Immediate Action Useful: Talk to Erin Burnett

Discussion in 'Wall St. News' started by seasideheights, Sep 2, 2009.

  1. The Trader Tax story as shown on cnbc. Everyone said the tax was really small. That small tax will put traders, including YOU, out of business.

    Erin Burnett calls it a "tantalizing idea". She wants to use it for deficit reduction. Email Erin Burnett.

    "If you want to buy at 1:00 and sell at 1:30 that would be deterred" - Dean Baker


    Remember: 1/10th of 1% transaction tax means an $80 tax on a 1000 share roundtrip of QQQQ.
  2. FB123


    Sent her another one from a different email address - it can't hurt, she's not that bright. Better drive it home.
  3. pspr


  4. cstfx


    Sent to CNBC (and that idiot twit) today:

    From: xxxxxxxxxxxxxxxxxxx
    Sent: Wednesday, September 02, 2009 7:17 PM
    To: ''
    Cc: ''; ''; ''; ''; ''; ''; ''
    Subject: Attn Erin Burnett re: Transaction Tax

    [I want to share this with ALL the CNBC programs as it applies to all of you since this does not seem to be a priority in discussing what may come to pass and how it would affect segments of this country, including various media outlets]

    The piece you aired today on Street Signs with your implicit approval for some type of transactional tax is misguided and misinformed (some would call this being ignorant).

    Why would the transaction tax be detrimental to the domestic financial markets?

    Where would I begin?

    First - a tax of "as little as .1%" on every stock transaction would dramatically increase the costs of buying and selling of stocks. Since neither you nor your guests have thought this through, let's do some math: you purchase 100 shares of GS at 150. Commission would generally cost the average investor/trader $5-7 to enter and then exit this trade. With a transactional tax, you now have to add in the cost of this tax which is based on the VALUE of the transaction. .001*100*150 = $15 for each side. You have now effectively tripled the price of buying this stock.

    Second - Traders are already taxed for their profits (called capital gains tax) at some of the highest rates in the world. This new tax would be levied on trades whether or not they are winning trades or losing trades and this would be on top of the already higher capital gains taxes that will become effective when current tax laws sunset.

    Third - you put forth that there already is a similar tax in Great Britain so what's the big deal. This tax, while supposedly applied to all, allows exempt entities to avoid paying such taxes on these transactions. Exempt entities are exchange members and other financial services members. The tax is carried primarily on the backs of the small trader/investor who does not have the advantages of these exempt members. Proponents of this current incarnation of this tax would use it to punish the big banks who would reap what they feel are excessive profits while the country is in disarray. If you could use the FSA tax as an example to domestic implementation, firms such s Goldman and Morgan and the like would find a way to be exempt from this tax and it would be solely on the backs of the individual, E*Trade/Schwaab/Scottrade/Interactive Brokers trader, your audience!!!

    Fourth - The argument that the government would reap massive new tax revenues (revenues that the AFL/CIO union proposes should be spent on NEW government programs not debt reductions) is a flawed argument. Mr Baker estimates that there would be 100B USD new taxes if implemented today. This is only if all things remain equal, but a new tax such as this, which as titled, would limit volatility in the markets, would in effect limit the number of shares traded every day, thus decreasing the tax estimates that Mr Baker salivates over. Trading in securities would move overseas where costs are less. As it is right now, there are many dual listed securities on the NY exchanges and on the Toronto exchanges. Brokerages are increasing their presence in Toronto and other areas of the world and would be not that difficult to switch venues should such a tax be instituted, thus depriving the government and persons such as Mr Baker the joy and benefit of reaping such new revenues.

    Fifth - The impact of this tax would be felt across the entire financial industry including those areas not directly associated with the industry. It is estimated that there would be 100s of thousands of people affected, not just the 200,000+ who work directly in the industry. From programmers, to software vendors, to computer sales, to legal, to the deli owner, shoe shine guy, barber (etc) many, many people would lose their jobs as a result of the decreased activity that would result from a transaction tax being instituted. Certain voices in this nation who suddenly feel empowered after so many years in the wilderness don't care for such arguments and those people who would lose their jobs, as more than likely don't carry a union card. Among those who would be looking for employment would be the staff of CNBC because without the individual trader, you would have no audience. (To paraphrase William Holden, you should be MAD AS HELL AND YOU WON'T TAKE IT ANYMORE if something like this gains momentum and threatens your job and professional existence. Where is the outrage?) Not everyone (anyone?) will move over to your national sisters and be assured of job security.

    This tax proposal has been bandied about for about a decade now constantly being re-introduced by Rep DeFazio. It first came to light after the implosion. Where many people, Mr DeFazio included I am sure, lost much money dabbling in the market. "Let's blame the speculators and the day traders!" Every time his proposal gets shelved. And every year he reintroduces it. Larry Summers commented on a tax more than a decade ago and he felt that it was a good idea. A decade ago, stocks were quoted in 1/8's and 1/16's. A small transaction tax would probably not be felt due to the spread already built into the costs of doing business already in existence. But since that time, the markets have become more efficient and stocks are now quotes in pennies with the average spread of .01-.02. Even Mr Summers now realizes that such a transaction tax if implemented, would have a significant detrimental effect on the financial markets and no longer supports such a move.

    There has been such little discussion about this on your programs and I believe that would be a mistake. In the current political environment, there are those who seek to create a "it's their fault" or an "us against them" mentality and foist it on the general public. They want to get the populace all riled up and march not just on AIG headquarters but the headquarters (and possibly executives private homes) of all those firms that those in power deem undesirables. And yet we don't hear barely a peep out of the financial talking heads about this issue. Instead, you tell your guests to shout at each other and talk all over each other and nothing of significance is discussed in a rational and coherent manner. Which is a shame because if this or a similar tax is instituted, CNBC will cease to exist and your staff will join the other thousands of people affected buy this tax and be without a job.

    I am an individual trader who would be destroyed if this or a similar tax were instituted. I am barely one of those "share the wealth" individuals that this current administration would wish to exploit but am by no means rich beyond my wildest dreams. Living in the NY metropolitan area qualifies me as middle class, not rich, but yet others would rather paint me as such. If such a tax became law, it would effecively drive me, and people like me whose livelihood is derived from the daily buying and selling of stocks and other such instruments, out of business and unemployed and dare I say living off the government dime. This tax is BAD! As financial reporters (sorry, journalists) you should know this too!


  5. FB123


    Nice post. Hopefully they will get it and will start to actually use whatever little brainpower they have to try to kill this stupid idea instead of promoting it on their network.
  6. CNBC is insane to let Erin Burnett (or anyone else they let come on) sit there and say what a great thing this tax would be. The tax would absolutely KILL a good chunk of their sponsors - Ameritrade, ETrade, Scottrade, IB... And what traders would there be left to watch Fast Money, Cramer, etc?
  7. You guys are really gay, who gives flying fuck about Erin Burnett.

    When she does a hustler cover, let me know.

  8. That would be useful as well.

    The issue with Erin Burnett is that she becomes advocates of certain positions & discusses them not just on cnbc, but on msnbc, the today show, and meet the press. The non-trader audience on those other shows may actually LIKE the idea of this tax & start calling their own representatives in an effort to push it thru. We need to explain to Ms. Burnett, who has already said she's going to continue with this story, just how dramatic the ramafications to the tax, while seemingly small, will be, BEFORE she continues advertising the idea.
  9. Can't stand Erin Burnett or her nonstop "silver lining" and "green shoots" drivel.
  10. [​IMG]



    I think the last one is fake. :p
    #10     Sep 2, 2009