 for the ES mini, not $140. Belgium and Slovakia are blocking at this moment the application of the tax. https://www.cnbc.com/2019/03/05/bus...al-transaction-tax-proposed-by-democrats.html The 0.1% tax would be for securities. Futures are no securities but derivatives I think, or am I wrong?
https://www.difc.ae/ If this bill passes these people should make a move and expand their business. They are eager for new business and have the (almost unlimited) finances to become the new Wall Street. Multinationals could open an office (or even their main headquarters) in Dubai and manage from there their finances. Just like they did in the past to pay less taxes (going thru the Netherlands, Ireland, Bermuda, Cayman, Bahamas or other fiscaly attractive places). https://www.taxjustice.net/2014/11/10/netherlands-worlds-largest-source-fdi/ http://www.royalgazette.com/interna...0190228/us-multinationals-25bn-bermuda-profit
Illinois lawmakers make case for financial transactions tax https://www.ilnews.org/news/economy...b5NLEpHTKqRSAGm6bGf4wQaq47Y7vhf1bX4pRiFrv1uMk
This is the best part: "It would have been difficult for me to go to the state legislature and say, 'You know what, I'm going to move and I gotta take 6,000 traders with me and disrupt their families.' That's not the case anymore," Chicago Mercantile Exchange president Terry Duffy said last year, referring to CME's transition to online trading. "We sold our data center. We sold everything we have in agreement with that data center. They own 22 other data centers in the United States. They could move us into any one of them." If this FTT taxes gets real I move to forex. No problemo. I explained already before that physical location has no importance. They can even move to Dubai.
Informative, good post. Unfortunately the tax is more of a political statement than a tax generating thing
I have already seen small tax laws that were introduced. Small taxes are easier to pass into laws, less resistance because of the low taxation level. Once introduced they can raise the tax without anybody noticing it. And then it becomes what it was meant for: a tax generating lots of money. Same story for "temporary" taxes. In no time they become "permanent" taxes.
See what Larry Summers said at the end of the video. The last question asked by the reporter is about new taxes. I give him a thumb up.