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Tax on Trades Should Be Part of Rescue Plan, Some Democrats Say

  1. In a letter sent late yesterday to House Speaker Nancy Pelosi, 16 Democrats asked her to ensure any rescue legislation include a ``transaction tax'' on all U.S. stock trades and on other types of trades, such as credit default swaps, options and futures. They are proposing the tax would be at a rate of one quarter of one percent on all trades.

    ``The same Wall Street speculators and investors who are principally responsible for having caused this avoidable financial crisis and profited from it must now be required to pay for it, not U.S. taxpayers,'' according to the letter, which was signed by Representative Peter DeFazio, an Oregon Democrat, and Representative Pete Stark, a California Democrat.


    http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a5UhcbI4jecU
     
  2. 16 lunatics. there is no way this passes and no way the president signs it. dow 9000 if he did
     
  3. One overlooked aspect of this rescue/bailout/circlejerk is that in exchange for the $700 billion the politicians have all kinds of ammunition to do all manner of stupid things. We already see the demand for a pound of flesh.

    We probably have already written a second, shadow check for $700 billion in various government "investment" programs.
     
  4. GODDAMNED MONEY-SUCKING PRICKS AND BITCHES.

    I won't say what I really think of politicians siffing around for how to pay for THEIR games.
     
  5. So, what's the dollar amount on ES? The margin or the total contract value? :confused:
     
  6. What the Fuck do traders have to do with the mortgage problem. Do they really believe banks make all their money off of "transactions." Under this proposal I would be paying $12,000 a day in taxes.
     
  7. In a letter sent late yesterday to House Speaker Nancy Pelosi, 16 Democrats asked her to ensure any rescue legislation include a ``transaction tax'' on all U.S. stock trades and on other types of trades, such as credit default swaps, options and futures. They are proposing the tax would be at a rate of one quarter of one percent on all trades.

    I guess the tax would be on both buy and sell transactions?

    What is this world coming to?
     
  8. SEND THE URL OF THE STORY TO YOUR BROKER!!
     
  9. Why don't they just tax us EVIL shortsellers? I do not like taxes any better than anyone else, but as a shortseller, I would like for shorts to everything back on the table.
     
  10. I am not surprised by this. Create a crisis, then tax your way out of it. Damn, it's like Hussein is already in the White House!
     
  11. Clearly this would include ETF trades, but what about mutual fund trades? money market fund trades?

    I just finished eating lunch (I'm on the West Coast). Excuse me, I have to go throw up now....:mad:
     
  12. In Britain there is 0.5% on stock purchases but not ETF, futures or options. People spreadbet and trade contracts for differences which are not taxed.
     
  13. There's no fucking way this could happen...

    is there?
     
  14. This would indeed put us all out of business. Would cost me 10-15k per day and I'm not even a high volume trader.

    Liquidity would be GONE.

    Worst idea in the history of ideas.
     
  15. Wouldn't surprise me if the only knowledge of what "ES" means came to Pelosi through an intern...
     
  16. Surely a 25BP tax on all transactions would kill arbitrage and pretty much kill the derivatives markets in the US. Wouldn't it cause a bigger problem than the one they're trying to fix?
     
  17. SEND THE URL OF THE STORY TO YOUR BROKER SO THEY CAN FIGHT IT.
     
  18. no. I dont think even obama would sign this. buffett would surely tell him this is just awful
     
  19. Yes. it's all my fault, I should pay for it.

    Put me out of business while Paulson keeps his 600 million, or whatever he got from GS.

    Bastards.
     
  20. What a surprise. Democrats want to raise taxes. Hell, why not make it 1.00%? Or 5%? Think of the revenue that would raise, since in their world taxes don't affect people's conduct.
     
  21. So if liquidity providers have to pay a .25% transaction on every trade, doesn't this mean that all bid/offer spreads will have to be at least 0.5% wide just so the market maker can make enough profit to pay the taxes?
     
  22. the scary part is the statement in paragraph three:

    "speculators and investors who are principally responsible

    for having caused this avoidable financial crisis"

    OMG .....where do you start??....they cant all be that

    clueless...OMG
     
  23. Yes, they can be that ignorant. Gentlemen, these people don't read their own legislation. They only read summaries, written by someone else. And that statement above is a gross, poorly-aimed, summarized, sweeping generalization of investors and traders.

    If the people had any power at all to fire these jerks, we could be as general and proclaim that all politicians are swindlers who steal from taxpayers and shit on them when they ask questions.
     
  24. It would put all day traders out of business.
     
  25. SEND THE URL OF THE STORY TO YOUR BROKER SO THEY CAN FIGHT IT.
     
  26. Done. Not expecting anyone to change a politician's mind, though.
     
  27. Well, if a trader is only marginally profitable, this tax would be a killer and also cripple established traders.

    Here is an example:

    A marginal trader makes one round trip, buy and sell or short and cover each trading day. The trade size is $10,000.

    The tax is $50 for the round trip, $25 in, $25 out.

    There are about 235 trading days a year. So $50 times 235 days equals a staggering $11,500 of transaction taxes for the year.

    This marginal trader is out of business...:eek:

    Is this correct or am I losing my mind?:confused:
     
  28. Guys, just because a handful of these yutzes sent a letter doesn't mean it'll find its way into the bill.

    Think of how hard it would be to implement and how much delay it would add to the bill's signing. For those 2 reasons, it won't make it in.
     
  29. Good thread. Interesting development. Not to be underestimated. I wouldn't be surprised to see any series of steps taken to decrease the participation of short term, parasitic traders. Democrat's hate us. One of biggest worries is a ban on index futures trading.

    We're in de facto violation of the no-short rule. We're a also a LEVERAGED-bad attribute in 2008 lexicon-low margin trader. We're too speculative and at the end of the day we don't inventory big enough positions over night to make a strong-good for liquidity- argument.

    As we all know the NYSE closed for a couple of years at the begining of WWl. Those us us who remember the Congressional hearings after the 1987 Crash can recount the absolute assault futures and options took in the blame game targeting "program trading" and portfollio insurance." To put things in perspective for the younger guys-those afore mentioned terms were as big in the news then as the words sub-prime are now. Alan Greenspan spoke in defense of futures. He was VERY respected for his conduct the week of the crash (the market quickly recovered from it's lows) and he gave impassioned, reasoned analysis as to the valuable goal risk transferance played in October/87.
     
  30. The only way this passes is if Obama gets elected. No way McCain would ever sign this in.
     

  31. That doesn't mean we shouldn't have our brokers yell about it now. There's no reason they couldn't implement that next month, next year, etc.

    Send the URL of the story to your broker so they can give some pushback to that idea before it spreads.
     
  32. You are not losing your mind. I trade relatively average volume for a retail trader and I had 420 million in sales on my 1099 last year. Add in the buys, and I would be paying a 2.1 million dollar tax bill.
     
  33. This should, once and for all, cut the bullshit on this board about how Democrats only want to raise taxes for the rich (Who am I kidding? It won't).
    Hell make it 5% and no more 1040 capital loss deductions.
     
  34. Right. If Obama is elected, I'm just praying he'll pull a Bill Clinton and lean to the Center on economic issues. But nothing he has said or proposed so far gives me hope.

    Is he man enough to stand up to the Pelosis and Boxers?

     
  35. Lol, worst plan ever. Watch every futures exchange locate outside the USA if this ever passes.

    Those 16 morons just committed political suicide.
     
  36. Why would a politican from Chicago sign a bill that would put the Merc and the Board out of business?
     
  37. it's a total anti-liquidity proposal
     
  38. 1. Taxpayers forget the wrongs of leaders who proposed legislation that didn't pass. Rabid democratic voters vote that way out of determination, not logic.
    2. Politicians bring back such legislation and pass it in the middle of the night. The key is to even consider it in the first place. Done.
    3. I will be trading those foreign futures exchanges, wherever they are, if America does for futures traders what it did for living-wage factory jobs.
     
  39. Big drag on non institutional trading volume. This tax created the CFD market and reduced stock trading further. Now that IDIOT Brown, the Sub Prime Minister is talking about permanent anti shorting legislation to shift the blame from his creation of false prosperity that is now collapsing.

    UK is OFF my radar screen because of this tax.
     
  40. This would not only finish trading equities and bonds....

    This would finish equities and bonds being in the US....
    ...................................................

    I have mentioned many times that legal largesse is one of the main problems in the US....

    This type of legal largesse would domicile the exchanges in Hong Kong, Dubai, and elsewhere....

    .................................................

    Quite frankly, if it were cheaper for me to list on other exchanges , why would I not ?

    The US is going to refuse my companies creating jobs on US soil?

    ................................................

    Quite frankly, it is possible that the exchanges would be better for traders and everybody else.....

    If they were domiciled somewhere else....

    Especially when somewhere else means more efficiency ....
    ....................................................

    Look computer banks could be anywhere....

    What trader cares where the computers are ?

    And what trader would want to trade in the US, if they can trade elsewhere without the Patriot Act and the long list of bullshit that just hampers good efficient trading ?

    ...............................................

    What would make sense is to have a worldwide 24/7 internet exchange line where one can trade all stocks, bonds, currencies worldwide.....

    Housed away from legal largesse US bullshit....
    .....................................

    Think not ...?

    Look at what BATS has done in such a short period of time.......

    Now think about a consortium of BATS in efficient and willing jurisdictions.....

    Would one not just love a single efficient highway for all of it....????

    Any stock, any bond, any currency, or conversion thereof.....

    Done with the BATS model, with the least middlemen/legal largesse possible.....

    Computer banks do not care where they are....nor do traders.....

    F the idiots and let them swim in their idiocy......

    The 24/7 should be a Globalized....never interfered with ....capitalistic entity.....

    Go Hong Kong !!!!!!
     
  41. man...this is just sounds retarded..how investors can be responsible for this mess? they are those savvy folks,who just got raped in ass on those financial stocks,bonds etf-you name it. they all screwed and now they are responsible for whole crisis. those white house idiots are in f*n fantasy land..this is just insane statements they are making.
    and on how many levels i need to be taxed in US? where is the end of it?
     
  42. This is totally insane.

    For the first time, I am really starting to
    worry about the future of the US.

    Nancy Pelosi and friends will destroy
    the US and the $.
     
  43. you will be taxed till you screech with pain. and then taxed some more...

    :(
     
  44. i dont think anyone's ever claimed that the Merc was responsible for any of this, or that they would get any of the bailout

    but this provision would take them out completely

    hopefully, they will jump right on this
     
  45. SEND THE URL OF THE STORY TO YOUR BROKER SO THEY CAN FIGHT IT.
     
  46. and they'll tax the pain

    and tax the screeching
     
  47. Worse case, almost impossible scenario: it happens. Unlikely, but more ridiculous legislation has been passed in this country. If that happens...

    1. Trade the DAX, the Nikkei, the Hang Seng, or any number of other non-US futures products;
    2. Trade American futures in an IRA.

    If 1 or 2 do not work/are not feasible, find a new career as a politician!
     

  48. Circlejerk. The best description I've heard yet.
     
  49. this is why anyone who votes for the democratic party is an idiot

    I disagree with republicans, but less so

    ron paul should just make a new party and I would vote for party 3
     

  50. :D

    :(
     
  51. LOL Ya gotta love the stupidity of it all.... PDT "rules" to protect the "little" guys (from themselves) from playing the game cuz they are not smart enough, or they don't have enough money, or they don't know what the hell they are doing. Oh, and of course to eliminate market volitility caused by all the daytraders, we bad.

    Followed by the advice of, " let the "professionals" help you to invest your money, they know what they are doing, they are better suited to manage risk." (cough cough)

    Then along comes the GREAT idea to let John Q Public manage their own SS funds.

    Then the fall out from the CDS created by the MBA masterminds (those professionals, remember?), who lent too much money to overextended John Q's who was presumably not smart enough to handle his own money, but hey give him a bunch of money for a nice house..... WHY oh WHY didn't I let LEH or BS or some of those OTHER, professional, more able people take care of my money????

    And now tax trades? (and of course the profits from those trades, should there be any) Money for NOTHING..........

    Tweedle Dee and Tweedle Dummer..........
     
  52. I calculate that an ES contract based on roughly $60,000 would be $150 each way

    $300 divided by the current transaction expense of 5 dollars means transaction expense increased by a factor of 60 times
     
  53. SEND THE URL OF THE STORY TO YOUR BROKER SO THEY CAN FIGHT IT.
     
  54. I suspect it wouldn't apply to futures but you can't under estimate the stupidity of Washington. If this were attached to the bill the market would cease to exist. It will never fly.

    Let's do a little math. 1000 shares of AAPL at today's close is $263,860 (both ways) of stock value * .0025 = a tax of $659.65. The day trader would never be able to offset the tax with profits and the buy and hoper will only try this once.

    If Washington is stupid enough to pass this part of the bill it will quickly be repealed. Rest well tonight traders. It ain't happening.

     
  55. it is not a big deal.

    all trading will move to dubai - they try to attract as much trading as possible anyway.
    us will lose hundred thousands of jobs in finance, i.e. huge tax revenues. new york will become vacated - the house prices will go lower.
    nobody will lend america anymore so dollar will go lower, inflation higher.
    chavez will send all oil to china so gasoline will be over $10 - maybe higher because government will start to tax it the same way europe does.
    smart people will stop coming to america because they will not get paid enough and big brother will listen to their every f#cking phone call. the best high profile jobs will consequently leave us. the unemployment could be 20% but it will likely be only around 15% because mexicans will flee back to mexico - so there will be plenty of dish-washing opportunities.

    god bless america
     
  56. Exactly! Perhaps someone should call Washington and tell them what a wonderful plan this would be while I call an Asian Broker to open my account. LOL. What a super idea! "New York would be vacated." Ain't that the truth. What a death blow to America this would be.

     
  57. So for every 400 shares traded the government gets to own one share. Speaking of nationalization...
     
  58. Here's the worrisome part about this bill though. Someone will explain what a mess this will cause and the light bulb will come on and they will get the customary reponse of, "Oh." A second or two after that it will get followed up with, "Well, why don't we just tax them bastards a flat fee of..."

    We're gonna pay something. All you elitetraders who sold anything short this past year are all screwed. You bastards should have known better

    :mad:
     
  59. They already tax the shit out of trades....some of us have paid in hundreds of thousands of dollars over the years, perhaps this has already been pointed out!
     
  60. If this happens, I'm done - out

    i cant get over a 300 dollar hurdle
     
  61. SEND THE URL OF THE STORY TO YOUR BROKER SO THEY CAN FIGHT IT
     
  62. You, me, and thousands of other traders.

    Wouldn't the mkts cease to exist?

    ( I sent my broker the URL!)
     
  63. as a former tech worker smashed by H-1b visa, I can defiinately see them doing it - h-1b was so far beyond my worst nightmare

    i really feel cursed - no matter what i go into, the government seems to declare war on it

    how do you 'rescue' wall street, by putting all traders out of business, including those innocent in all of this?
     
  64. Ain't that the truth. Bastards.

     
  65. This guy is a total douche-bag.

    Representative Pete Stark from California's 13th District. His name is on this proposal.

    http://www.house.gov/stark/
     
  66. DeFazio. What a Clown.

    "Speculators" caused this?

    No, dumb fuck.

    1% Fed Funds caused this. And useless Politicians (like you) who were either too stupid, or too corrupt to realize 65 Trillion in derivatives and Fed ownership in the same hands (Wallstreet), is a bad fucking idea.

    Its called Moral Hazard, you Douche Bag
     
  67. These self-serving, dirt-stupid Politicians will be the death of this Country.

    They grin and spread lies all day to butter their own bread.

    What a load of cocksucking Motherless Whores.

    Fuck it makes me ANGRY
     
  68. destroy democrats as a political party.wipe them out utterly
     
  69. That'll teach you guy's to elect an athiest Dem......:D

    Wags in many ways you're more a SoCal kind of guy, eh?
     
  70. DeFazio's contact info:

    http://www.defazio.house.gov/index.php?option=com_content&task=view&id=127&Itemid=74
     
  71. I'm against anyone in political office that has never taken a basic Econ. 101A class.
    And unfortunately, that means just about everyone in the House and Senate.

    :(
     
  72. Quit holding back and tell us how you REALLY feel, a28! :D

    I'm with you. This is some scary shit. It would really f*ck us traders. :mad:
     
  73. oh man, this is baddddd news

    Look at all the kinds of bullshit they are pulling, first the short sale ban (even on stocks like IBM ?!) and now this.. And the market has only fallen approx. 20%, the real economy hasn't even contracted yet!

    Can you imagine the crazy shit they are going to do when things really start to get hairy? Man I have no idea but it's not going to be good for anybody who's profession is even remotely associated with wall street.

    heaven help us
     
  74. It's like the whole country. Free market capitalism should be REQUIRED lessons. Of course it would never fly with one of the chapters being "Why School Choice Delivers More For Less".........
     
  75. So, if it did happen, when would it take effect? The day the bill is passed? Do we need to look this legislation over as soon as it is passed? How do they normally start new taxes on things, it's normally the new tax year, right?
     
  76. Punish all for the actions of a few. Enact new laws because the old ones aren't enforced. Etc... These fuckers have been in DC way to long. Totally out of touch. We need an end to career politics. Sure would be nice to see a turnover. 535 would be about right.
     
  77. No no you don't understand. It will just magically be enacted overnight, kind of like banning short selling!
     
  78. And these are the people we expect to make a good decision on a $700B bailout bill?
     
  79. So, you're saying it would all be collected from the broker. That's fine, at least I'd know about it then. If it's something I'd have to put on my tax return, I'd hate to get that surprise, if it was retroactive, well, then I guess I'd just be bankrupt.

    ETA: I don't mean it's fine, I just mean I wouldn't be screwed without knowing.
     
  80. well, if they mean with 0,25% the whole worth of a futures contract, then yes, it's alot. a $5 roundturn is less then 0,01% of a future contract worth $70000

    a 0.25% tax will make roundturn 25x more expensive, making it around $125. That would probably kill futures daytrading.
     
  81. and they'll make it retroactive for 10 years
     
  82. I agree, I trade some markets outside the US but the UK isnt even on my radar due to the tax.
     
  83. china cuts taxes on stock trading but america imposes it, this is like a communist CUNTry
     
  84. Tax his land, tax his wage,
    Tax his bed in which he lays.
    Tax his tractor, tax his mule,
    Teach him taxes is the rule.



    Tax his cow, tax his goat,
    Tax his pants, tax his coat.
    Tax his ties, tax his shirts,
    Tax his work, tax his dirt.



    Tax his tobacco, tax his drink,
    Tax him if he tries to think.
    Tax his booze, tax his beers,
    If he cries, tax his tears.



    Tax his bills, tax his gas,
    Tax his notes, tax his cash.
    Tax him good and let him know
    That after taxes, he has no dough.



    If he hollers, tax him more,
    Tax him until he's good and sore.
    Tax his coffin, tax his grave,
    Tax the sod in which he lays.



    Put these words upon his tomb,
    "Taxes drove me to my doom!"
    And when he's gone, we won't relax,
    We'll still be after the inheritance TAX
     
  85. How dare they ask the financial industry to pay for a portion of the bailout of the financial industry. A bailout caused by the recklessness of the financial industry. I'm outraged.

    The burden of this bailout should not fall on any portion of the financial industry but rather fall entirely on middle America.
     
  86. Ummm, certainly the retail brokerages and the exchanges had nothing to do with the current fiasco. So I think your argument is pretty dumb.
     
  87. If US does this, then rest of the world will follow. why not? it's free money for the gov't...hooray!!!
     
  88. you know, Im getting so tired of this relentless assault on the Free Market.

    Every mindless idiot I hear jabbering on talk radio or converse with on the street, parrot the same ordained mantra " yea, damn those short sellers! They're *manipulators*! WE need that bailout or the economy is done for!"

    These people are Pedigreed Retards who couldn't muster a critical thought or original opinion if they took a 4 year fucking degree in it!

    I want this Market to fail.

    I want to see these fucking idiots work for a God Damned living.

    The Market is not a Toy. You were stupid. You lost all your Money.

    Sincerely,

    DJIA @ 7000


    Thats my idea of a happy ending.
     
  89. ok, now this is just going too far
     
  90. CME futures trades DID NOT cause this

    the S & P is down 25%, and they're dropping the curtain of a dictatorship

    nuts
     
  91. That's right.

    Makes perfect sense to TAX "investors and speculators" who traded stocks, bonds, futures, etc. on EXCHANGES REGULATED BY THE SEC and CFTC!

    Congratulations.
    Another moron introduces himself to ET.

    :(
     
  92. Just sent Bob Pisani, Maria Bartiromo, John Harwood, and Mark Haines an e-mail and link to this proposal as reported by Bloomberg News.

    Also called Representative Stark and DeFazio's office "blasting" the poor soul who picked up the phone.
     
  93. :D :D :D :D :D
     
  94. CNBC jump on the "evil short sellers" bandwagon themselves. If i hear that moron Erin Burnett one more time say it's "unpatriotic" to short, im going to need a new tv.
     
  95. Do you think it is time that we imposed term limits for members of the House and Senate, like we do with the President?
     
  96. :D
     

  97. <object width="425" height="344"><param name="movie" value="http://www.youtube.com/v/oHqUipinDyw&hl=en&fs=1"></param><param name="allowFullScreen" value="true"></param><embed src="http://www.youtube.com/v/oHqUipinDyw&hl=en&fs=1" type="application/x-shockwave-flash" allowfullscreen="true" width="425" height="344"></embed></object>
     
  98. So let me get this straight. If I buy 100 shares of apple for 130 per share thats 13,000 and then I sell the 100 shares for 131 a share I make a profit of $100 and I have to pay taxes on the buy and sell of

    $13000 * .0025 = $32.50 and $13100*.0025 = $32.75 for a grand total of $32.5 + $32.75 = $62.25 in tax and if I use a regular broker that charges 10 bucks a trade then thats another 20 dollars gone so I have

    $100 - $62.25 - $20(broker) = $17.75? Is this assclown an idiot, has he ever bought and sold a stock?

    On the otherhand I buy an aapl 165 call option for $60 and I sell it for $167 I pay the following:

    60*.0025 = $.15
    167*.0025 = $.42

    So in this case my profit is 167 - 60 - .57 = $106.43 so why would anyone ever want to purchase stock again??

    Completely retarded tax proposal, I would love to know who those idiot demoncrats are so that they can be LITERALLY thrown out of washington!!
     
  99. LOL this is fucking ridiculous!

    WHAT about EURODOLLAR futures?
    US Bonds ? (Futures) ???

    No matter what, banks would be exempt, for sure !!!

    In the end private traders would end up paying, not banks.

    FIGHT THIS INCREDIBLE BS!!!
     
  100. So two wrongs make a right?

    Grow up, already, and act like a PROFESSIONAL.
     
  101. This is what I wrote to this imbecile. To write in you need an Oregon zip code and address... I just used Mr. DeFazio's own address.

    Eugene Office
    151 West 7th, Suite 400
    Eugene, OR 97401
    Phone: (541) 465-6732

    Below is the email I sent

    "I hope you understand the absolute chaos and destruction this "transition tax" would cause. I am usually a very calm and eloquent individual, but Mr. DeFazio, this is one of the most moronic proposals I have ever seen. I have been involved in finance for 23 years and you have NO IDEA the destruction you will cause. If you think the crisis we are in is bad now, watch what happens if this idiotic tax gets passed, I guarantee it will be the end of free markets in North America, and the end of America's economy. To be frank, sir, you have no idea what you are doing here, and it is best to leave it alone, unless you want to be responsible for the utter collapse of the financial markets."
     
  102. Are you kidding, it's about time people started raising hell, the country is going to hell in a handbasket, fuck professionalism
     
  103. i dissagree

    i've called congress a lot over immigration, you lose your cool, and you give them an excuse to 'file 13' your contact with them and paint your side as nutjobs
     



  104. Doesn't this bitch know traders already pay a tax/transaction?

    it's called SEC fees
     
  105. Guys, it is VERY important that we ALL call and email this twit!
     
  106. The current little blip we are in now would be nothing compared to what this fools proposal would do. History books would call it the Defazio depression. IMHO volumes would drop more than 75% if this twat gets his way.
     
  107. Yes.
     
  108. Cayman Islands for starters, if that gets to be more than I can handle then it's off to Andorra.... same goes if Obama gets elected and raises capital gains to 40%.
     
  109. Where are all of the libs on this board? Weigh in please.........

    Support your Democrats.
     
  110. Really hope ALL of you are calling and emailing your opinions to this idiot. If you're not, then clearly you're not making a living trading.
     
  111. This won't happen, by the way. No Replican would vote for it and a lot of Dems most likely would not like it either. These guys are bought and paid for by Wall Street. Both sides. This would kill WS and the finance industry in the US. If enacted, the market would drop another 50% and any congressmen that supported it would be toast.
     
  112. Just think how screwed I'd be. I've been a full time, self employed trader for 21 years now. Who the hell would hire someone who has been self employed for almost his entire career? I have several degrees, but they were a long time ago. I could retire, but I'd have to go to a third World country to do it with the funds I have stashed away.

    I would be soooo fucked.
     
  113. This does not compute.

    MSFT/INTC employee has nothing to do with wallstreet.
     
  114. Logic has no place in a Democrat's though process (most Republicans as well).

    For them it is all about stoping capitalism. At the end of the day, they absolutely despise capitalism and people who benefit from capitalism (except themselves of course).
     
  115. they forgot last thing to complete this proposal.in addition to current PDT rules this tax should be applied only to individuals and retail accounts.
    those little retail guys (like you and me)are responsible for this mess.
    yeah..we are financial terrorists now. wait for FBI @ your door, when next time you short AIG. :D :D :D
     
  116. Hey Obama lovers, where are you now?


    Speak up!


    edit: actually obama would probably even laugh at this but its still a dem proposal.
     
  117. Conservative Democrat/Liberal Republican voting, card-carrying undecided here would like to point out to all of those who have their undies in a bundle that this silly idea was proposed by a handful of Democrats.

    A handful. 16 out of well over 200.

    No senators, as far as I know.

    Yes, it is a silly idea, on par with the conservative Republican idea to pay for the $700 billion by eliminating capital gains taxes. Maybe even worse.

    I resent extremism from either side. The Daily Kos'ers and the Michelle Malkinites are ruining this country by their insultingly simplistic solutions to admittedly difficult problems.

    I trust that the moderate wings of both parties (people like Warner,, Specter, Baucus, and Bayh) will put their heads together and put forth something reasonable.
     
  118. +1
     
  119. I kept my letter short and sweet. (Had to pretend I was from Oregon to have the email go through.) :)

    "Can you give me one shred of evidence that speculators and investors are principally responsible for causing the financial crisis?"
     
  120. Make sure you call as well... I just can't believe how idiotic this government is
     
  121. Investors happily bought this shit as long as it had AAA painted on it. The investors should have said, black box model for 0.5% more? FUCK YOU.
     
  122. This government is just an extension of the electorate. But yes, it's very idiotic.
     
  123. 1. Register an IBC on the British Virgin Islands.
    2. Move out of the country
    3. Pay yourself a 70k annual tax exempt salary.
    4. Set up some accounts through your corporation for personal living expenses.
    5. Use your corporation to compound capital free from capital gains taxes.
     
  124. I realize we're dealing with idiots here, but please be cordial if you contact these guys. Otherwise it will fall on deaf ears.
     
  125. In all seriousness, wouldn't wall street be completely dead if something like this were to happen.

    No trades, no liquidity, mom and pop would be paying 3 percent spreads on their 100 share order.

    C'mon guys, this isn't even possible.




    BUT, the scary thing is, I could see the gummit tacking on some kind of extra fee on trades similar to sec fees. Something really small to the avg investor but also something that would be felt by the pro trader.
     
  126. jayford, dont sweat it bro........ your golden
     
  127. If they have already done this in Gr Britain, why wouldn't they do it here? What effect did it have on London's stock market?
     
  128. Agree 100%.

    The Government wants us to take everything sitting down.

    Be "reasonable", they say.

    My answer to that: Fuck You.

    Enough is enough.

    Douche Bags.
     
  129. Too early to tell IMO.

    China has tried it for a longer period, though, and saw prices and volume plummet. Now they're re-instituting it.

    http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a8gUqAR2Smak

    I didn't think I'd ever say this, but...let's learn a lesson about the free markets from Red China.


     
  130. ES contract value @ 1200 = $60,000

    0.25% of 60k = $150

    Fuck that.
     
  131. Exactly. Liquidty would be GONE!
     
  132. Here is probably the main point you want to make when writing these FUCKING IDIOTS

    - Enacting an enourmously burdensome transaction tax will drive liquidity completely away from these markets. The current bank bail-out proposal is being discussed for the sole reason of no liquidity for the "toxic" paper.

    By enacting this tax, the markets will face an even larger liquidity crisis, that will spread to the commodity markets and the bond markets, making Treasury products impossible to even price; same with commodities.

    The efects will be almost immideate. Producers (such as farmers, miners, etc) will not be able to price out their products because of the lack of liquidity. We will be in store for an even newer bail-out for the same exact reason: ILLIQUIDITY.
     
  133. If you're going to write them you need to pretend you live in the member's state/district, even if sending a fax etc. Otherwise it just goes in the trash.
     
  134. IF this ever got passed (big IF because I doubt it will), my guess would be that exchange members, which are the major liquidity providers, would probably get an exemption... which would mean that you could get around it by buying or leasing an exchange membership. That would definitely increase your monthly costs if you rented, or force you to make a substantial investment to your career if you decided to purchase a membership... but it would clearly be cheaper than the alternative. However, that may be what they want since that would have the desired effect of talks some of them have been rambling on about recently, which is the repeal of the 60/40 preferential tax treatment on futures transactions, since exchange members (except for ECM's) get their profits taxed as ordinary income.

    Its quite scary to even think about... it almost makes me want to buy a GEM membership as a hedge while they're still relatively affordable.

    Of course this is all just conjecture on my part.
     
  135. what about the next president? it doesn't make a difference as they are both economic ignoramuses
     
  136. Are you saying exchange members' profits already get taxed as ordinary income, or they would be taxed this way if the 60/40 treatment was eliminated?

    If the latter, wouldn't that apply to all traders, exchange members or not?
     

  137. are you sure?

    maybe what they mean is 0.25 % of the profit?
     
  138. Correct... Currently, if you purchase or lease a membership on a futures exchange you lose the 60/40 treatment and your profits are taxed as ordinary income.

    I have previously confirmed this with Robert Green.
     
  139. Don't forget to call or send an email to your broker with the url to the story today. Getting the brokers to give some pushback will help keep this thing from seeing light of day. If it happens, most of us are finished.
     
  140. Profits are taxed already. They mean taxes on transactions.
     
  141. look at the British example
     
  142. that would more or less stop short term trading.

    the loss of liquidity then would kill markets even faster.
     
  143. Now you're seeing the real plan unfold. "They" don't want us managing our own money. "They" take over all the banks and brokerages and "they" manage the money. That's where this whole thing is going.
    They're trying to smooth this whole thing out, for themselves. No more trading by the common man. We can pick up the phone, call the government broker, buy your shares of XYZ company and wait until retirement to cash out. The market goes up a very predictable and manipulated 8%, they take their commish and all is right in the world...their world.
     
  144. My guess is that the 60/40 gift we futures traders have been getting for the last twenty five years or so is going to be a casualty. On principle, it is difficult to justify it; though when it comes to my taxes, I love it.
     
  145. Two quick rebuttals.

    1.Unless one meets the criteria of professional status making them eligible for mark to market-your carry over on losses is capped at 3k a year.
    2. If you're a long term holder of futures, i.e. if you index your holdings via ES rather than an ETF-you're then paying a higher rate on the 60/40 blend than the more applicable to your style cap gains rate.
     
  146. Has this thing been thrown out yet?
     
  147. Unfortunately I heard the CEO of Overstock.com on the radio last night commenting on the bailout; he mentioned that the transaction tax was a core component of the plan.
     
  148. The problem is the idea is floating around. They could always enact it next week or next month or next year. We have to tell our brokers about the story so they can shoot the idea down. They need to tell dc just how many common people have brokerage accounts now.
     
  149. As stated elsewhere, the idea has been raised by a group of politicians, so there is precedent. Assume it doesn't pass this time. The way politics works is to bring it up for a reaction, then pass it in the middle of the night when half of Congress is out. Have you forgotten that political expediency is about determination and not logic or reason?
     
  150. having lived through H-1b visa in tech, I can tell you this thing gives me chills

    what most Americans really, really dont understand, is that the government can single you out, and put you out of business - any time they feel like it. Doesnt matter what had come before or why. And they dont have to make your occupation illegal, all they have to do is put up so many obsticals that it's not worth the risk/reward

    and everyone will parrot the government party line after you've been screwed - People who were not doing as well as you will enjoy seeing you cut down to size. Those who were doing better than you wont want to believe it could happen to them
     
  151. Bye, Bye Elitetrader.
     
  152. Ok, let's have a discussion of options for traders, should this pass............................

    Trading foreign instruments? Would that have to be through a foreign broker?

    Would forex be effected?
     
  153. Why not? That's how we got saddled/infected with the Fed. :mad: :mad:
     
  154. Stock traders who don't have trader tax status have no 60-40 and yet have the same 3K carryover limit. This is one of the reasons I trade futures and not stocks.

    Few futures traders are long term holders.

    My point here is that I expect the 60/40 to be axed. Better that than have some transaction (actually a "sin" tax--to punish us horrible, horrible people who do not practice the buy and hold dogmatism and therefore caused the financial companies to collapse!) tax placed on us traders.
     
  155. I wrote MY Congressman in protest, and also implored him to tell Chris Cox to lift the ban on shorting.
    My analogy was "A car with no brakes can only crash".
    No short=no brakes.
    I trade futures, but no shorts for stocks affects me too.
    We're all affected by the "decisions" these people make, every day.
     
  156. I'd imagine states like New York and Illinois to oppose this considering majority of exchanges and brokers are located there, question is: how much political weight do they have.
    The idea of an "offshore" exchange is a good one, considering almost all companies operate globally - depending on one extremely volatile political environment (which the US currently is) obviously poses a significant risk. A sort of "world exchange" located in Dubai, Hong Kong or Singapore sounds terrific right now.
     
  157. they're cruising for a bruising, just begging to lose the exchange capital status, with wildman random tampering with free markets, proposing changes to rules every hour

    it adds a whole new layer of complexity to trading markets, that people arent going to put up with, for long

    the financials are going down because they stuffed their books full of GARBAGE end of story

    has nothing to do with traders
     
  158. http://www.ips-dc.org/articles/736

    10 Ways to Bail Out Wall Street (and Main Street) Without Soaking Taxpayers in Debt


    Op-Ed by Chuck Collins, Dedrick Muhammad.
    Published September 25, 2008 12:00AM



    --------------------------------------------------------------------------------

    Who says we need to borrow a trillion dollars to save Wall Street from its own excesses?


    As Congress debates the particulars of the Bush-Paulson bailout, one key question has gone largely unexplored: Who will pay for this mess?

    Lawmakers in Congress appear to have assumed that the federal government will simply borrow more money to foot the bill for the bailout. The national debt ceiling will rise to a whopping $11.3 trillion, up from $8 trillion a year ago.

    But this rush to borrowing merely shifts the bailout burden onto the backs of future taxpayers. Congress needs to change course — and develop a "pay as we go" plan that makes Wall Street pay.

    The lion's share of bailout funding should come from the high-finance gamblers and the wealthy CEOs who have so profited from our casino economy.

    Funding the Bailout: Basic Principles

    Wall Street and speculators should pay now for the mess they created.
    Instead of borrowing from the super-wealthy beneficiaries of the casino economy, we should tax them.
    Any bailout should stimulate the real economy with investments in Main Street, not just Wall Street.

    Broadening the Bailout Dollars

    The debate over the bailout has so far concentrated on the $700 billion purchase of "troubled assets" proposed by Treasury Secretary Henry Paulson. A real "bailout" would also target the troubled households of working American families. A $200 billion "Main Street Stimulus Package" could bolster the real economy and those left vulnerable by the subprime mortgage meltdown. This package should include:

    A $130 billion annual investment in renewable energy to stimulate good jobs anchored in local economies and reduce our dependency on oil.
    A $50 billion outlay to help keep people in foreclosed homes through refinancing and creating new homeownership and housing opportunities. These funds could also help those locked out of the American Dream to purchase homes through nonspeculative mortgage programs.
    A $20 billion aid package to states to address the squeeze on state and local government services that declining tax revenues are now forcing.
    A Responsible Plan to Pay for Recovery: $900 Billion in New Revenue

    Below is our 10-point program to pay for this broader bailout. This plan would generate $900 billion a year until the costs of the bailout and stimulus program are paid for.

    1. A Securities Transaction Tax: $100 Billion
    A fair plan to pay for the bailout should include a modest financial transaction tax on the buying and selling of stock and other financial products. A penny on every $4 invested would generate $100 billion a year. Other European countries already tax stock transactions, and these transaction taxes effectively discourage speculation.

    2. A Wealth Tax Surcharge on Households with $10 Million: $300 billion
    Congress should institute a modest wealth tax surcharge on households with a net worth of more than $10 million. These households currently own and control more than 20 percent of the nation's private wealth. They have realized huge gains from the manipulation of capital markets and the asset bubbles that created the current crisis. A modest surcharge —- no more than 3 percent — could generate more than $300 billion.

    3. A Corporate Minimum Income Tax: $60 Billion
    In August, the Government Accountability Office reported that two-thirds of U.S. corporations paid no income taxes between 1998 and 2005. These corporations paid nothing toward our shared expenses of defense, environmental protection, public health and education. Ordinary taxpayers should not be left holding this bag. A minimum corporate income tax should contribute toward the bailout.

    4. A "Disgorgement" Recovery From Profligate CEOs: $40 Billion
    Until several weeks ago, top CEOs and managers were collecting massive salaries and fees while they told the rest of us that "everything is fine." These CEOs gorged themselves and have taken the money and run. The four biggest investment banks on Wall Street shelled out $30 billion in bonuses last year. One of them, Lehman Brothers, has just gone under. Another, Bear Stearns, was bailed out earlier this year. To help pay for recovery, the new Treasury authority should seek the payback of executive compensation inappropriately extracted in the years before the Wall Street meltdown.

    5. An Income Tax Surcharge on Incomes Over $5 Million: $105 Billion
    A portion of the bailout cost should be financed with an emergency income tax surcharge on incomes over $5 million. Wealthy investors have been the big winners in the unregulated bubble economy. They have watched their incomes skyrocket over the last 25 years. Meanwhile, President George W. Bush has cut their taxes for seven years. Instituting a 50 percent tax rate on income over $5 million and a 70 percent rate on income over $10 million would generate $105 billion a year until the bailout is paid for.

    6. An End to Overseas Corporate Tax Havens: $100 Billion
    Congress should close down corporate tax havens that allow corporations to game the system and cut their taxes, sometimes to zero. This step would generate $100 billion from profitable companies that have paid no taxes over the last decade.

    7. The Elimination of Subsidies for Excessive CEO Pay: $20 Billion
    As taxpayers, we subsidize excessive CEO pay, through a host of tax loopholes, to the tune of $20 billion a year. Congress should close these loopholes, including the accounting gimmicks that permit companies to report one set of earnings to shareholders and a different, lower number to Uncle Sam.

    8. The Elimination of the Tax Preference for Capital Gains: $95 Billion
    The mega-windfalls that Wall Street executives have pocketed over recent years will be generating additional income, in the form of dividends and capital games, for years to come. Under current tax law, dividend and capital gains income faces a mere 15 percent tax rate, while income from actual work can be taxed at rates up to 35 percent. Taxing wealth and work at the same rates would generate $95 billion a year in revenue.

    9. A Progressive Inheritance Tax: $60 Billion
    In the near future, the moguls of the past quarter-century will be passing off the scene and leaving behind dynastic-size fortunes. A portion of this wealth should be taxed. A progressive estate tax on estates over $2 million -- $4 million for a couple -- could generate $60 billion a year in the short term and much more in outlying decades.

    10. The Elimination of the Mansion Subsidy: $20 Billion
    Wealthy taxpayers can currently deduct their mansion mortgage interest off their taxes. The richest 2 percent of U.S. households do not need to be subsidized by American taxpayers. Capping the home mortgage interest deduction on that portion of mortgage payments that exceeds $200,000 per year would generate $20 billion a year.
     
  159. In other words, let's just discourage productivity and wealth-building every way we can.

     
  160. These assholes sure know how to make the rich and upper-middle class relocate their money and their businesses offshore!

    Oh yeah there ya go, soak the taxpayers with more ass-pounding TAX but give debt a break. So the only way to fix this is DEBT OR TAXES? DAMN there fools deserve a reaming!
     
  161. Wow all this transaction tax talk is downright scary. I sure hope this thing doesn't have any legs. Hopefully someone comes to their senses and stops this nonsense at once. But gee the Europeon countries do it so let's follow (just like banning shorting)...

    Wake up you stupid politicians. It's not our fault. Blame the speculators, how nice...

    -Guru
     
  162. What other stock markets can you trade w/ reasonable fees? The only one I know of is Canada
     
  163. To all the people here who think that there is absolutely no chance of this or something like this happening, how can you be so sure? Look at the mood the country is in, look at how even the President went on national TV putting the blame on traders. How about if the situation gets much worse? Just because it's incredibly stupid doesn't mean the government won't do it.

    IMO we need to make our voices heard before this gains any more momentum.
     

  164. Klamath said it... stop complaining and start speaking up about this!!!
     
  165. I hope you realize that this was the title of the article, not "my title"

    I think this crystalizes the arguement between those who are free market/capitalist and those who believe socialism is the right way. By the way, I would put Bush firmly in the socialist category. Along with ALL of the Dems and a fair amount of the Republicans.
     
  166. i learned the hard way with H-1b visa, that they only believe in free markets when THEY are winning

    the moment someone else does, instant socialist, they become

    this whole bailout thing is, some of the currently wealthy made dumb bets and blew their wad, and they'll do anything to get it back

    they have political influence, and they're using it
     
  167. At the end of the day, it's about liberty and freedom. Unfortunately, this country is going away from those principles. Everyone expects the government to solve their problems. What they don't realize is that the government will ALWAYS create bigger problems in that process.
     
  168. Does anyone know what the transaction tax is in Europe?
     
  169. One more thing: Say I *am* over reacting and there is absolutely no chance of this happening. Go ahead and take a few minutes and voice your opinion, what have you lost? What's a few minutes compared to even a very small chance of losing your livelyhood?
     
  170. A few countries have it.
    .15% - .5% in most cases.

    BUT BELIEVE ME, THE OUTCOME WOULD BE: BANKS ARE EXEMPT, MM FIRMS ARE EXEMPT, LARGE FUNDS ETC ARE EXEMPT.

    SMALLER TRADERS: PAY
     
  171. Guys (and Gals), email your BROKER about this issue. They're the ones who can stand up & say I have X number of common people who would be seriously injured by this issue.

    EMAIL YOUR BROKER! It only takes 2 minutes.
     
  172. I'm not really sure why this couldn't happen. If this is how other stock markets operate and they're doing fine why couldn't this happen to the US.

    Also it really makes sense as congress is to not put the burdon on the tax payers and instead put it on wall street.

    I remember back in october of 2006 when you heard the govt was going to outlaw online poker no one thought that it would pass... it did
     
  173. Absolutely, email your brokers. IB, Tradestation etc would go out of business if this comes into play so it's in their interest as well.
     
  174. I agree completely. Let's ask Ivanovich...
     
  175. Hopefully trading foreign instruments would be enough, but they might structure it in such a way that you'd basically need to move offshore.

    The forex market would be killed off, what's 0.25% of a million bucks? But I think that's what they want. After all, those evil currency traders are screwing with the dollar as well, got to stop them right?
     
  176. Not like it really matters because liquidity would be completely dead but would Canadians have to pay this tax?
     
  177. Except I am not "Wall Street". I am a small trader...Main Street. Business will be exempt. (But will be hurt indirectly). The socialists know what they're doing, too. This tax can be sold to the thick people that votes them into office. Really, what this society spends its money on, the TV and movies it watches...it's clear we've been dumbed down for so long that it's quite easy to remove cash from us.

    And even George Bush warned us: "Fool me once, shame on — shame on you. Fool me — you can't get fooled again.

    http://www.youtube.com/watch?v=eKgPY1adc0A

    First WMD's, now Depression II.
     
  178. any here's even the worst thing...

    If you have no interest in day trading, wouldn't you want to pass this? I mean let's be honest day trading really provides no value for the economy (other than providing liquity) Now others may say that this is extremely important, which I agree it is, however if you wanted to buy a stock for the long term in Britain, I'm sure you'd be fine given their liquity.


    The more and more I think about it, is it I have no bias towards day trading, passing this makes sense to me.
     
  179. Keep those hamstrings limber, you're next to go over the barrel.
     
  180. No this hurts long term investors as well because of the extra fee, and the spreads on stocks will increase dramatically. You'll get hurt going in and out as a long term investor. It screws over everyone actually.
     
  181. Most countries don't have any transaction tax. The only country I can think of is UK which has a stamp duty.
     
  182. On that note,here's the reaction from a longer term trader on another forum I posted this to:
    I can see this thing playing well to Joe Sixpack.
     
  183. right...no value to economy...what about six figures in taxes i paid last year? wait a minute..i'm not even US citizen,because INS lost my paperwork and unable to find it for 10 years. and yeah..and i'm paying a salary to those fucks..
    what about profit from day trading,which i did'n spen at walmart,but "invest" in LEH,WaMu,GM bonds? still no value? well.. tell you what-they just make me one step closer to idea of abandon this country and move someplace else. and then- you are not going to get a single fucking penny from me anymore.
    let's see,how your credit driven capitalist economy would work then..
     

  184. Do you have any idea what this would do to Wall St? It would effectively be done. All the discount brokers would be gone. All of em. Many hedge funds would be toast, and the big firms would be banks, period. The exchanges would be a fraction of their former selves. Lots of people in the industry would be unemployed.

    BILLIONS would go overseas. The population of Dubai, which is already growing fast, would explode.

    Government revenues from the industry would plummet!

    Raising cap gains is almost as lame. Guess what happens to revenues when you raise cap gains rates? They drop. This isn't Laffer Curve theory stuff as in income tax, this is fact. Transactions drop. This was proven both last time rates were raised, and again when dropped. Obama even acknowledges this happened!

    Raising either of these taxes is lame, but the transaction tax is probably the dumbest move in the history of taxes. I do not know what the Euro taxes are, but this could be a reason why so much trading is done here, and why so many euros have accounts with IB!
     
  185. Couldn't have said it better myself
     
  186. I paid around 10K in cap gains taxes last year and this bill would definitely take me out of the stock market all together. So I guess the gov't would feel fine about losing my tax revs and all the money I add into the economy with my spending.....and for what?

    I had nothing to do with subprime mortgages and have lived beneath my means and this is how our "capitalist government" is going to reward me? I guess I should've opted for the $500,000 mcmansion rather than my modest 200K house! :confused:
     
  187. Well if you are a short term trader, most likely most of you capital gains will be offset by capital losses from another individual. So you probably don't contribute much in terms of taxes. I know it feels like you do, but in the grand scheme of things, you probably don't. If you are a long-term investor, then I take that back.

    Don't you mean a 100k house now?
    :eek:
     
  188. for this entire decade, the government has been kicking the shit out of anyone who lived beneith their means, for the benefit of those who live beyond, via actual capital loss for conservative savings through dollar depreciation and ultra low interest rates

    Now, they're pulling down the curtain of economic martial law because banks stuffed their books full of garbage causing a TWENTY FIVE PERCENT S & P CORRECTION, for the first time in 5 years, which was actually long overdue
     
  189. Jesus fucking Christ. I pay 50% of my income to the government. If you are a successful trader, you do too, unless you spend thousands to built complex entity structures. Yeah, it's half. Income tax, property tax, sales tax, gas tax, capital gains tax... No, I'm not counting the death tax.

    Now they want to dick me in my trading. Time to look at overseas futures. There is always an alternative.
     

  190. Yeah good point. I agree too
     
  191. Does anyone even know for sure if this is being debated as part of the current bailout package?

    The scary part is that if we manage to 'dodge a bullet' this time this could be enacted at anytime in the future now that the idea has been floated publicly.

    -Guru
     
  192. Yeah, this is why I don't trade the UK markets despite living here. NO ONE daytrades UK stocks, they use CFDs. The liquidity in small caps is appalling because of this tax. It raises a pittance compared to the economic costs of much wider spreads, lower volume, and lower liquidity.
     
  193. Pittance brings up a very good point. IF this lunacy passes, small cap and microcap volume will EXPLODE and I guess there would be some sort of alternate trading like CFD's
     
  194. Perhaps we should start coming up with the reasons that Mr. Joe Citizen or Random Small Business would suffer because of this bill (actually make a list we can base a letter off of) and we could send those to our lawmakers? Face it guys, they don't care about a small number of daytraders, but the implications of that go beyond that. If we could all articulate that, I think it would go further than yelling at them.

    A lot of reasons have been given already. If I have some time after market closes, I'll try to start the list if no one else has.
     
  195. Your attitude is why this stuff is allowed to even get the slightest bit of attention, let alone gain momentum and traction. Just reading the kind of "language" in that absurd proposal should make every single AMERICAN cringe in their bones.

    You need a reality check, my friend.

    I sent letters and e-mails, and called into a local talk show this morning where I highlighted De Fazio's proposal.

    Now go crawl back into your little make-believe "bubble".
    Thank you.
     
  196. 1) It's a draconian penalty, nearly 60 fold increase of transaction fee, on a group of people who
    a) didnt cause this
    b) dont benefit from the bailout
    c) in many cases, are AGAINST the bailoutm and feel just as wronged by the bailout as everyone else

    2) It will dry up liquitity - many if not most traders feel they cannot make a profit with a 60 fold increase in transaction fee - I know I cant

    3) Item 2 means it will drop tax revenues right away - this isnt the usual 'lower taxes mean higher revenues' line, common sense tells you that such a severe increase in taxes can stop nearly any activity

    4) Farm commodies prices will swing more violently, and perhaps have a larger subsidy liability - the whole point of these exchanges was to make buying and selling more smooth and liquid - thats the only point of an exchange

    5) American firms like MERC/CME etc will be out of business and become YET ANOTHER industry driven offshore

    CME/MERC has to make this case - they have people in Washinton

    It really is up to them, they need to provide a communication to Washington and any talking points that individuals need to make the case to their reps
     
  197. Unfortunately most people wouldnt know a good fill from a bad one, so they dont think this tax would impact them at all............

    Does anyone have a list of the 16 people that are in support of this thing? If so, please post it so we can get in touch with them.

    I responded to my weekly T. Boone Pickens email requesting him to call the elected officials about this too. We'll see if I get a response.

    He is having a Live chat on PickensPlan.com after the Presidential debate tonight so I will mention it on there as well. I suppose he is as good of a person as anyone to tell them that this tax is a terrible idea.

    Eric
     
  198. Did you actually read what I was reacting to?

    I doubt it--hence, your post.

    Here was my point: Yelling like an idiot at some poor putz who happened to answer the phone at your congressman's office is not going to solve anything.

    Writing letters and acting on the phone like a mature and rational citizen will do wonders.
     
  199. You could move to China - not only would it be cheaper, with fewer fat women, but you would be allowed to sell short too!
     
  200. He isn't going to have any profits to pay himself with if his transactions cost are 0.25% per trade.
     
  201. From an article on cnbc:

    In a letter to House Speaker Nancy Pelosi, Boehner urged that the House Republican proposals be "given the consideration they deserve."

    The proposals include:

    Wall Street – Not Taxpayers – Should Fund the Recovery
    Private Capital – Not Tax Dollars – Should Be Injected Into Financial Markets
    Immediate Transparency, Oversight, and Market Reform

    ....now the part about the repubs wanting "Wall Street" to pay for this mess kind of makes me nervous that some of these clowns might actually consider this ridiculous tax.....

    http://www.cnbc.com/id/26895236
     
  202. Much less liquidity for mid & small caps - wider spreads. There is a market-maker exemption so basically for small stocks you either pay a wide spread and get ass-raped by the market-making firm, or you sit on the bid for days hoping for a fill (if you don't get front-run by the MM upping his bid).

    Because of this a grey-market tax-exempt sprung up - CFDs. They don't have the tax, but the commissions are extortionate (e.g. 0.1-0.25% of face value) and they only apply to bigger stocks.

    Basically the tax really fucks over market liquidity in the smaller issues.
     
  203. I guess I am still missing it. Why would traders be penalized for what the mortgage banks who loaned the money to poor payors are solely responsible for? Deep pockets? Or is this just another money grab to tax what isn't already taxed at every stage? Mother fucking politicians...
     
  204. I thought they planned getting rid of the stamp duty?
     
  205. the WHOLE POINT of this bailout, supposedly, is LIQUIDITY

    supposedly, it's not the actual value of the mortgages, but the LIQUIDITY that requires the bailout (which is of course, bullshit, they're trying to stuff bad debt on the taxpayer)

    the net result of this proposal, is a subsidy for junk loans, and the dryup of liquidity spreading to everything

    a politisized market, where the only thing that matters is the political power of the entity/player - market skill be damned
     
  206. Wider spreads and lower volumes (along with the cost-boost via the tax) hurt everyone who uses the markets - investors pay more to get in and out, find it harder to shift size; companies pay a higher cost of capital due to less liquidity. Income from daytraders & speculators disappears, which will offset much if not all of the income tax charged on daytrading gains. Lower participation in the markets reduces tax receipts from capital gains etc.

    Basically it will probably net lose revenue, and screw the markets into the bargain.
     
  207. Lol - good luck trusting promises from politicians & governments. Surprisingly enough, they have not yet abolished this tax - and they may never do so.
     
  208. I really have hard time to understand that they(politicians) can't figure this out.
     
  209. I have an easy time figuring it out. People used to think the earth was flat - because they had never seen the whole earth or been around it, and they didn't understand any science.

    The public and politicians do not have any experience of financial markets, they have never traded professionally, and they don't understand any finance or economics. Therefore they don't have a clue what the downsides of this measure might be.

    That makes them extremely dangerous.
     
  210. I wonder what's the word at CME about this. It must be scaring shit out of them.
    Does anybody know anything about it??
     
  211. you're absolutely right. daytrading gives only liquidity.

    but if you think about it, they also give alot of taxes. think about it. daytrading is basically a zero sum game, except for dividends, and most people lose their money. price appreciation comes solely from dumping shares at the larger fool who is willing to pay more for them.
    the people who make money in daytrading, pay income taxes. but that exact money comes only out the pockets of other people who lost money, and that money has already been income taxed. so basically money won is double taxed. if the money comes from dividend, you have dividend tax. and i believe there is also company profit tax already on the money that is used for dividends.

    so basically daytrading provides a platform that creates more taxes for the government, if i'm correct about this. so if they kill daytrading, it wont necesarily create more taxes in absolute dollar value. what would change is less newbies losing money and less jobs in the financial industry and less liquidity. the first thing is probably a good thing, don't know about the second two.

    actually, the biggest enemy of the government is the buy and hold investor. they only hold, thus never pay taxes.
     
  212. there's a real easy reason for it, i learned figting h-1b visa, where they couldnt understand that it would lower wages, drive americans out of work and discourage young people from studying math and science, which has of course happened

    they couldnt understand the above, because getting big lobbying checks depended on their not understanding it

    this is an armed robbery from every family in america for a group of very rich people who havent accepted that they made a wrong bet, and it's the little guy's responsibility to make them 'whole'

    they couldnt care less about the market, once they get their hands on that loot

    the politicians, care about favilitating the robbery to get their bribes, and hopefully still getting elected, because the little guy is understandably furious - so they need a scapegoat - scapegoats, by definition, are convinient bystanders

    unfortunately, that's us

    it's like these bankers saw the burger king 'reverse pickpocketing commercial and thought 'heeeeey, what about a reverse bankrobbery?'

    the bottom line is, the American citizen is nothing but a chump to Washington. A chump to be fed on by every K street slime who walks into a congressional office with some 'sugar'. When besides the telemarketer bill, have they EVER done something for the good of the citizen in the last 15 years?
     
  213. The absoulte greed and stupidity is unbelievable.

    It's time for a revolutions, in my opinion.
     
  214. I have an account with IB, but that;s because stock transactions are usually more then double the price with an euro broker. there are almost no discount brokers here, but it is slowly changing (with IB getting strong presence here etc.)
     
  215. 6 months ago, Alex Jones warned the Ruling Establishment intended to end speculation in the United States.

    Dismissed that one out of hand. Now, it looks like it could happen.

    This doesn't add up.

    Wallstreet + Big Banks own the Treasury.

    Why would they write themselves out of a trillion dollar industry they largely control via credit issuance?
     
  216. Little or no good can come from legislation drafted through the prism of panic. Especially when tax increases are involved.
     
  217. Completely agreed, and I have been saying for about a year. Amerika is the least democratic country of all democracies. Yes I know a republic. Seriously though, we are crippled by a 2 party system. In other democracies their is power sharing through parliament. Equal representation by popular vote. Not here. Dictatorship A or B your choice. When they get a majority, as Bush did, watch out. Absolute power corrupts absolutely. I am just as fearful of an Democratic majority, no checks and balances. If we wanted really change there are a few choices

    1. Jessie Venture-Libertarian minded
    2. Ron Paul- Libertarian
    3. Ralph Nader-social program agenda with some libertarian ideals. Meaning he isn't an imperialist as the current US government has been since post WWI.

    None of the above, from what I have seen and read, is a corporate lackey like Dictator A or B.

    Post Edit: The revolution won't happen as long as ppl. can spend and watch American Idol, sad as that is. Take away their plasma tv and you will see revolution. The most important thing any person can do, which most Americans don't, is Question Authority!
     
  218. I know you didn't mean it this way, but you worded it so well to fit my point. A pure democracy is a disaster, with laws and taxes changing annually at the fashionable whim of the majority. No consistency, checks, balances or precedent whatsoever. Look at other nations that are Democracies. Take a look at the majority today... I don't want them making decisions for me. Yes, what you meant was the Democratic party, but my point is that a representative Republic is superior to a Democracy even in times like this. And to the lefties who try to pollute my country by saying over and over (thus, their mantra of determination, not logic) that America is a Democrary... learn to read, you apparently skipped history.

    From your list, Ron Paul is the only guy worth a more than dirt. Jesse has no respect for freedom of religion, and Ralph is a liberal who would lay off the whole country to save the trees.
     
  219. I completely disagree, but everyone is entitled to their own opinion, fine. I would much prefer a Parliamentary system. Why do we still have an Electoral College? It's a scam, pure and simple. The changes and whims you refer to are checks and balances. What good is impeachment if you can't even raise it like you can a no confidence vote.
     
  220. Ummm... have you seen what it takes to amend the Constitution? Its not like its any small task.
     
  221. ONLY liquidity! You obviously do not understand how crucial liquidity is for an efficient market system.

    Also, besides the taxes you mentioned, all the commodity exchanges would essentially be out of biz as day trading is 95 % of their income. Equity exchanges would all combine to one small one. Every discount broker would be toast. It would be a disaster.
     

  222. -----> well are you saying that Britain doesn't have an efficient market?


    you guys are giving ourselves (daytraders) too much credit for being an important roll in the financial mkts
     
  223. Why do we have an electoral college??

    In simple terms the founding fathers didn't think even the average white man who owned property was smart enough and knew the issues well enough to actually pick the president(the top of the social order at the time and a requirement to vote).

    They felt that voting for someone who was smart enough to study the candidates foreign relations ability and qualifications who would vote on the actual president was the best way to pick our leader.

    Currently with electoral college members committing in advance to whom they will vote for we have basically turned it into a popularity contest decided by anyone born in this country (or naturalized) with total disregard of the voters ability to understand the issues.

    Don't like what we have for people running the show in D.C.? perhaps its due to who we have deciding who runs the show.

    maybe some qualifications like owning land or having a job or something that shows that the voter is capable of doing more than drinking Milwaukee's best and watching American idol would be a start. Otherwise don't expect to do the same thing each election and expect a different result
     
  224. swtrader, thanks for the list. I'll get my email together tonight after the kids go to bed! I sent short ones, but haven't had time to get a detailed email together.

    So, ironically it's actually looking like we might be getting a capital gains tax decrease along with this bill. Who would have thought?
     
  225. Yes I understand why we have an electoral college, I am a former history major. It's was merely an attempt to point out some of the rather un-democratic things in the US.
     
  226. I know that's why it won't happen until the pain is great enough for ppl. to rise up. Right now the avg. American cares more about his favorite tv program, IMO, than foreign affairs. We don't take the time to question much of anything, we accept that our leaders know best. This is scary.

    I have friends and some family in Canada. One of the major differences hear from talking to them is that the first response is " Why are we doing this "? Not so in America. Ppl. just accept that our leaders do what's best for us.

    Never mind the millions they take in handouts and kickbacks. You probably think I don't love America, far from it, but it's depressing thinking about how different our country has strayed from the original goal of the founding fathers. These days I joke the only difference Mexico and America, is in Mexico they ask for a $20 on the road side for speeding in America they ask for a $2,500 contribution to "the party". Our corruption is simply more sophisticated than theirs.

    I cautiously optimistic that there will be some changes, however small. :p
     
  227. Avoid this site - the method sucks bigtime
     
  228. Sky, with all due respect, do you honestly think that liquidity has no benefits?

    What markets do you trade? My guess is that you trade very liquid markets.
     
  229. Of course it doesnt' have an efficient market. There is no such thing as an efficient market, only more or less efficient ones. The UK definitely has less liquidity and efficiency than the US for equivalent size stocks.

    Have you actually traded small-cap stocks in the UK? I did for several years, believe me I would have *killed* to have had a dozen daytraders in each of those stocks, and no 0.5% tax. I remember in 1996 I was up about 22% on the year, if I had been able to buy at the mid-price instead of on the offer, I would have been up 40%. That's an 18% loss of return due to wide spreads and illiquidity.
     
  230. Professional economists pretty much agree that daytraders and other short-term speculators play an important role in the markets, with respect to liquidity provision and price discovery.

    Every day I get bids and offers hit that are 1 or more ticks better than the person on the other side would have got if I were not there. When I'm exiting a trade, the person on the other side often gets a 5-10 ticks better price compared to the next bid down or offer up if I was not there. Multiply that by 250 trading days a year, 30-50 round turns per day, and you are talking 20k-60k ticks (that's about 200k-600k) saved per year by investors, just from me alone. Multiply that by what, 5000-10000 professional daytraders, plus floor traders, screen traders doing futures, algos, high-frequency hedge funds, many of them much much bigger size than me. It adds up to a LOT of money.
     
  231. HOW MANY TIMES ARE YOU GOING TO REPEAT THE SAME THING? I GOT YOU THE FIRST 10 TIMES
     
  232. It also gives price discovery i.e. making sure the price is clear and most accurately reflects the sum of all available news and information as often as possible. The more active speculators competing for profit, the more efficient the price will be on average, thus the greater the chance that an investor/hedger gets a fair price rather than an artificially high or low one.

    If a market trades by appointment and has a 10% wide bid-offer spread, any private investor buying or selling gets raped i) on the spread ii) because the price is opaque and he has no idea if news is out and reflected in the price iii) because he can't do volume without shifting the price. An active community of short-term traders in the stock means a narrow spread, a clear and more accurate price updated in seconds not minutes or hours, and more volume to be able to trade with.

    Liquidity also affects end-users of markets. Illiquid assets almost always trade at a significant discount to liquid assets. People prefer something they can cash in at close to fair value if they need to, over something that might take ages to sell, and distort the price heavily if any big volume were done. Thus illiquid shares will trade at lower valuations than liquid ones. This means companies who issue shares will now have to do so at lower valuations to compensate for the illiquidity. That makes capital more expensive, which means lower investment, lower productivity, lower employment, and lower growth. Is this worth it across the whole market economy and stock/futures markets, for a measly $100 bln? The economic effects would amount to way more than that, and the tax may actually *reduce* overall government revenue, thus not only making the tax worthless, but destructive.

    If you can't see the benefit of that, you need to study more about markets, economics, investment and their benefits. That's why the west is rich and N Korea and Cuba are poor. The richest countries have the largest number of speculators, traders, hedge funds, financiers etc. That's not a coincidence.

    Finally, there's the not inconsiderable point that it would destroy the livelihoods of hundreds of thousands of people who trade markets actively or work for institutions that rely on and facilitate that business. THis would also have major knock-on effects on the local economies of financial centres, and the USA's pre-eminence as a world financial centre. It also has serious moral implications - you are putting people and families out on the street, when they have done nothing wrong. They pay their taxes and follow the rules like anyone else, why should they get hit when they have a viable occupation? Daytraders didn't make LEH or BSC or AIG make insane gambles with 30-1 leverage, why should they get the brunt of the punishment?
     
  233. A group of House Democrats is proposing to make Wall Street companies and investors pay more of the cost of any financial rescue plan through a new tax.




    LOVE Him or hate him when was the last time bush signed a new tax into law? i think Paulson and bush our on our side this time.
     
  234. You would think that if it was a real possiblility then the stock of the New York Exchange and Nasdaq would have sold off much worst then it did the last few days.
     
  235. You could have said the same about the online poker ban. The market never saw that coming either.

    With such key issues it's important to be vigilant and pro-active. A stitch in time saves nine.
     
  236. Are you seriously a trader?

    Only amateurs and politicians blame the shortsellers for this mess.

    And professionals go long AND short.
     
  237. They are. I am so fucking sick of these piece of shit communists.

    FUCKING RESPONSIBLE?? ARE YOU FUCKING KIDDING ME?

    GOD I HATE THESE PRICKS.
     
  238. The black boxes, which represent over 50% of the volume on most exchanges and that arb the shit out of everything would also be affected. Liquidity would really go to hell, this cannot be allowed to pass.
     
  239. Looks like we might be safe for now:

    http://www.reuters.com/article/newsOne/idUSTRE48O7X720080925

    I think the responses detailing how it will effect liquidity and such should probably be directed to Pelosi's office herself and perhaps to the renegade Republicans that actually listened to the responses they got from economists about the bailout plan. It sounds like this DeFazio guy has it out for all short-term traders. Traders complaining is probably music to his ears.

    Anyone know any respected economists that we can get up in arms?
     
  240. Here's the actual proposal. They were just talking about companies paying a premium to the government to have their bonds insured. I don't like the way they titled it, but this is what the actual proposal said (this was linked to in the article):

    I. Wall Street - Not Taxpayers - Should Fund the Recovery

    The most troubling part of Sec Paulson's plan is that it relies wholly on taxpayer funds. House Republicans believe that rather than providing taxpayer funded purchases of frozen mortgage assets to solve this problem, any rescue package should adopt a plan to insure mortgage backed securities (MBS) through payment of insurance premiums.

    Currently, the federal government insures approximately half of all MBS and can insure the rest of those still outstanding. However, rather than taxpayers funding the insurance, the holders of these assets should pay for it. The working group's proposal would direct the Treasury Department to design a system to charge premiums to the holders of MBS to fully finance this insurance.
     
  241. Okay, I wrote a letter. Please feel free to cut and paste and use it. Also, *please* comment because it's been a long while since I've written much of anything. I'll revise it based on comments.

    http://susannahscratchpad.blogspot.com/
     
  242. The proposal you're referencing is from the House Republicans. The "transaction tax" idea is a separate proposal from a group of Democrats.
     
  243. I know, that's why I quoted huh. I was referencing what he said. He was inferring that Republicans might go along with this Democrat proposal because of the ominous way the Republicans had titled their proposal. I was just stating that the actual proposal by the Republicans was sane and made sense, despite the ominous title.
     
  244. It sounds like they want to put the decision on the transaction tax off until after the election.
     
  245. DeFazio said in his letter that "the easiest method to raise the $700 billion from Wall Street is a securities transfer tax, a tax that has a negligible impact on the average investor and provides a disincentive to short-term traders."

    The current crisis is not caused by short term trading, but by excessive risk taking of long term traders/investors. What the hell is in his mind? Imposing a 70% tax on gains from home sale makes more sense.
     
  246. Couldn't agree more.

     
  247. Reality doesn't matter. "They hate us for our freedom."

    "Ya mean pay for it from somewhere other than my taxes? Sounds good to me."
     
  248. Unfortunately, politic is not about rationality and/or logic. It's all about pleasing the majority.

    The problem with a transaction tax (for us daytraders) is that the cost is invisible. There is no "this costs us 50bn a year" showing up in the budget. You can't see it anywhere, it's just a hidden cost, unfortunately.
     
  249. why does anyone even bring this stupid ridiculous subject up? the chances of this ever passes are zero. this would not just affect day traders but 20-30 million americans who trade 2-20 times a month. it would bring liquidity to a complete halt and spreads would widen to $'s and vol would fall 90% thus putting 3-5 million people out of business from stock brokers to 90% of all brokerage firms gone. the market would fall 50% immediately.
     
  250. What a complete moron. He is essentially saying "We don't want the taxpayer to pay for the bailout so what we are going to do is tax people in other ways and try to make it seem like it is not actually taxing the taxpayer. Don't tell anybody that the taxpayers actually buy stock sometimes or that liquidity will plummet so they get screwed over by the bid-ask spread. Furthermore, the great thing about this plan is that this tax will remain in place even after we have recouped our bailout losses! Brilliant! That way we can take advantage of investors day in and day out for all eternity!"
     
  251. How can you be so sure considering what has already taken place in the financial markets? Socialism/communism here we come.
     
  252. well if it ever passed and the mkt drops 50% or more and vol collapses 80% then the country's in a depression and the avg citizen will storm congress . nothing will matter then. anythings possible but the liklihood of it happening are as close to zero as one could get. if it happens i hope all day traders saved there money and can open another business
     
  253. You're wrong. It will be less liquidity, but far from your figures. The market won't drop by much either. Why should MSFT drop double digit percent just because there is an entrance fee of .25%? I would certainly be buyer if it drops!

    As the situation is now I'm fearing what will happen. Typical when we're in a mess free markets and capitalism gets the blame.
     
  254. i tell ya what, MSFT may think twice about doing a 40 billion dollar buyback, would be very expensive for them
     
  255. At .25% there won't be a market anymore.
     
  256. they're looking to spank somebody too with this bail-out plan, and traders are first in line. Total BS :( :( :(
     
  257. lol day traders and black box boys are doing 50-70% of total vol on the exchanges. shit i'm pushing 700k shares a day.ALSO WE HAVEN'T EVEN TALKED ABOUT THE HUGE INCREASED COST THAT MUTUAL FUNDS WILL HAVE TO PASS ON TO THERE HOLDERS. this would affect everyone. we can't control what happens.maybe it means few will trade and just buy and hold and stocks will rise 50% a year.
     
  258. <I>Okay, I wrote a letter. Please feel free to cut and paste and use it. Also, *please* comment because it's been a long while since I've written much of anything. I'll revise it based on comments.

    http://susannahscratchpad.blogspot.com/</i>

    Great letter. You captured it very well. I urge other people to do the same. I just wrote to both my senators and my representative in the House. It can't hurt.
     
  259. We need to emphasize how this would hurt the RETAIL INVESTOR. Because nobody gives a crap about daytraders.
     
  260. Damned politicians (and the entire media for that matter). They don't understand the cause of the problem. It was not subprime lending, it was not speculators. It's the banking system that can't disiminate free money for a consistent proffitt and can't survive a 20% downturn. There has got to be a more efficient and stable manner of controlling money supply, and it involves actually more trading and more speculation, and less good ol' boys banking tactics! How can all of the rhetoric on this mess be so entirely miss guided! It's uber-frustrating.

     
  261. Exactly. These people could care less about the 10,000 (tops) day traders in the US. But, they must understand that you are now taxing EVERY single stock, mutual fund or pension holder in this country.

    Damn, the Democrats are fucking idiots.
     
  262. good point
     
  263. Soooooooooo.........all traders, not just mortgage backed security traders would suffer. Sounds great. Weren't the politicians the ones who created Fannie and Freddie to buy these pieces of crap and push higher risk lending on banks? Granted that was decades ago (Louis Ranieri), but who do we blame NOW? The traders and speculators in a free market?

    Yes, I am part of all of this. Full time daytrader, and a real estate speculator. Got burned on some houses and in the end, it really is my fault. Sell at a loss and learn a lesson, same as in the US 10year futures I trade. Come back stronger and smarter.
     
  264. I'd say you're correct, but not taking it far enough.

    Say you're a moderately sucessful, pro trader, made $200k this year. So 200k is gonna be taxed.

    On the other side, there's 20 losing traders, playing around, that lost 10k each, so the guv lost 200k in taxable income, right?

    Wrong. You can only claim a 3k loss, so taxable income was reduced by only 60k.
     
  265. Since they can't fix the problem, they may as well burn some witches. Nobody likes witches. Nothing new here. Just be thankful they only want to put you out of business.
     
  266. while driving last week, i heard a lady representative trying to discuss naked short selling, which she blamed on the uptick rule... so you see, it was all because of the lack of uptick rule:D
     
  267. Quote from bbqbbq:

    actually, the biggest enemy of the government is the buy and hold investor. they only hold, thus never pay taxes.
    ----------------------------------------------
    you just described Warren Buffet and provided the basis for a "wealth tax". buffet is worth a lot less if you back out unrealized tax liabilities.
     
  268. Look.....

    Just ask those people who owned buildings in the tax reform act of 1986.....

    Anything can happen...

    Obama benefited from and supported individuals in FNM, FRE....

    McCain says he's a spendthrift...but his wife has been known to spend $500k a month on AXP...his kid spent $50k.....in a month...and he's tellin the US he is going to balance the budget?......

    ......................................................

    And the bottom line to the crisis is a few million bad loans which were levered out at institutions....

    The problem is real estate ....

    Thus is no surprise that the politicians are trying to look somewhere else...

    ...............................................

    Here's a few items...

    Tax credits to buy a house...will help comps....

    Tax credits to stay in a house.....

    Low interest fixed 30 year loans for those who want to stay put....will ease lower comps......

    Ease mark to market accounting rules.....for what's on the books....

    Increase tax credits versus time of hold on houses....
    ................................................

    Phase these rules out over 5 years....
    then back to 20% down min....managed locally, etc...
    ...................................................

    One is not going to find a solution for home real estate jackin folks around that work in stock markets....

    But F'in morons.....are just that.....

    ...........................................

    If you want to listen to something substantive ...listen to the Roubini conference call....

    Roubini has a good handle....

    http://www.rgemonitor.com/
     
  269. anyone w/o political clout is an easy target for govt. daytraders have no clout & the brokerage industry probably doesnt have enuf influence, so if this passes, the next step when they add to the $700B will be to increase the tax rate from .25% to .50% & so on... so maybe they start with .25% and a few exemptions, such as ETFs, then the ETFs get taxed, maybe at .25% when they raise the "base" trading tax to .50%.

    this is the kinda action that killed the horse racing industry where takeouts on exotic betting pools are like 23% so instead of a $500 exacta, you get like $375 - thats a big price to pay to risk your money. :eek: - you see that the payout would have been almost a 1/3rd higher! then the tracks use breakage, where a $2.39 payoff on a $2.00 bet is rounded down to $2.20... only $.19, right? well its almost 10% of the payout and appx 50% of the winnings... you cant beat that set-up & eventually only the VERY BEST traders will beat the trader's tax.

    eventually, after they lock down capital controls, there will be a wealth tax, so you will be screwed if you trade and screwed if you dont trade, and it will be a crime to try and pick up your money and leave. there is already and "exit tax" for people that are fed-up and just wanna leave... you leave anytime you want, but you can never (really) checkout. this is the beginning of the end, b/c once its in place it will never be repealed, only the tax rate will change, and it will only go in one direction.
     
  270. I fear you're right. But I must wonder when they'll make the trading tax retroactive a few years just to really bust ALL traders, even the big guys.
     
  271. A few questions/comments IF this ridiculous tax passes.

    1. Could we now just trade on CMC markets? With the amount of traders that would flock there, I would assume the spreads that everyone complains about would get tighter


    2. I think traders are traders and will find a way to make money. Therefore, I believe the small-cap market is explode, as would the option markets as they offer far larger % moves to overlap the 0.25% deficit on every trade

    3. Would Canadians have to pay this tax?
     
  272. i suspect only to January 1, 2008.
     
  273. What you might want to think about is who really does the most trading today......and if they have any political clout....

    Big pension plans and the largest pools that have a lot of stocks....

    Hey obviously Dean...had a little influence with regards to debt securities.....people like Gabelli and others laugh at crap like this....

    I really do not think that they will tax securities in this fashion....

    Ain't gonna happen.....
     
  274. how about a special tax levied on all earnings of firms that receive tax payer bailout?

    How about a 5% tax on bonuses of executives of firms that receive tax payer bailouts?

    How about a 1% tax on earnings of all those who decide to grant tax payer bailouts?

    piazzi
     
  275. Look....

    The only thing that is really going to help this situation is how to upwardly influence the value of a house.....and to keep people from walking away....

    All this problem is...in simple terms is that there are 15 million homes at $240,000 par value....that went to $70,000.....and all that can be done now....is to make the value as high as possible.....

    High as possible with tax credits etc...is probably at 170,000.....

    Everything else has to wash out ....

    ......................................

    Look....the big boys put down 3% on a $24 stock that went to $7...and got wiped...and whoever grabs the $7 may see the $17....

    That's it......

    They can dance around other crap all they want......but this is it....

    The diff between $24 vs $17 is the amount that somebody has to eat.....

    Low interest long term bonds....and lower taxes will increase the tax take....

    If a simple consumption tax was introduced....the US tax take would skyrocket.....businesses from all over the world would flock to the US....

    And this is all they are worried about...the tax take....

    Lower, simpler taxes....and a lot less legal largesse means a lot more taxes.....
     
  276. i hope you're right, but remember that pensions just pass along the costs - the pension fund is NOT ultimately paying the tax... all funds will be taxed at same rate, so relative performance would stay the same. so does Gabelli really care, except to the extent that investors withdraw funds?

    i doubt that Gabelli of any other sane person is laughing at this.. you might turn over your account 100% plus a day - Gabelli maybe that much in a year or two.

    again, i hope you a right... once an idea like this gets floated, it seems to never go away.
     
  277. ways around this, the law makes you find another loophole why do you think bookies in this country are still around they re locate, stocktraders dont care what markets they trade they just want to trade so if it means relocating to another country it might not be a bad thing with they way the future of this country looks cost of living will be cheaper and you should be making the same income as back home, or and i think this is the path most of us will take if there are some exemptions and i think there will be renting exchange status seems to be the play if you belong to an llc or form some entity that might be the tax you have to pay to stay in business, unless the irs doesnt consider this a write off then the guns will be a blazing
     
  278. No...Gabelli would laugh at how stupid it is....and he and his pals would spend a few million for a few lobbyists....and just look at it as the cost of doing business.....

    People like Gabelli are used to dealing with nonsense.....

    And people like Gabelli are not going to let shit like this happen.....
     
  279. That's the most magnificent run-on sentence I have ever seen. :D
     
  280. Ironically, Peter DeFazio has a great record on h-1b and immigration in general - being on the 'take' doesnt lead to a record like his

    http://profiles.numbersusa.com/improfile.php3?DistSend=OR&VIPID=677

    so good, i'm surpirsed i'd never heard of him prior to this transaction issue

    my point is this - i think there's a chance he's a good guy, but just caught up in the emotion of this - Lord knows i feel screwed by the bailout

    I really think, if he knew he was crushing a person (me, and many other tech refugees) who was crushed by H-1b (and that I'm NOT now causing this problem) it might sway him.

    he doesnt have a numbersusa 'prick' profile. this may be more a perception issue than a character issue

    that's why it's important that our side pleads with him respectfully

    it's obvious that he has listened to reason on H-1b visas

    most of them dont

    he needs to realize that some of the moles he's trying to whack are innocent
     
  281. So you're going to contact him?
     
  282. bookies are around in horseracing b/c the takeout is so large that it kills the track odds. they take the bet and then payout track odds (net of the takeout). the bookies are more efficent than the tracks, because they dont have to disburse the takeout to the horseman, purses, etc... at least until they get caught. thats why vegas never wanted to co-mingle their pool with the tracks. i dont remmeber the exact dust-up, but that was it.

    but just look at this.

    you go long $100 stock, you make a buck.. the tax is $.25 +$.2525 or .5025. the govt takes over 50% of your gain and then taxes the other 49.75% at ordinary (income) tax rate. in Cali if you pay close to 40% combined rate, your tax would lower gain to just under 30% (29.75%). so you made $.30 net on that trade. if your next $100/share trade is a scratch, you still owe $.25 in and $.25 out or $.50... so you are down $.20 for the day... and thats with a 1% gainer and a scratch... does not include brokerage commish and overhead. over time, they chew you up, just like the racetrack punter.
     
  283. yup

    and i'd urge that anyone who does have a respectfull attitude

    because he thinks he's crushing the haughty and the arrogant on behalf of the little guy. there's so much emotion going on in washinton that it has blurred who is who

    it's not a time to act like the people he thinks he's targetting

    and as a general rule, whenever you contact a rep, do a little background check on who they are. if there's anything they've doen you repsect, breifly thank them for it. maybe there's nothing

    but if a stranger calls them and basicly yells YOU'RE MY ENEMY!!!! how the hell do you think they're going to react? Washington is a rough place, and they are skilled at classifying people quickly. Dont classify yourself as 'discard' or 'crush' when you call

    I've made countless calls on immigration, I speak from experience here - number one issue when you call is 'what is your goal'? TO get aggrivation off your chest? Or influence policy?
     
  284. It's ironic that small independent traders as a group are very opposed to the sorts of shenanigans that led to this crisis, and that is who the transaction tax would hurt the most.
     
  285. hahhahahahahha! i just peed myself. were you born yesterday? how much did you contribute to his campaign? nothing? too bad then!

    read back on Libertad's post about the 1986 changes in real estate - i had people threatening to sue me if their deals didnt close by 12/31/1986.

    yeah, he's laying up awake a night worrying about you. the govt is so worried about us they borrowed and spent the Social Security Trust Fund, the FDIC Reserve Fund and every other
    penny they could get their hands on. and just last week they provided funds for foreign banks! govt has not balanced a budget or set aside a contingency since when? and no, Clinton's budget wasnt balanced net of the SS Fund theft!

    seriously, get a clue! :cool: his job is to get re-elected. they use fear and blame - we are just pawns - this is gonna get sold as "no cost to taxpayers" and then every little taxpayer group they can demonize & "F" is gonna take it dry and get TAXED...
     
  286. that's why it's so imperative that we plead this issue wisely

    we're innocent, didnt cause this, and dont benefit from it. we're the little guy, in many cases the little guy that DeFazio has tried to protect on other issues like H-1b

    we have to act like it - emotions are high all over the place

    i'm not saying i'm not outraged, this is like H-1b all over again for me
     
  287. so how that working amigo?:p
     
  288. nearly every immigration increase bill for the last 2 years has been blocked by opposition

    and if you were part of the solution (a numbersusa member like me), rather than a smart aleck on the sidelines, you'd already know that
     

  289. DeFazio's record shows that on immigration, he's stood up AGAINST the party line and lobbyist money

    anyone who knows anything about immigration can analyse this record and see that

    http://profiles.numbersusa.com/improfile.php3?DistSend=OR&VIPID=677

    so what are you trying to acomplish here? does someone elses 'wasted time' trying to influence this really cost you?

    for those who are cynical and think it's hopeless, can you at least get out of the way of those who are constructive here and trying to do something?
     
  290. we need to seriously consider kicking out all illegal immigrants and deporting immigrants from the last 100 years, starting with the damn irish.
     
  291. Here's the actual letter DeFazio wrote, just for the record. I got it from this site: http://workinglife.org/blogs/view_post.php?content_id=9603

    September 23, 2008

    Dear Colleague:

    The Bush Administration is asking Congress to authorize the U.S Mint
    printing presses to crank out $700 billion to cover the illiquid assets
    of Wall Street. This will sink our current record budget deficit to
    levels never before imagined.

    The $700 billion is to protect Wall Street investors, therefore the same
    Wall Street investors should pay for this infusion of taxpayer money.
    The easiest method to raise the $700 billion from Wall Street is a
    securities transfer tax, a tax that has a negligible impact on the
    average investor, and provides a disincentive to short-term traders.

    This transfer tax would be on the sale and purchase of stock and more
    exotic transactions such as credit default swaps, options, and futures.
    A quarter percent (0.25%) tax on financial transactions could raise
    approximately $150 billion a year.

    There is considerable precedent for this. The United States had a
    similar tax from 1914 to 1966. The Revenue Act of 1914 levied 7a 0.2%
    tax on all sales or transfers of stock. In 1932, Congress more than
    doubled than tax to help plug the holes from the Great Depression. In
    1987, Speaker of the House Jim Wright offered his support for a
    financial transaction tax. And today the UK has a modest financial
    transaction tax of 0.25 percent, a penny on every $4 invested.

    In the past, economists such as Larry Summers, John Maynard Keynes and
    Nobel prize winners Joseph Stiglitz and James Tobin have supported
    financial transactions taxes.

    This tax could be easily implemented as the SEC currently implements a
    very small tax per transaction to cover its costs. All Congress needs to
    do is raise the rate by 0.25% and designate the new income to the
    general treasury to pay for the $700 billion.
     
  292. the bill is called the FUCK DAYTRADER TAX
     
  293. Isnt Jim Wright the guy who screwed anyone who flew in the southern half of the USA for the benefit of DFW airport? ie 'Wright Amendment?'
     
  294. More like "DEMOCRATS WANT TO FUCK DAYTRADERS" TAX.
     
  295. Yes, although that wasn't the intent, it was a complete FUBAR on all fronts really:

    http://en.wikipedia.org/wiki/Wright_Amendment
     
  296. with economic recession & asset deflation, the govt has to look to tax areas of high money velocity - the bailout is just a smoke screens... they create a dollar and if it turns over 7x in the economy, they can essentially tax it seven times, with the States & municipalities getting on sales & State taxes. all the piggies i the trough.

    they did the $300 stimulus checks to encourage people to SPEND, not to put it in savings acc'ts. if people increasingly hoard cash, the govt will be forced to impose some static tax, such as wealth tax... kinda like real property taxes - i pay that & there are still potholes all over town:p so the wealth tax is a penalty on static assets... they want us to move the money so they get their vig.

    i find it interesting that DeFagio mentions the historic precedent, but does not reference all the other additional taxes we pay now that we didnt before.

    no one believes daytraders caused the subprime mess, but they are a high money velocity group w/o much collective political pull.
     
  297. Yes and No.

    In no uncertain terms, tell the Politician or their Lacky:

    1) Not only will you vote/donate to the Politicians Opponent in the next election if they vote Bill XYZ, but also

    2) YOU WILL CAMPAIGN FOR THEIR OPPONENT IN THE NEXT ELECTION, if they vote for Bill xyz.

    That gets their attention.

    Trust me.

    They'll sacrifice a single voter here or there.

    But to alienate 1 voter and turn him into 100 votes *against them* come next election? That gives those douche bags pause.

    Hit 'em where it hurts.
     
  298. Thats incorrect.

    Those 20 traders already paid income tax on that 10K before it entered the market.

    Everyday, winners who leave the table pay tax on their winnings (which come from the losers capital, which already was taxed).

    So the Government actually taxes market capital twice. Or 100% of whatever the effective rate is.

    And thats not enough. They want everything.
     
  299. Wrong. Those losers could deduct loss from other income.
     
  300. Lol!

    What profession allows day-trading losses to be deducted as a tax expense??

    Lets see. Mr Dentist deducted 30K in employee salaries, 20K in malpractice insurance, and 10K in day trading losses!

    Sounds like a plan!
     
  301. Isn't this plan in effect banning short term trading?

    How the hell is anyone supposed to get in and out of a position without getting killed on a spread wider than Paris Hiltons gap?


    Moderator, please delete this thread as I'd rather pretend ideas like this from our elected officials do not exist.
     
  302. How do you know they paid income tax on that?
     
  303. Aren't you allowed to deduct up to 3k a year in capital loss?
     
  304. Why would you assume they didn't?????

    Its nearly impossible to deposit 10K cash into a bank account, than transfer it anywhere.
     
  305. When are you liberals going to wake up and realize these are the kind of bonehead ideas democrats dream about all day long. How bout that fantastic idea Slick Willy had to tax everybodies 401(k) plan 15%. Oh, you forgot about that one didn't you? I bet they have wet dreams about getting their hands on the whole estate tax again too. Just pathetic.
     
  306. The govt could always exempt pension funds, mutual funds, broker-dealers and such. So really only the little guy gets screwed.
     
  307. Wouldn't an increase on the short-term capital gains tax make more sense than this? Remove the 60/40 preferential treatment for futures trading, and make almost all of them short-term like they are and you've got a *lot* of taxes coming in.

    Also, they wouldn't be reducing volume or liquidity drastically, so I'd think it would actually work out to be more overall money for them.

    It'd also leave the "investors" out of it for the most part, pretty much be on speculators only.
     
  308. If things change.....then there will be other venues to the goal.....

    Man....would it not be great to be truly independent....and not have your livlihood threatened by idiots ....

    So much for thinking a trader is his own boss....

    Still vulnerable to fucking idiotic and toxic politicians.....

    Fucking idiots.....
     
  309. They could exempt everyone except the little guy. But the little guy woulnd't be able to afford to trade so there would effectively be zero new "tax" $'s.
     
  310. Yea, you're right. I'm wrong. Its not double-taxed.
     
  311. http://www.reuters.com/article/bondsNews/idUSWBT00986620080927

    WASHINGTON, Sept 27 (Reuters) - Democrats in the U.S. House of Representatives are pushing for a new Wall Street tax that would cover the potential costs of a $700 billion bailout being negotiated by Congress and the Bush administration.

    U.S. House Speaker Nancy Pelosi, speaking to reporters after a meeting with fellow Democrats, said the fee could be assessed after five years if the non-partisan Congressional Budget Office determined taxpayers had lost money in the bailout.

    "If after five years ... the CBO decides that the American taxpayer has lost money in this, then there would be a fee on financial institutions," Pelosi said, adding that she hoped the provision could be part of a final bailout deal.

    Pelosi said that the Secretary of the Treasury could determine how to assess the fee.
     
  312. Well ... gives us 5 years to trade lol
     
  313. Cool, 5 years. Hopefully Dunkin' Donuts is hiring by then.


    This is such nonsense plain and simple. People with incomes of 30k want to buy 60k cars and 600k+homes, and apparently we are at fault. And now it just feels like the gov't and media has declared war on us.
     
  314. that frrigging slut is seriously considering it????

    why would anyone in their right mind even vote for democrats?

    this is the END of daytrading in AMERIKA.

    nice knowing you guys
     
  315. What US politicians fail to understand is that taxes are just passed on to someone else.....

    The biggest point totally missed is that less is more.....

    A simple 10% consumption tax and no other taxes would increase the US tax take many fold.....

    Companies from all over the world would domicile out of the US.....

    Jobs would flock to the US.....

    Less....is more....
    ...........................................................

    Any exchange that lowers transaction costs increases business many times over.....

    And other possibilities evolve.....even the better distribution of wealth....

    An increase in trade....is an increase in business and jobs....and taxes.....
    ....................................................

    Business grows as efficiency grows....

    The commerce of the world depends on efficiency.....and is very sensitive to small incremental changes....

    Increases in taxes and legal largesse lower efficiency and business...

    FUCK SOCIALISM....AND AMAZINGLY INEPT STUPID POLITICIANS THAT KNOW NOTHING AND THINK THEY KNOW IT ALL.....
     
  316. This proves once again, that despite what ANY DEMOCRAT might actually say, they are ALWAYS looking for ways to increase taxes.

    They love opportunities like this where they can slip a tax on a group of people, where the public won't penalize them (Dems).

    Wolves in sheeps clothing.
     
  317. I'm not convinced that they aren't still planning to stick us with this transaction tax in the near term. I'm not sure this "fee on financial institutions" that MIGHT happen in 5 years is meant to refer to the same thing. It's probably still worthwhile to brainstorm ideas about how, where, and what to trade if this transaction tax were to become reality for US markets because it would certainly destroy my currrent business model. (I feel like the people that owned wine shops in Tehran when the Islamic revolution came. Remember the news footage of all those bottles of Bordeaux being smashed in the street? "The government has decided you better look for a new business to be in.")
     
  318. If the 5 year period turns out to be true, at least it would give the financial industry time to lobby this thing. As it stands right now, there is so much disapproval with the financial industry among the American people, that it would be easy to sneak through.
     
  319. So the prudent firms (and their clients) that avoided the toxic junk get a new tax, and those who ran other firms into the ground get to keep the millions they received for doing so?

    The biggest problem with the bailout comes down to the question: who's going to pay for it? Good firms/traders who had nothing to do with it? Future investors who had nothing to do with it? Taxpayers as a whole? Any way you cut it, it's absurdly unfair, unless the government wants to do the hard work of confiscating the personal assets of the willfully shortsighted executives/fraudulent mortgage brokers/home buyers who wrote fraudulent applications, etc. But that's of debatable legality in the present framework, and is just too much work for them to consider.

    In light of that, I couldn't support this bailout, even if Buffet, whom I respect, does. There's no guarantee the bailout will help, anyway; consider the stimulus package, which surely didn't help us avoid the pain of reality we must face.

    I'm no economist and I hope I'm wrong on this, but seems likely to me that the only long-term outcome of this bailout will be to prolong the lifespans of hyper-risk-taking banks that should be allowed to fail, in fairness and justice.
     
  320. i turned to daytrading after getting my tech career destroyed by h-1b visa

    when the public turns agaisnt you, you're fucked

    everyone will bleat the party line

    accusation = guilt

    lies = truth

    facts be damned
     
  321. don't forget how drastically reduced daily transactions would be therefore rendering this proposal useless.

    They wouldn't collect shit.

    This is so painfully stupid I'm not even sure why its being discussed.
     
  322. I've heard you reference this several times. What is the h-1b visa?
     
  323. There is no point to complain. Let's think of alternatives. As of now I can think of focusing on options trading and possibly CFD's
     
  324. Maybe if Cramer knew about this potential threat he could use that loud mouth for something useful. :p

    Seriously, I think the proposed tax would do him some serious harm so he could pound the drum against it and give us a voice in the mainstream media.
     
  325. this is the end of IB, assent, lightspeed, laser LOL
     
  326. it is a program to import massive forein workers into the tech occupations

    mr 'two americas' john edwards, co sponsored a bill in oct 2000, to bring 195,000 foreign workers into the tech occupation right as the tech bubble burst

    in 2001 9 out of 10 workers hired in tech in the USA were foreign in a period when the industry actually shed jobs

    it was a complete nightmare, a 'kafka' like transformation where society turned on a group of people (tech workers), without provacation. it;s as though society decided arbitrarely, that a group of people deserved to lose everything they had worked for, without cause

    for example. wes clark in the 2004 debates"

    "Let them do the software in India; we'll do other things in this country. "

    so if you worked in software, we;re tossing you out of your livelyhood

    we cant tell you why, and we cant clarify what 'other things' means
     
  327. they know u have no other option but to use cfd's..then watch how they rape u on commish
     
  328. yah and many of these indians are cheats, use fake degrees and collude with tech companies to grant them visas
     
  329. Damn, that's actually really sad.

    Don't really know what else to say.
     
  330. Ya well a higher commission is better than a % tax..

    Secondly, I think the options market will really start getting serious attention and volume
     
  331. If there is a five year window.....
    then by then companies such as BATS will be offering other exchanges in other domiciles....

    Other exchanges will be broadening their offerings...especially China.....

    Hopefully there will be a Universal Securities Highway....

    Like an IB on steroids in the domicile of your choice....

    The securities trading business is going to grow...

    Direct access internet trading is still a baby....

    What one will see in five years will dwarf what is present today....

    And yeah....what is not going to change is that there are going to be humans still pressing buttons....

    But there is going to be a lot more of them...

    The current day socialist think ....can go fuck off.....let the fucking idiotic politicians look at themselves on TV, media....etc...

    Man, the two party system has got to go....

    My bet is that companies like Genesis are going to grow exponentially with different trading venues and domiciles....

    Hey...speedboats will still run around big ships....this is not going to change......
     
  332. What "other things" are there? :confused:

    We've exported manufacturing. Now all we've got is ag and service, but we're outsourcing that too.
     
  333. Maybe they can amend the proposal slightly, and make (1) selling of oil futures and (2) buying of equities both tax-exempt.

    Oil up and equities down = bad
    Oil down and equities up = good

    What has the US come to?


     
  334. "other things", means 'innovation'. but nobody's ever clarified what we will 'innovate' and why 'innovation cant be outsourced.

    frankly, having been in tech from 1987 to 2001, and part of a field that 'innovated ' more than almost any field in history in that space of time and created more wealth in same period, i find that kind of insulting

    and that was 195,000 PER YEAR, plus about 65,000 per year L1 visas, plus the caps were not even enforced. those caps do NOT count renewals

    I took daytrading as "other things"

    but aparently, I didnt ask "captain, may I"

    so I guess I deserve to lose this occupation too
     
  335. This guy is not the brightest bulb in the chandelier. His precedent is in the period 1914 to 1966... lots of daytrading going on in those days for sure!! Maybe once he realizes that he will undergo a big net loss in tax revenues due to the death of the trading industry he will think it through one more time......

    I sent letters to my congressman and two senators explaining how it's bad on several fronts...
     
  336. if this law does pass watch how easy it will be to become a member of an exchange. nasdaq nyse arca these companies revolve around volume thats the name of the game. that is how traders are making a good living trading london, they get around the stamp tax because they are members of the lse. there will always be loopholes people no need to sweat it.
     
  337. You said it man.. there are always ways around these things but instead of discussing how mentally retarded Defazio is, we have to take action.

    1. Write your congressmen

    2. Start looking for loopholes
     
  338. So is 5 years really the new deadline? If that's true, I'm probably

    ok with that. That's plenty of time for the CME and others to

    develop alternatives (outside of the US) that may actually be

    better for us than what we have now.....

    American ingenuity isn't dead yet.....These giants are not going

    to just give up and shut down

    Many other countries would welcome what our politicians drove

    away......I'm usually a pessimist but this whole thing may turn

    out to be a blessing.. We may actually be using the "third finger

    salute" when all is said and done.........I welcome opposing

    thoughts.....
     
  339. That is what I said in my email to my reps, that an entire industry was going to go offshore....

    Here's another reason the transaction tax might not fly ever, it would affect hedge funds would it not? That is where the big money people have their money, no? Big money people will be writing THEIR congress people........
     
  340.  
  341. "HAD considered"....past tense language here is encouraging....

    "The Senate aide said a number of specific ideas appeared to be gaining traction Saturday evening, most notably the concept of creating a "financial stability" fund financed by Wall Street and styled in the mold of the deposit insurance program run by the Federal Deposit Insurance Corp. Lawmakers had considered levying a tax on some securities transactions to help offset the cost of the $700 billion rescue plan, but the idea of assessing fees on a wide swath of financial firms to help pay for current and future government bailouts had its proponents."

    http://online.wsj.com/article/SB122252502326482359.html
     
  342. That is encouraging, but I have to vent one more thing.

    Can you imagine what this would do to someone gamma scalping an options position all day with a tight delta?

    Perhaps beyond the scope of this thread, but what would be a ton of very small profitable trades throughout the day would disappear.

    All of the small traders getting hurt, along with the large traders doing a thousand small trades per day, is why this has already gotten shot down.

    But it is just scary that this was even proposed in the first place. As was stated before, this has a precedent based on the depression era, and our politicians are incredibly ignorant as to what is going on with somewhat complex issues.

    They're compelled to act and tax before they analyze.

    Scary stuff.
     
  343. "The fees and the fund would likely only apply to larger firms over a certain asset size"

    If that lets us little guys off the hook I'm very relieved...
     
  344. Exactly... go ahead and penalize the hedge funds if necessary... but to attack the retail traders (who use daytrading to pay their mortages.... ) is ridiculous... it'd be really ridiculous to ruin the small retail traders business, which would likely make many of them default on their mortgage, which is what got us into this mess????? These guys have to think things through
     

  345. I would imagine this is the first thing that got their attention as to why not to do it.

    Not only retail, but a prop guy like me who MIGHT make 100k this year, but also provides liquidity 90% (estimate) of the time. (a small fish i know)

    What they don't realize is that there are tons of prop guys out their providing liquidity through running APIs etc, and if that goes away, well then I guess the market makers at large firms would get exemptions...yada..yada..yada
     
  346. I think it's only going to kick in after 5 years if the bailout loses money for the taxpayers.. I missed that story until just now, it's on Drudge...
     
  347. That was actually brought up earlier in the thread. I was basically stating that I don't ever see this happening. The lobbies which would be created between now and then would be enormous.

    Don't worry about it dude. Good discussion. 60 pages is allot of reading on a sat night.
     
  348. According to Reuters, Pelosi is considering the tax to take effect in 5 yrs if the gvt loses money on this deal. This is not going away:

    http://www.reuters.com/article/wtMo...T00986620080927

    WASHINGTON, Sept 27 (Reuters) - Democrats in the U.S. House of Representatives are pushing for a new Wall Street tax that would cover the potential costs of a $700 billion bailout being negotiated by Congress and the Bush administration.

    U.S. House Speaker Nancy Pelosi, speaking to reporters after a meeting with fellow Democrats, said the fee could be assessed after five years if the non-partisan Congressional Budget Office determined taxpayers had lost money in the bailout.

    "If after five years ... the CBO decides that the American taxpayer has lost money in this, then there would be a fee on financial institutions," Pelosi said, adding that she hoped the provision could be part of a final bailout deal.

    Pelosi said that the Secretary of the Treasury could determine how to assess the fee.
     
  349. Why are you posting crap that has been posted 50 times in two seperate threads?
     
  350. Thanks for posting this information, forwarned is forarmed.

    While a breathrough has been reached in the Bailout Negotiations, the NY Times article does not speak to this specific issue.

    And while I'm a registered Democrat, I do not (nor would any trader in their right mind) see this as being a good thing.

    Point-in-fact I am actually on the side of the hard-core Republicans on this one, I don't think there should be a Bailout at all.

    "Some lawmakers have made clear that they will not vote for the bailout plan under virtually any terms. “I didn’t want to be in the negotiations because I object to the basic principles of this,” said Senator Richard C. Shelby of Alabama, the senior Republican on the banking committee, who would normally be his party’s point man. "

    Just to show you that everyone has their perspective on this mess ...

    ***

    P.S. This isn't the time to argue amongst ourselves, but rather to continue to work together to make sure that we will not be blindisded by the decisions of a few misguided fools who are responsible for lawmaking in our country.

    To me it is amazing that we are even having this conversation, but here we are, people are stupid and greedy.
     
  351. This is the only way out of this mess, play the game by the rules which have been established (even though the government seems to want to change them at whim). But we have to start now if we want to come out on top.

    LOL, I agree on all points.
     

  352. Absolutely agreed. We'll find out tomorrow.

    Good trading to all, and hopefully politicians will not intervene (well, not any more than they already have).

    Night all.
     
  353. http://www.politico.com/news/stories/0908/14015.html

    Noteworthy section that made me breathe easier as a self-employed trader:

    ****************

    On two key points, compromises had to be reached on competing priorities for the two parties.

    In the first case, Democrats had proposed that the Treasury be required to impose a fee on Wall Street transactions to help cover the cost of any government losses as a result of the rescue plan. <B>But Republicans and Treasury resisted, and the final compromise calls for the next president to submit a legislative proposal to Congress in four years, after some assessment can be made of the costs to the government.</B>

    The second compromise dealt with a Republican proposal that the government intervene in the markets, not by buying up bad assets but by providing a federally backed insurance program that might make the same mortgage-related securities more salable. The compromise reached would require Paulson to set up such an insurance alternative if he goes ahead with his plan, but he is not compelled to use the insurance option.
     
  354. Well I guess we have our answer there.. we'll be ok for 4 years I suppose? And.... vote for Mccain lol
     
  355. Shit now I can go to bed and sleep-in tomorrow knowing this will be kicked around for at least 4 years while people in government come back to their half witted senses and hopefully kill it for good.
     
  356. Thank god... but during these years we have to fight incredibly hard to make sure we don't have to worry about being out of business and int he exact same position 4 years from now! Let's make sure we DO NOT FORGET about this... daytrading was on the brink of extinction.
     
  357. This is the reason why most things get through. Penalize - but not me. NOONE should pay the tansaction feee.
     
  358. Actually this is a golden opportunity for smart companies to offer trading venues with differing government domiciles and markets.

    Most likely a sophisticated LLC model with various exchange memberships would be most likely.....

    What is most preferable would be an IB type format with differing legal domiciles, with access to all markets....

    Why not ?

    I would be very surprised if Peterfly is not all over it.

    Also, companies like BATS will be all over it....they already are positioning themselves.

    The world and its keener securities businesses know how stupid the US political scene is getting....and will know that diversifying their business out of the US domicile is the smart thing to do.....unless of course they want to subject their life long work and capital to be subject to being shut down by some stupid mother fucking US politician......at a moments notice....

    Or at the very minimum, one takes note and diversifies themselves and their trading business.....

    What has just happened is certainly a wake up call...and would have eliminated the livlihoods of daytraders with no notice.....

    Not a cool way to spend an evening....

    Here is my personal message to the Democrats....

    FUCK YOU....FUCKING SOCIALISTS.....
    For me, my view of democrats = socialism.....

    A heinous plague to progress in business.....

    And the certain downfall of the US is guaranteed by democrats.....

    Republicans are the last hope that the US has......

    Hanging by a thread.....

    Bush has ruined it for the Republicans....and possibly for traders by his lack of good leadership.....

    This is about house prices for the masses induced by bad government policies....

    WTF do traders have to do with this?

    DEMOCRAPS....Forever FO.....
     
  359. I agree, especially if the Democrats gain power in the election.
     
  360. Before I heard of the proposed transaction tax, I thought the Democrats were by far the lesser of two evils; it's almost unbelievable how much the Republicans have fucked up this country in the past 8 years. But now, from my prospective, the Republicans are by far the lesser of two evils.
     
  361. Id love to see daytrading go bye bye.

    that would cause less volatility and less noise in the financial markets, a better trading environment.

    just a nice stable Market for sophisticated investors/traders like we had in the late 1980s to the late 1990s before all these online brokers came into existence.
     
  362. first of all you would be paying it up the ass for fills on stocks, volatility would be all over the place because of lack of liquidity. and by the way there was plenty of daytrading going on in the early 80s and especially early 90s, the avg joe just wasnt involved as much yet, the big boys still held fort in that game. average investors dont understand how the playing field has leveled to the point of getting professional executions. if you want you can go back to the old days example would be you want to buy xyz stock 1000 shares bid 48.25 ask 50.10 you take 1000 at 50.10 now your down 2k plus you paid an extra 125 on top of your brokers commission of another 200 bux. you got to remember now discount brokers are no more so were back to the wild west days of screwing the little man with crazy commissions. you see to me this is taking 8 steps back and no steps forward. i am sick and tired of fees fees and even more fees you obviously havent thought this through.
     
  363. IMHO, the last two Republicans worthy of any respect were Eisenhower and Teddy Roosevelt.

    Today's Republicans have been co-opted by the neocons, they're much more dangerous than any Democrat could ever be.
     

  364. Uhhh, why are you here?
     
  365. I wouldn't count on 4 years if Obama gets elected and the sheeple are definitely stupid enough to put him in office. The unholy trinity of Obama, Pelosi, and Reid could easily tax trades in the name of "stabilizing the markets by clamping down on speculation." Democrats never met a tax they didn't like and will come up with all kinds of new taxes to "benefit" the sheeple.
     
  366. I pray to god republicans win seats back in the house and senate this fall.

    At least we'll have some gridlock and things wont pass very easily.

    Please everyone pray with me the republicans take back control of congress if dems take the white house.


    Congress approval rating is at a historic low of around 14%. wow.
     
  367. first of all you would be paying it up the ass for fills on stocks, volatility would be all over the place because of lack of liquidity. and by the way there was plenty of daytrading going on in the early 80s and especially early 90s, the avg joe just wasnt involved as much yet, the big boys still held fort in that game. average investors dont understand how the playing field has leveled to the point of getting professional executions. if you want you can go back to the old days example would be you want to buy xyz stock 1000 shares bid 48.25 ask 50.10 you take 1000 at 50.10 now your down 2k plus you paid an extra 125 on top of your brokers commission of another 200 bux. you got to remember now discount brokers are no more so were back to the wild west days of screwing the little man with crazy commissions. you see to me this is taking 8 steps back and no steps forward. i am sick and tired of fees fees and even more fees you obviously havent thought this through.

    ...........................................................

    Exactly.....The real cost of trading was narrowed many times over because of direct access....and the NYSE/Nasdaq/MMs were pissed to no end that Joe Public could get between the bid ask without them.....
    Solely because of daytraders efforts which fought the fat boys and won because of efficiency....

    Pension plans reduced commissions paid to big firms dramatically because of what daytraders did to the fat commission and spreads game......

    The typical real cost moved down to the point that it literally changed the brokerage business forever in that there was no longer money to be made in commissions.....

    But this is how democraps think...they do not think it through....and as it turns out Bush is the best tool the democraps have to change the US into a socialist state.....

    Less is more......

    If the US were to adopt a 10% consumption tax, the tax revenue in the US would increase many times over.....

    It is the sheer stupidity just like this last commentor that would rather pay out 10x just because it makes sense to their stupid minds....

    Ok go ahead and pay 10x...

    In economics it is called snob appeal.....I want to pay 10x just because it makes me a democrap....

    This guy is a perfect example of democrap stupidity.....

    The bailout problem is a house price problem.....

    Over the years there were all sorts of housing inducements mostly organized by the democraps......and it was the greed of stupid republicans that exaggerated the problems....

    Here is the problem guys, and for simplicity we will discuss the house price as if it were a stock....

    Because of Greenspam and democrap housing policies the common joe house price got to $240.

    The idiot banks put 3 to 7% down and the price went down $70.....It is going to go down another $50....

    The real opportunity is going to be between $120 to $170.....and those that pick up the $120 have a chance....

    The sticking point here is that somebody eats the $240 vs $170....and the only way to get this back is through equity which would capitalize the $120 vs $170.....and could make the new holders some dough....

    This is what is so funny about democraps ....they want to pay 10x what is necessary while they think they are paying 1x....and want to tax 1X so that they can pay 10x....

    F'n morons.....

    Voting for a democrap is like voting for a Chavez......
     
  368. no kidding:D
     
  369. So, you also, think the markets will behave the way you want by even more regulations and the markets do not really respond to economic conditions?
     
  370. calm down, if the 16 idiots had to put it in a letter to the speaker, then those 16 are almost certainly not in on the talks of the formation of the bill in the first place so it wont make it in.
    goody789
     
  371. Shouldn't cigarettes be taxed more to help pay for this?

    Cigarettes are always the first in line for tax increases. Add in booze and we solved the problem. :p
     
  372. Just think what it's going to be like if they get a filibuster proof congress.
     
  373. Perhaps that's why the dems were so desperate to have republicans on board. If they were to go it alone, the dems might lose seats. Of course, the dems knew the republicans would lose seats if they were on board. Now that they think they have a bill, it will be interesting to see how it plays out. Who was for, and who was against? That's what I want to see.

    I hope the republicans that agreed assured there would be less idiocy in the bill.
     
  374. We need to contact Ameritrade, Scottrade, Etrade, and Schwab.

    These are brokers that have large quantities of average income "common" people with small brokerage accounts. That is who the democrats who proposed this idea must see to understand why this tax shouldn't be implemented & who will get hurt by it.

    If you have an account at any of those brokers, please call the help lines or email them with the URL to the story in the first post of this thread.

    A combined letter from all of them would be powerful. Imagine how many millions they represent.

    Remember too that a brokerage account may represent a family & not just an individual as well. A family may have a budget that puts a certain percentage of their income in a brokerage account. That multiplies the amount of people effected by this tax over the amount of accounts that exist.
     
  375. Don't forget to contact STA.

    http://www.securitytraders.org/


    Mission Statement

    The Security Traders Association is committed to promoting the interests of our members throughout the global financial markets, providing representation of these interests in the legislative, regulatory and technological processes, while fostering goodwill and high standards of integrity in accord with the Association’s founding principle, Dictum Meum Pactum – " My word is my bond ".
     
  376. shut-up you moronic douche... maybe you'd like to go back to phoning in your orders (from the YMCA) and waiting an hour or so for the call-back confirmation? or maybe a call back whenever - and you obviously never tired of taking it in the ass on fills? go to the library and look at the stock quotes from your dream decades... you're confusing a decade long uptrend in the 1990s with an orderly market. learn to play both sides of the market- moronic douche!
     
  377. LOLZ....

    As usual, you're wrong.
     
  378. More brilliant idea's from the sages of Washington, DC.

    A "Disgorgement" Recovery From Profligate CEOs: $40 Billion

    Until several weeks ago, top CEOs and managers were collecting massive salaries and fees while they told the rest of us that "everything is fine." These CEOs gorged themselves and have taken the money and run. The four biggest investment banks on Wall Street shelled out $30 billion in bonuses last year. One of them, Lehman Brothers, has just gone under. Another, Bear Stearns, was bailed out earlier this year. To help pay for recovery, the new Treasury authority should seek the payback of executive compensation inappropriately extracted in the years before the Wall Street meltdown.

    An Income Tax Surcharge on Incomes Over $5 Million: $105 Billion

    A portion of the bailout cost should be financed with an emergency income tax surcharge on incomes over $5 million. Wealthy investors have been the big winners in the unregulated bubble economy. They have watched their incomes skyrocket over the last 25 years. Meanwhile, President George W. Bush has cut their taxes for seven years. Instituting a 50 percent tax rate on income over $5 million and a 70 percent rate on income over $10 million would generate $105 billion a year until the bailout is paid for.
     
  379. "Obama said that, if elected, he would order a thorough review of the financial industry rescue plan and move to upgrade industry regulations. "

    http://www.cnbc.com/id/26923233


    Let's hope this doesn't include the transaction tax.
     
  380. Just read this on one of the latest articles..

    AP

    Congress expected to pass rescue package


    WASHINGTON - Congressional leaders and the Bush administration agreed Sunday on the main elements of a $700 billion bailout for the financial industry, paving the way for swift enactment of the largest government intervention in markets......

    Another important bargain, vital to attracting support from centrist Democrats and Republicans who are fiscal hawks, would require that financial firms repay the government for any losses. A leading proposal would impose a 2 percent tax on the companies if, after five years, the program had not made back what it spent.


    That works for me. Leave transactions out of this.
     
  381. I saw that earlier this morning and thought the same....maybe this is their alternative to total immediate financial collapse?:mad:

    btw...Barack Hussein Obama has a plan to place a Federal Ban on Concealed Carry Permits nationwide, usurping States' Rights to issue these permits in accordance with each states laws.
    I found that to be frightening in the extreme.
     
  382. class warfare is finally getting out in the open. although the WM CEO walking away with $20MM for 17 days work seems wrong - i guess you gotta try and go after the BOD. i mean, dude didnt even know his company had been snatched by FDIC and sold.

    third party, or some would say a second party:D , is gonna emerge.
     
  383. ill just say this... basically, the banks knew what they were doing. some stayed honest, but the rest were almost insane. so the banks that are getting bailed out actually originated a bunch of this sludge. the banks were the front line of originating the bad paper.
     
  384. Obama can plan that all he wants but it will never happen. But it does go to show what an extremist he is.
     
  385. So only criminals can conceal.

    Hmm, brilliant move.
     
  386. I have complete respect and absolutely agree with everything you are saying here.

    These are the facts people.
     
  387. Can you supply a link, please.
     
  388. LOL, the fools are actually trying to think this one through!?#Q!!@ - I'm shocked.

    If this is true the only people allowed to carry guns will be the POLICE ... and the thugs who rob and steal. :eek: :p
     
  389. From what I can find on the net, there seems to be no mention of a transaction tax. Looks like we dodged a bullet for the time being. Personally, I don't think it will ever happen as the lobbies from the Chicago exchanges will explain pretty well to Congress what a disaster it would be. I could see a fixed dollar transaction tax though. Say a buck per trade. This would be far higher than the current tax, and screw the high volume guys that don't pay much more than that total, but I don't believe it would collapse the industry.

    It would definitely suck however.
     
  390. never, ever assume that. once society labels you 'pariah' status (like tech workers got), unless you have someone on capital hill giving you the 'all clear', you're not, and argueably, not even then

    you wont see anywhere on the net via search engine that there was a huge guest worker bill last week

    'a huge guest worker bill during a supposed DEPRESSION?!?!?'

    yup
    - it's going to be a depression, with a 'shortage of workers'

    total scum they are

    this was sceduled for a committe vote on tuesday



    from numbersusa

    Financial Industry Collapsing -- But Some In Congress Still Trying To Give Away More US Jobs To Foreign Workers
    By Roy Beck, Updated Tuesday, September 16, 2008, 5:43 PM

    A lot of you are calling Senate offices and being told that NumbersUSA is overstating the seriousness of the crisis we have been telling you about. There is no question that the situation at this moment is confusing, and there may be nobody who understands it all. I will try to share what we know at this moment and appeal to you to keep the pressure on because I believe we remain in great danger of the Senate taking up a bill with a big surge in permanent foreign worker visas this month.

    Read Full Blog Post
     
  391. If Congress helps to <i>cause</i> the recession/depression - or helps to make it worse rather - as opposed to helping to alleviate it... who benefits? If they pass laws that will inevitably drive people out of their homes and into the poorhouse, qui bono? Anyone's thoughts?
     
  392. congress is nothing but an order taker for K street lobbyists

    a booth where they sell off pieces of the average citizen's hide to whoever wants to buy

    if that means that they will make legislation that is absurdly inconsistent, on the very same day, they couldnt care less

    last week, walls street fatcats wanted to buy a bailout - so congress shouted 'Depression imminent' to the little people

    also last week, cheap labor pushers wanted more cheap labor, so congress yells 'labor shortage!'

    your problem, is that you assume they have a shred of integrity

    they dont
     
  393. Not sure if this has been posted earlier.

    Why are they only singling traders out? What right do they have? Isn't it against the law to discriminate in this country? Why don't they go after their beloved lawyers? They have money too. What the heck, they should also target doctors, they have money.

    I mean to make it really fair, why don't they just tax fat people. They also have to have money otherwise they wouldn't be fat.

    Sad to see progressive democrats spend time in the same bed with these small minded backward thinking people.
     
  394. why are they singling individual traders out? same reason they singled tech workers out

    because they can

    i dont mean to irritate people by continually bringing that up, but i'm trying to alert people that they have to fight this with everything they have, from day one

    when this really got rolling in tech in 1998, people in tech debated this philosphically amongst themselves for years untill it became absurdly vindictive against American tech workers, where no one in tech could deny what it was really about. It was nothing but an attack, from day one. People rationalized it away as something other than what it was, while they got screwed. I saw it for what it was from the very beginning

    watch this 4 minute youtube of immigration lawyers going to insane lengths to punish American workers - people need to take 4 minutes to watch this to fully understand how bad it can get when congress has it in for you.

    (The video shows attorneys for Cohen & Grigsby, one of the largest law firms in Pittsburgh, explaining at a conference on immigration how to obey laws that require Americans be given top priority for jobs while still ensuring foreigners are hired.

    “The goal here of course is to meet the requirements, number one, but also do so as inexpensively as possible, keeping in mind our goal. And our goal is clearly not to find a qualified and interested U.S. worker,” Lawrence Lebowitz, the firm’s vice president of marketing, told the audience in May. )


    http://www.youtube.com/watch?v=TCbFEgFajGU

    and they still tried to pass a guest worker bill last week

    not to be crude folks, but this is as if you just went to prison, as someone started getting 'affectionate' toward you

    you've got to hit back with everything you got, or you will be their bitch

    I dont mean to call your reps and be obnoxious, but politiely call and make these points:

    1) It's a draconian penalty, nearly 60 fold increase of transaction fee, on a group of people who
    a) didnt cause this
    b) dont benefit from the bailout
    c) in many cases, are AGAINST the bailoutm and feel just as wronged by the bailout as everyone else

    2) It will dry up liquitity - many if not most traders feel they cannot make a profit with a 60 fold increase in transaction fee - I know I cant

    3) Item 2 means it will drop tax revenues right away - this isnt the usual 'lower taxes mean higher revenues' line, common sense tells you that such a severe increase in taxes can stop nearly any activity

    4) Farm commodies prices will swing more violently, and perhaps have a larger subsidy liability - the whole point of these exchanges was to make buying and selling more smooth and liquid - thats the only point of an exchange

    5) American firms like MERC/CME etc will be out of business and become YET ANOTHER industry driven offshore

    6) It's a capricious deprivation of a livelyhood, of people who may have entered this because they were deprived of a previous livelyhood (such as tech, in my case)
     
  395. Most importantly, politicians and the public need to understand who exactly we are.....

    In the late 90's we started direct access trading and made the markets more efficient by narrowing the spreads, and reducing the commissions via direct access technology....

    The big brokerages hated us, and tried to put us out of business....and ended up buying much of the direct access technology.

    We daytraders are responsible for replacing many of the market makers and specialists because we demanded lower costs and more efficiency....For years market makers and specialists had the easy life, until we showed up.

    It is because of us, daytraders that the market transacts cheaper for the entire public....and we have saved the big retirement plans billions in lower costs.....

    We are not part of the the larger hedge fund group that is making rumors and naked shorting stocks....

    This is the complete fault of the SEC...these types of large groupings of transactions are easy to spot, but since it is super big money doing the deed, the SEC looks the other way .....

    Look, to this day, companies like Ameritrade hate us because we demand more efficiency than they can offer us....and they hate us because we are making the market so efficient......and we are accused of making it harder for them to make a profit....

    So today, we are basically an unorganized growing group of traders that play the role of efficiency to the markets, and save every single retail trader, and every single retirement plan commission and spread costs.....

    And we get no credit for it....

    We are really doing the job of market makers that have no collusive activities as have the market makers as you may note by reviewing the many public legal cases covering these topics.....

    Furthermore we are doing this with our money, for our families.....

    So the advertising type mom and pop brokers benefit from us but hate us, because they would be snatching higher fees from their clients if we were not present....and the big brokerages have partially gone out of business because we have forced commissions down so low, as well as closing the spreads......

    This is the bottom line.......

    .........................................................

    What is true is that the bigger brokerages continue their shenanigans in excessive fees, and some of the big hedge funds are pulling naked short stunts right and left.....

    But us daytraders do not have anything to do with these people.....All we have done is to force the costs of trading securities lower....

    We also have nothing to do with bullshit educational services as these are people who are not really daytraders....

    Furthermore , there are not many of us around......
    ......................................................

    Tell you what , I would like to have some of the money that we have saved the public in both their retail and retirement accounts.....It is a very sizable amount in the billions of dollars.......

    And no, the bigger companies have even managed to buy some of the direct access technologies and have shelved it to try to harm us, but more technologies like Genesis Laser came along to replace them....

    What the US public should pray for is that there are more of us, or the large retail firms will get back to their old ways by easily charging more than 10x what is paid today......

    Now this issue of naked shorting in harmful large amounts is not our doing.....and those big hedge funds who are actually doing this need to be held to account....

    And most importantly we have absolutely nothing to do with the assets that are causing all the big problems, because we do not even have a way to trade them....

    This has to do with real estate house values ....we have nothing to do with this.....

    Furthermore we have nothing do do with the oil price spikes....Again these are the very large pools...and frankly the most harmful trading of oil is done in Brent Crude and its related unregulated market which is based in Europe and not even in the US jurisdiction....

    The spike the other day was do to one hedge fund's issues that have nothing to do with us....

    Blaming us for all this crap.....is like blaming the only black man in the neighborhood for raping the preachers daughter, when the black man was in another country.
     
  396. Sucks, doesn't it?
     
  397. Just heard Kucinich bitching about not giving the transaction tax more consideration. Fucking loser.

    God, please let all these fuckers get voted out of office. Amen. :mad:
     
  398. OK Nancy and Harry, what part of your sorry bill states that you, the congress, will end your attempts at social engineering, meddling with the markets, etc? What part of your bill holds guilty politicians accountable? None? Why am I not surprised.

    Guess I'll go read it when I can get into financialservices.house.gov/
     
  399. Does anyone have a link to the Nancy/Harry proposed bill? I don't see anything at financialservices.house.gov/
     
  400. Sight is frozen. Probably overloaded. There was another, but don't recall. Sure we'll be able to get in later.
     
  401. I found the draft here:
    http://i.cdn.turner.com/money/2008/images/09/28/ayo08c04_xml.pdf

    I don't see any provisions for "taxing the trades", but then again, it's a 110 pages document, so I may have missed it.
     
  402. well im sure a couple of days is plenty of time to research, negotiate, write and review a 110-page document with at least $700B in expenditures... either some one waited way too, or someone wants a sloppy deal quick. i mean, there are what, just shy of 600 in Congress?

    yeah, couple of days is more than enuf :eek:
     
  403. Sorry but this is not remotely like the transaction tax, you should stop mentioning it on this thread.

    *Allowing* more people to freely compete in a market is entirely different to *forcing* people to pay punitive levels of taxation. The tech worker bill increased competition and freedom, allowing firms to hire who they wanted, instead of being forcibly confined to hiring Americans. No one has a right not to be competed against - that includes US tech workers.

    An imposed tax is entirely different from free competition.
     
  404. SEC. 134. RECOUPMENT.

    Upon the expiration of the 5-year period beginning upon the date of the enactment of this Act, the Director of the Office of Management and Budget, in consultation with the Director of the Congressional Budget Office, shall submit a report to the Congress on the net amount within the Troubled Asset Relief Program under this Act. In any case where there is a shortfall, the President shall submit a legislative proposal that recoups from the financial industry an amount equal to the shortfall in order to ensure that the Troubled Asset Relief Program does not add to the deficit or national debt.





    It's not directly addressed, but obviously Congress left the door open to revisit something such as a tax down the road. Maybe a mortgage tax would be better??
     
  405. The transaction tax is not in the latest draft.
     
  406. It could still be put into place outside this bill.

    I don't want to make this a political thread, but, I fear it's going to be enacted if Obama wins in November.
     
  407. If Obama were to win, I'd feel better if the GOP took over both House and Senate to keep him in check. Man, this election is a "better of two evils" choice once again.
     
  408. This is what makes me so scared... How could there be such stupid people in charge of this country?

    If they put this tax , then overnight they would wipe out all daytrading. Fine.

    But then you would also take out most of the liquidity left in the stock market, as well as making the spreads incredibly wide.


    The exchanges would not be able to handle these sorts of volume drops and would start imploding....


    The stock market would be essentialy worth 0, and then there goes all the retirement funds invested in the market.

    Ideas just keep getting dumber and dumber.
     
  409. lol please,,,people buy things everyday n the usa and pay a tax,,when the financial market was small,,,like the internet,,no tax was understandable,,but if the financial market is so large now that it can destroy the very foundation of our country then a tax needs to be paid to uphold the USA. Anyone votes against the tax hates the USA.
     
  410. The wrong taxes make it worse....

    If you love the US.....

    Which many of us do.....

    You do things to make it better, not worse.....

    A good person can cause more harm than a crook, because of stupidity....

    Taxing securities is stupidity...

    Plain and very very simple......

    ......................................................

    The template needs to be changed...

    What would make things much better is just a 10% consumption tax....

    Tax revenues would rocket upwards....Every business of any substance would want to be in the US, and create lots of jobs....
     
  411. You've outed yourself as a TOTAL IDIOT. It's dumbasses like you who elect Congress!
     
  412. This has to be sarcasm.
     
  413. It's not. Look at his other posts.
     
  414. I see two answers. Stupid and apathetic people elect stupid leaders.

    Also, don't assume the elected "leaders" are actually looking out for your best interests, and not their own (or rather the anti-American interests of those that own the politicians.) They may know exactly how damaging to the Constitution and freedom all of their bad decisions are. Free markets, the Constitution, freedom, etc. are a hindrance to those who already pull the strings.
     
  415. With apologies to H. L. Mencken, one of his best quotes (with a little word substitution) sums up this whole issue in a sentence:

    "No one ever went bankrupt underestimating the financial illiteracy of the American public."
     
  416. So with this bailout bill not passing what does that mean for the transaction tax? I still can't fathom how this would ever see the light of day but who knows. Is the idea dead?

    -Guru
     
  417. No, I actually don't assume that they have integrity - I assume that, on the whole, they do what is most profitable to them - whatever that might be at the moment.
     
  418. This thread is dangerously close to ending up in politics.
     
  419. first of all, i'll post whatever i feel like, you're not the moderator here

    secondly, the h-1b is similar to this because it 'singles out' one group of people. in 2001, the industry actually shed jobs, with 195,000 foreign workers coming in . 9 out of 10 workers hired were h-1b

    no other occupation got this treatment - everyone thought tech workers were 'fat cats'

    there are a LOT of similarities, you're just too stupid to see it.

    this issue is the government singling out a group of people, and putting them out of business, without cause

    my point is that in the beginning, members of the targetted group will debate 'this' and reason 'that' - they underestimate what can be done to you just because you've been targetted, that some level of political power has it in for you

    that's what this is about

    in the case of tech workers, had every one of them fought back, with everything they had, it would have ended differently. but they hesitated, thinking 'reason will prevail'. that they were 'above' politics, because they had it all figured out. they didnt and got creamed
     
  420. I hope it's dead but this has become so political and detached from reality that unless the exact same plan gets voted on again, it's possible that pandering politicians would add it to make the overall bill more palatable to the sheeple... it could be done in the name of recovering fees from "Wall Street," to punish speculators, and reduce volatility.
     
  421. WA State has a tax when you sell a piece of real estate. it was like 1% or 2% - i forget what they called it.
     
  422. That is an absolute fact. I can't tell you how many reasobably intelligent people that I know who watch idiotic reality shows or sports every single night on TV, yet are too bothered to educate themselves on the main issues of the day.

    And many of these people vote!
     
  423. Very true.
    On a similar note, there are ECONOMISTS from academia that are advising the likes of Reps. DeFazio and Pete Stark who are part of this "Transaction Tax".

    I had one of their assistants return my phone call of last week, earlier today, and she said we need a REVENUE RAISER to PAY for this "bail-out". She kept on harping how the $700 Billion was going to be paid for, and she also mentioned that London already has a "transaction-tax" thus this would be no big deal for the United States market place.

    Her initial logic started out saying that short-term trading is not "healthy" for the markets, and then concluded by saying "how are we gonna pay for the $700 Billion?"

    I asked her why you would want to TAX investors/speculators that have been trading on SEC/CFTC regulated exchanges ( as opposed to mortgage backed securities and credit default swaps that trade OTC ). ?

    She didn't have any other answer but to say that "those agencies haven't done a very good job, now have they?"

    How absurd.
    It's all about "class-warfare" with these idiots and not about whether or not such a proposal actually has MERIT!
     
  424. this isnt even about class warfare - many daytraders would qualify as 'middle class'

    no, this is about scapegoating

    somebody has to PAY for what happened!

    even if they are innocent
     
  425. Representative Joe Barton on CNBC just said the Democrats have the transaction tax proposal on the table.

    It's being considered again.


    How is this idea going to be stopped in November if there's a Democratic President who will go along with the Democratic Congress???
     
  426. It's not going to be stopped now, if they can get the votes. It's not like Bush will veto this bill if there is a transaction tax.
     
  427. No, don't let them fool you. EVERYTHING the Dems do revolves around wealth redistribution or "class warefare" or whatever term you want to use. At the end of the day, these people despise free markets and captitalism.

    They even know that capitalism works, but can't stand the fact that some people are better, smarter, work harder, etc compared with others.
     
  428. Whats wrong with sports?
     
  429. If all the futures contracts decided because of this to start exchanging on a foreign exchange that would give other countries a *great* opportunity to push for all those commodities to be exchanged in something other than the dollar. I don't know it just seems like other countries are way too eager to do it anyway, this could push them over the edge.
     
  430. Who thinks that the bitches rant against Bush and the Republicans was accidental?Drag it out. Drag it out until we get a 100% Democrap bill.
     
  431. Is it time to throw out a solution that would still raise a lot of capital but not totally shut us down (along with a ton of online brokerages and who knows what else!), it would still be harmful but not as harmful for a lot of us? I really think increasing the short-term capital gains rate would raise a lot of money, too, along with doing away with the 60/40 futures treatment. I think if you concentrated on the fact that by driving business away from our exchange, it could do serious damage to the desirability of the dollar, and I'm not just talking its value, I'm talking people wanting to have it in their reserves, you might get someone to listen. Having an alternate solution would get them to listen a little harder.
     
  432. All traders could stop trading for a whole day to protest this move.

    I wonder how this would affect the markets. A trader's strike.
     
  433. I still say there is no way they actually impose this transaction tax. This would basically wipeout an entire industry (brokereage) overnight IMHO. Spreads would widen, liquidity would dry up, etc.

    Let's just hope that someone takes one for the team and steps up and stops this madness...

    Wake up politicians...

    -Guru
     
  434. 10's of millions of americans trade 5 times are more a month. it would hurt millions. here's a piece i found on the indian transaction tax from 2004 article. apparantly its used to stop the flow of speculative money.


    The Rationale

    There are several justifications for the adoption of STT in the Indian financial markets.

    First, the underlying logic of securities transaction tax is to slow down the flow of speculative money, as it would be taxed each time a transaction takes place. The STT is expected to curb purely short-term speculation by day traders, “noise traders,” arbitrageurs and big operators without significantly affecting the long-term investors. The tax on equities held for a long period would be marginal while the tax on short-term trading would be higher. The STT would be a significant deterrent to speculators and day traders trying to make a quick profit on a huge sum by just trading, without taking any deliveries of stocks. The proposed tax would keep such players away, as they would have to factor in the tax cost.

    The STT is expected to reduce the speculation in Indian financial markets, which are amongst the most speculative markets in the world. Compared with several leading international financial markets, the sheer volume of speculative trading in Indian markets is extremely high. It has been pointed out that Indian financial markets are second only to NASDAQ in speculation, thereby surpassing some of the leading international financial markets such as the New York Stock Exchange (NYSE), London Stock Exchange, and markets in Hong Kong, Singapore and Japan (2). Despite a sharp increase in the daily turnover in the Indian financial markets, actual deliveries are less than 20 per cent of trading. Due to excessive speculation, much of trading in the Indian markets is concentrated in a handful of stocks. The top 10 stocks account for over 80 per cent of the turnover of the Indian financial markets. The top 100 stocks account for almost 99 per cent of the turnover. While there are several thousand stocks listed in the markets that are not traded at all.

    The speculative nature of Indian financial markets can also be gauged from the fact that the volume of secondary market trading has increased several times while new capital raised through primary market has significantly declined over the years. As rightly pointed out by L C Gupta, former member of SEBI, the high volume of speculative trading has not helped even a bit in strengthening the market's capital raising function, rather it had the opposite effect (3).

    Over the years, we have witnessed that excessive speculative trading by big players more often than not degenerates into market manipulation. There is an entire history of frauds in the financial markets starting from the securities scam of 1992. The financial frauds recurring at regular intervals reveal that our financial markets are prone to abuse, manipulation and excessive speculation.

    India has also the distinction of having extreme price volatility at the individual stock level. Short-term trading is one of the major factors responsible for increased market volatility. The financial literature suggests that transaction taxes increase asset price efficiency by curbing excessive volatility. By raising the cost of speculative trading, STT would contribute towards restraining short-term trading, thereby making Indian financial markets less volatile and more efficient. In the present times, the stability in financial markets is of utmost importance because the Indian policy makers are determined to invest pension funds in the financial markets. As any negative development in the financial markets can adversely affect savings, investments, exchange rates and interest rates, it is high time that financial stability should also be treated as a public good.

    Second, the revenue potential of a 0.15 per cent of STT provides another justification. On an average, the daily trading in the Indian stock markets is about Rs 100000 million. By imposing a 0.15 per cent STT on this volume, the Indian tax authorities can collect Rs 150 million every day. As Indian financial markets operate on an average 250 days a year, STT could generate revenue of Rs 37500 million every year. This is a substantial amount in the present times when country is finding it difficult to raise revenues through taxation. India's tax-GDP ratio is among the lowest in the world and has fallen particularly in the 1990s - the decade of economic liberalization and globalization.
     
  435. my worst fear when the bill was defeated, is that it would be back with the transaction tax

    whenever a badl bill comes back for round 2, often the 'compromises' make the bill even worse
     
  436. Just come back with the same fukin bill... it'll pass
     
  437. exactly my fears as well...
     
  438. Nothing. I'm a huge football fan. But, I also make sure I'm up to speed on financial issues, geo politics, US politics, etc.

    As you probably know, there are many people that really are clueless about all of those things, they have no idea of what XYZ politician's views on the issues are or what the ramifications of their views are, yet still vote.
     
  439. my fear is the transaction tax will come back as part of a wall street reform package 6 months from now.
     
  440. my fear is that it will be part of a bill that passes this week
     
  441. .. we can all discuss our fears with our mommy's and daddy's... if people are just going to whine and complain in this thread, then what do you think you're accomplishing? Call your congressmen... take action.. don't just sit ideally by and complain
     
  442. go fuck yourself

    nobody's forcing you to read it

    odd that those who complain about complainers dont see themselves as complainers
     
  443. Has anybody heard Pelosi or Barney Frank mention this dreaded transaction tax? Everything I've read regarding the new improved bailout has not mentioned a transaction tax at all. Now if Pelosi or Frank were to mention this I would be really worried...

    -Guru
     
  444. No, how about you go fuck yourself and grow up. All successful traders need this to NOT BE A PART OF THE PLAN so do your fucking part and call in and write in and grow up, kid.
     
  445. The transaction tax would probably create too much controversy to push the bill through as quickly as they would like.
     
  446. How the fuck do you know that the people participating in this thread haven't called/emailed their congressmen? I have and I'm particpating in the thread.

    Get over yourself.
     
  447. the transaction tax has ways around it, in london the stamp tax which is even more than the imposed tax rate here in the us would be is a non issue if you are a member of the london stock exchange, the same would be true here in the states, the nyse cme would be giving away exchange status to traders like it was candy if this law passes. exchange members would be exempt otherwise this country would lose 10x the amount of income tax from these companies if they didnt make them exempt from this tax
     
  448. I never said people weren't acting, although I'm sure many that are writing in this thread are not. All I'm saying is we have to make our voices heard to the people that are in power and don't have a clue what they are talking about. Discussing how incredibly stupid this idea would be amongst a group that is intelligent enough to already understand the financial ramifications may help us let out some steam, but it does not help fight this. I am not attacking anyone, I am simply urging anyone that has not acted, to ACT, this is important.
     
  449. " I am not attacking anyone"

    bullshit
     
  450. Thanks for the ray of hope. Hopefully things won't come to that.

    Someone needs to point out to the congressmen proposing this tax that the speculation and trading which caused this crisis was that of the murky UNREGULATED mortgage and credit derivitives markets, NOT the HIGHLY REGULATED and transparent trading of the equities and futures markets.

    Independent traders had nothing to do with FNM and FRE, BSC, LEH, and AIG leveraging themselves into oblivion to the point of insolvency. Independent traders had nothing to do with credit freezing up so that companies (supposedly) can't borrow the money they need to make payroll. Sure traders are there shorting the stocks as these companies blow themselves up ... always have been and always will/should be. In doing so, the public is alerted to get the hell out, i.e. when they see the stock of a company whose CEO says everything's fine plunging due to these "speculators".

    As I see it, with this tax they're essentially trying to shoot the messengers.
     
  451. That's one of the things that really pisses me off about this. They want to tax transactions to punish the people responsible for the mess, but then exempt the people who *are* actually responsible. That leaves... us.
     
  452. Anyone know if they tacked on the Pelosi/Obama transaction tax in the latest revisions?
     
  453. To those arguing, we are all in this together. It is easy for emotions to get high. Lets keep a level head. Yes, we need to contact our representatives and senators. But we also need to discuss and provide updates if any. Thanks for all efforts.
     
  454. i agree and the funny thing is that the whole beef with all of this is who is gonna pay for this, politicians say we dont want the tax payers to pay for this mess it should come out of wall streets pockets, then you got some jag off democrat coming out and saying lets tax every transaction that joe public makes on a securities transaction. to me it seems like these politicans are like the blind leading the blind, dumb and dumber, i feel embarrassed that i have to subject myself from reading such bullshit and hypocrasy, where is montgomery brewster when you need em. NONE OF THE ABOVE NONE OF THE ABOVE he pegged politicians right on. i think these politicians have to rent brewsters millions and listen how the public perceives these momos.
     
  455. According to an Obama stump speech today in Nev., he says:

    "And if we do have losses, I’ve proposed to institute a Financial Stability Fee on the entire financial services industry so that Wall Street foots the bill – not the American taxpayer. I’ve also said that if I’m President, I will review the entire plan on the day I take office to make sure that it is working to save our economy and that you are getting your money back. (full transcript of speech)

    So my belief is that it will not show up on the bill presented now, but be ready for it as soon as Jan/Feb if "President Obama" has his way. In the meantime, keep bugging your Representatives and Senators, like seaside says.
     
  456. Since when did reality have anything to do with this? It's politics and this tax could easily be included in the name of "protecting" the sheeple by recovering fees from "Wall Street," hobbling speculators, and reducing volatility.

    The root cause of this mess is "the consumer's" sense of entitlement and addiction to spending more money than they have. The gov't, banks, etc. all enabled and catered to this because it benefited them at the time, but how often do you hear politicians talk about sheeple living beyond their means? So don't expect logic to prevail with a transaction tax. In the end it will come down to politics.
     
  457. I had a feeling this was coming. Here it is, and it even has a catchy title:
    "No BAILOUTS Act" (Bringing Accountability, Increased Liquidity, Oversight, and Upholding Taxpayer Security). So the transaction tax will increase liquidity? As I said politics has nothing to do with reality.

    http://www.thenation.com/blogs/thebeat/366595/the_no_bailouts_act
     
  458. Well I don't think there's time to craft a new bill. It looks like the Senate is set to vote on a revised bill on Wednesday so that should be interesting (esp if Obama and Biden vote for it). It sounds like the new bill includes some new tax breaks that should appeal to the republicans (I see no mention of a transaction tax) - let's keep it that way:)

    -Guru
     
  459. Reading the article, then, is this a transaction tax or a profit tax?

    the measure would impose a securities tax equivalent to one quarter of one percent of profits
     
  460. CALL YOUR STOCK BROKERS PEOPLE!!! DO IT NOW!!! WE NEED TO CONTACT SCHWAB, AMERITRADE, FIDELITY, ETRADE, AND OTHER BROKERS WITH LARGE CUSTOMER BASES TO HAVE THEM TELL DEFAZIO & HIS GROUP JUST HOW MANY AMERICANS HAVE STOCK TRADING ACCOUNTS.
     
  461. Among the group’s proposals is a security transfer tax, similar to the one used from 1914 to 1966, which helped fund reconstruction projects during the Great Depression.

    He estimates this tax, at 0.25%, would raise $150 billion a year.

    This way, investors will pay for the bailout “in tiny, tiny increments,” Mr. Defazio said


    http://www.investmentnews.com/apps/pbcs.dll/article?AID=/20080930/REG/809309958
     
  462. "Democrats will shortly become stewards not just of a temporary bailout but of a long term recovery strategy. They might as well begin by pointing us on the right path. That includes direct refinancing for homeowners, direct government involvement in the management of failing financial institutions that are recapitalized by government money, through something like the Reconstruction Finance Corporations of the Roosevelt era; and a transfer tax on stock and bond transactions, both to raise needed revenue and to damp down the kind of speculation that led to the meltdown."

    http://www.prospect.org/cs/articles?article=learning_from_1929
     
  463. Okay guys, sample email to use for brokerages to email their investor relations department. Not pretty or fancy but at least now even the lazy of us can do it!

    --------------------------------

    What is being done by [insert broker name] and other brokers to combat the transaction fee now being pushed by Congressman DeFazio (D-Oregon) to be included in the bailout bill of .25% of every transaction? This is going to kill a lot of business. You brokerages are some of the best entities to fight it.

    There is beginning to be a greater and greater possibility it will pass:

    Here is an excerpt from this article [please put link back together before emailing] http: //www.investmentnews.com/apps/pbcs.dll/article? AID=/20080930/REG/809309958

    Among the group’s proposals is a security transfer tax, similar to the one used from 1914 to 1966, which helped fund reconstruction projects during the Great Depression.

    He estimates this tax, at 0.25%, would raise $150 billion a year.

    This way, investors will pay for the bailout “in tiny, tiny increments,” Mr. Defazio said. Also, the group believes changing the SEC’s fair value accounting program would go a long way to easing the credit crunch that banks are facing.

    Sincerely,
    [insert your name here]
     
  464. Thanks for pointing that out... when I first read the article, my mind converted it to .25% of the transaction amount lol... this would be even more of a bureaucratic nightmare to implement but easier to stomach.

    This doesn't mention it at all:
    http://www.defazio.house.gov/index.php?option=content&task=view&id=441
     
  465. If the proposal is just for a tax on profits then that's manageable obviously.
     
  466. Unless you're Jack Hershey in which case it would be trillions of $.
     
  467. Hmmm, interesting. I'm still thinking it's on the transaction and the articles got it wrong, though, since that's what his original letter said and I don't see how it being on the profits is much different than raising the capital gains tax?
     
  468. I'm thinking the article misunderstood it.. to just tax on the profits would be just a simple addition to the cap gains tax or income tax for short term traders
     
  469. Absolutely... hopefully this means the transaction tax was just a non-starter and this is the best he could come up with
     
  470. why would one put a tax on stocks when they're in a huge bear mkt? you add taxes when things are good. its like pouring salt in a wound. lets say avg person on here trades 300k of stock a day. thats only arounf 10k shares a day. at .25% thats $750 a day in taxes. lol 99.9% of this board will be ex traders in hours
     
  471. Okay, this article quotes DeFazio directly, I don't think he'll be dropping this. Email your own representative, I think, and stress to them the impact this can have on jobs and the dollar. I think emailing DeFazio is most likely falling on deaf ears.

    http://www.registerguard.com/web/search/131419//story.csp

    Excerpt:

    “I think it’s too risky to play Russian roulette with the fragile structure of the American economy,” said Scott Bart lett, a former local Democratic Party chairman and member of the Lane County Budget Committee. “Yes, Wall Street created this problem, but it doesn’t mean we should just ignore it.

    “This is really destroying the entire credit market,” he said.

    DeFazio said he lobbied for a 0.025 percent securities transfer tax to be added to the bill to protect taxpayers, but was ignored. A securities transfer tax, DeFazio said, would have a negligible impact on the average investor and provide a disincentive to high volume, speculative short-term traders.

    The United States has had a similar tax in the past, DeFazio said. Such a tax would not put U.S. markets at a competitive disadvantage, he added, noting that the United Kingdom has a financial transaction tax of 0.5 percent, as do many other exchanges.

    “That would be the only way to get my vote for a proposal that I don’t think will work,” DeFazio said.
     
  472. .025% or .25%??
     
  473. The difference between 0.025% and .25% is huge.. it would still suck but at least somewhat manageable at .025%
     
  474. I think .25%, that article is the only one I've ever seen with .025%. I think the journalist just got his decimal point in the wrong place.

    This is from the original letter DeFazio wrote to his colleagues (I posted earlier in the thread) when the idea was first floating around, so it's straight from him at .25%:

    ----

    This transfer tax would be on the sale and purchase of stock and more
    exotic transactions such as credit default swaps, options, and futures.
    A quarter percent (0.25%) tax on financial transactions could raise
    approximately $150 billion a year.
     
  475. China canceled their transaction tax on buying...

    http://daily.iflove.com/bizchina/2008-09/18/content_7039355.htm


    Many in the UK are trying to abolish it.

    (copied from another source)

    Research conducted by independent consultants, such as Charles River Associates, suggested that if the chancellor chose to abolish the tax, such a move would be revenue neutral, or even beneficial for the economy, because it would bring other tax gains to the Exchequer, a fact that Mr Brown has seemingly chosen to ignore. The Charles River findings suggested that the knock-on effects of stamp duty abolition would be that:

    * Enhanced share values would provide an initial increase in Capital Gains Tax revenues of approximately £6 billion;
    * The volume of UK companies' shares traded on the London Stock Exchange would increase by around 40%;
    * Income and Corporation tax revenues would increase significantly;
    * The FTSE All-share index would increase by up to 5%;
    * There would be overall net efficiency gains to the economy of around £3 billion.
     

  476. That's a terrific find, this is something that should be sent to DeFazio and other supporters of this
     
  477. freakin black boxes throwing out 100's of millions of shares a day are causing a lot of the problems. they're going to screw it up for all of us. they need to have some type of fee's for using automation.
     
  478. Black Boxes would be murdered with just a .025% tax...
     
  479. Oh my, this just gets better and better :eek:

    http://www.oregonlive.com/politics/oregonian/index.ssf?/base/news/1222827925297110.xml&coll=7

    ----------------

    Excerpt:

    DeFazio said the plan could be executed quickly and would have an almost immediate positive effect on the markets. That would buy time to devise fixes for the economy's underlying problems.

    Among the proposals:

    [cut out some stuff]

    Ban short-selling of stocks, the complicated and highly speculative practice of "selling" stock at a lower price before actually taking ownership.

    [cut some stuff out]

    "If they do that without a real pay-for, I think there will still be problems in the House," DeFazio said.

    DeFazio and other critics insist that, to protect taxpayers, any big bailout needs to be financed with a surcharge or tax on traders.
     
  480. One positive I'm seeing is that in the most recent reports the transaction tax hasn't been directly stated
     
  481. It is mentioned here:
    http://www.defazio.house.gov/index.php?option=content&task=view&id=438

    excerpt:
    If Democrats continue to back the basic questionable premise of the Bush/Paulson bailout, then we must pay for it. The $700 billion is to protect Wall Street investors, therefore the same Wall Street investors should pay for this infusion of taxpayer money. I have proposed a minimal securities transfer tax of ¼ of one percent. A securities transfer tax would have a negligible impact on the average investor and provide a disincentive to short-term traders. Similar tax proposals have been supported by many esteemed economists such as Larry Summers, John Maynard Keynes and Nobel prize winners Joseph Stiglitz and James Tobin.


    There is considerable precedent for this. The United States had a similar tax from 1914 to 1966. The Revenue Act of 1914 levied 7a 0.2% tax on all sales or transfers of stock. In 1932, Congress more than doubled the tax to help finance various programs during the Great Depression. In 1987, Speaker of the House Jim Wright offered his support for a financial transaction tax. And today the UK has a modest financial transaction tax of 0.5 percent.
     
  482. That is from 4 days ago, and things are changing very quickly and based on the most recent proposals from dickhead DeFazio, it seems he may be moving onto other things, other than the 0.25% tax
     
  483. I am a bit surprised no one has brought up how much income tax revenue the govt would lose from individual traders forced out of trading as well as from the corporations generating much less revenue. You can bet that 150 billion they project is based on current volume and not on the ~20 % that would remain after such a bill was enacted. You kill the vol and that 35% coming from goldman and all the other players is going to dwindle to peanuts.
     
  484. No one in congress? It's been mentioned many times here. That's the problem with all this. Traders and finance people understand how bad an idea this is.. unfortunately those in power do not.
     
  485. don't shoot me for thinking this out loud, but is there any chance that a transaction based fee would help wash institutional black box and quant strategies out of the market, taking us slightly back in time towards intraday mkt conditions resembling ~5 years ago?

    as it stands right now, commission structures are a regressive force against the small player. the larger you are, the less you pay, the faster/more you can trade, less movement to show profit, etc.

    could something like this actually tilt the intraday back towards real flow and less bot noise?

    or would it just kill listed mkts and move the entire thing otc..

    if it applied equally to otc and listed, it might just move everyone to slightly longer timeframes (assuming it's transaction based and not profit based. also assuming it applied equally to ALL participants/sizes/orders/etc)
     
  486. There was a paper I posted earlier where it had derived the $150 billion. I still haven't had time to read it (husband is out of town this week and I have two kids...). I know at least one person read it, though. Can anyone shed some light?
     
  487. I just think such a high % tax on the full value of the trade would make it incredibly difficult for most traders to make money. Even if you can make money, the liquidity would dry up, spreads would widen and it would make it very difficult to make money.
     
  488. i agree with everything above. seems to me if it's a per transaction "tax" as a % of profit it would hurt everyone equally. but if it's a fixed amount per transaction "fee" applied uniformly, it might actually flush out a little bit of the toughest competition. everyone would have to increase timeframe and high freq bots would thin out.

    or would it be the same shit market just with super wide spreads. dunno. probably would be.

    an analogy might be the way markets trade pit vs after going electronic
     
  489. Of course you can still make money.. It just won't be on the american exchanges. At least we can be thankful we live in the electronic age where its not that hard to trade the european or asian markets. We are small peanuts.. but think about the boom for hedge funds that will flee to tax free markets.

    It looks like the Obama/Pelosi transaction tax will become a reality sooner or later (in one form or the other).. Just start trading overseas.. I know i will.
     
  490. if they decide to do this, a fixed per-trade fee is far preferable to a per-trade % of profit tax. imo

    the more i think about it, i'm starting to like the fixed fee idea assuming it would apply to dark pools, otc, etc - not just listed, and with no institutional or size based loopholes. who knows.... every once in a while there are cold days in hell..
     
  491. My worry is the dollar. At some point, we're going to push the world too far and lose our status as its reserve currency. The lawmakers aren't even looking at that. If countries have one less reason to have all those dollars and treasury bills/bonds sitting there, they just might start cashing them in for something different.

    I mean, come on, we've already pissed them off enough and our growth is declining so they won't be able to sell as many gadgets here anyway.

    Wish I'd start worrying about the dollar a few years ago though :p
     
  492. '

    Everyone will be paying far more that simply a fixed fee.. Try getting in and out of a fast market when there is nobody on the other side to assume the risk. This is not about weeding out the competition.. Liquidity effects all of us.
     
  493. sorry i went back and edited my last few posts while u were replying to flesh out the way i'm looking at it

    there are surely lots of approaches. personally my most consistent years and gains were in immature and illiquid markets. i definitely prefer 'flow' to 'bots' if i may generalize. it may be wishful thinking though to think a fixed fee would reproduce immature, low leverage mkt conditions
     
  494. -- I wrote to my representative --

    Thank you for voting against the bailout.

    As for this "transaction tax" being proposed by Rep. Peter DeFazio, D-Ore ...

    Defazio is making a serious error to estimate the tax would generate $150 billion a year. In reality, the tax would put most traders and hedge funds out of business, resulting in 80-90% fewer stock market transactions, and very little tax collected.

    A "transaction tax" would simply favor long term investment over short term investment. The famous mortgage backed securities were LONG TERM investments. At the time, the profit margins were high enough that a transaction tax would not have deterred these reckless investments.
     
  495. You guys have been under attack for years, this really should not surprise you much.



    LOL, yeah ok, the markets (or whatever u can call US equity BS nowdays) won't miss you.

    Decades ago, the only traders were a select group of individuals who essentially fleeced the investors. I'm sure the same situation is preferred by a small select group.
     
  496. <i>Of course you can still make money.. It just won't be on the american exchanges. At least we can be thankful we live in the electronic age where its not that hard to trade the european or asian markets. </I>

    Does anyone know if there are other exchanges that don't have a transaction tax? For example, this DeFazio guy has made the argument that the exchange in the UK already has a transaction tax.

    Also, if you go to foreign exchanges, there are not as many stocks to trade as there are in the US market. For example, the UK only has perhaps 1500 stocks while the US has at least 5 times that.
     
  497. That transaction tax makes it near impossible for a retail trader to day-trade. But registered brokers are exempt from it, so firms like Swift and Title got the setup where it allows their guys to daytrade it.
     
  498. Does this only affect equities and related instruments? So equity, equity options and equity index futures/options?

    What about treasury futures and commodities?
     
  499. the revenue from increased cigarette taxes is already budgeted in most states. As the cost forces people to quit, the requirement for those tax revenues remain. Now, who do you think will pay that bill? This is not an argument for or against cigarettes, but an analogy of the "expected" taxes imposed on "those who deserve it".

    Same shit, different day. We elect lawyers, we get lawyers.
     
  500. the transfer tax will, "... damp down the kind of speculation that led to the meltdown."

    The 1914 to 1966 transfer tax did nothing to stop the 1929 crash.

    If they really want to increase tax revenue, lower the capital gains rate.


    Intentional crisis creation. If the tax returns, how will the brokerages be bailed out as trading will plummet? Money flowing out of the country...


    Very interesting that businesses and individuals that act responsibly, save and invest their money as they wish - short or long term trades, long or short - are the ones being punished, whereas those that go into excessive debt or take position of extremely absurd risk are bailed out and made to look like victims.
     
  501. Why do you think firms like Swift and Title would be exempt?
     
  502. Dems think more taxes are the solution to everything. If Obama is elected, imagine what he could do in concert with Pelosi and Reid.
     
  503. Read what I wrote. They did the paperwork needed to qualify for broker/dealer status with the exchanges. There is a capital requirement also.
     
  504. Where are all of the libs on this board? I've never seen them shy away from injecting their leftist views on this board before.

    I suspect most of them are so young (libs on this board), they had no idea what the Democratic party was truly all about.
     
  505. I saw DeFazio on CNBC early this morning...man oh man..if I looked like that I'd hate the world too!
    I might not be much to look at, but he's fugly.:D
     
  506. Did the transaction tax come up? If so, what was said?
     
  507. Nope, everything I'm reading says stocks, options, and futures.
     
  508. I understand that, but are you certain broker/dealers will be exempt?
     
  509. I'm still hopeful that we're in the clear on this one. Everything I've read regarding the bill the senate is going to vote on tonight makes no mention of the trans tax. Have they released the text of the new bill yet?

    -Guru
     
  510. Yes, when I was looking into trading LSE years ago, I did some checking into why NYC prop firms would not trade this market when it was (maybe still is) quite lucrative in comparison to the US equity markets. The tax on the trades is what kept them out.

    Title & Swift have the registration needed to make LSE viable for daytrading.
     
  511. Here are two things I think we need to emphasize.

    If they want to "punish the people responsible" there are better, more direct ways to do it, and there would be many negatives to the transaction tax, including:

    -It unfairly punishes retail investors, who had no part in creating this crisis.

    -It would destroy liquidity in the markets, which is supposedly what the bailout is supposed to fix.

    -It would drive capitol out of the country.

    "Stock speculators", short-term or long-term, long or short, were not responsible for the crisis, It was caused by:

    -The Fed holding interest rates too low.

    -Bad loans allowed by deregulation.

    -Arcane derivatives based on those loans.

    -Massive leverage used by investment companies trading in those derivatives.
     
  512. I vote Democrat most of the time. I have always felt that a middle ground between Republican and Democrat fiscal and economic policy is the best. I don't mind paying more income tax under a dem administration but this trans tax is clearly bad for traders (me) and the markets. If the Republican party wasn't hijacked by the religious right (see Palin), over run with bigots, and had a cleaner environmental/energy policy I might consider voting for them.

    This trans tax idea really is horrible though. Hope it fails.
     
  513. Actually, it was really just caused by two things:

    1) the FED and artificial interest rates.

    2) extremely loose lending, which wasn't even a deregulation issue. It was mainly just lenders changing their risk tolerance cause they believed they couldn't lose.

    I don't believe Wall St is overly culpable in this as all they did was invest too heavily in these crappy securities. They've been leveraged to the hilt in other areas throughout time (FX being a biggy, and junk bonds in the 80's). Although being that leveraged is stupid, I don't put the blame with them for two reasons.First, they were not the ones that caused these securities to turn to shit. Blame the FED for that one more than anyone else. More importantly, someone had to buy these bundled securities, and there were so many of them that Wall St was really the only place they could go. The problem is that too many were created in the first place. Too many people were encouraged to buy homes that they should not have.

    That said, I do not believe Wall St deserves a public bailout. Kill mark to market, and give them low interest loans. That will release hundreds of billions, and immediately improve balance sheets dramatically.
     
  514. I feel your pain. I don't see eye to eye with the Republicans much of the time either, although I would disagree with your point about religious bigots. Anyway, I usually vote Republican as a "lesser of two evils" kind of thing. I just happen to place individual freedom and responsibility as my #1 issue, which the Dems tend to be against most of the time.

    If the Republicans would get back to conservatism, at least on economic and foreign policy issues, I would be much happier. Unfortunately, economically they are about as bad as Dems, spending way more than they should and proposing borrowing, rather than taxation as the means to do so.

    At the end of the day, economic prosperity is the key issue and I believe that low taxes, less government intrusion, lower spending, individual freedom, etc are the best paths towards prosperity.
     
  515. I didn't see every second of the interview, but he didn't mention it.
     
  516. the article does make a case for bringing back the tax but if you read towards the end of the article common sense prevails by stating this tax would stop evolution and efficiency bascially taking backward steps. the cost of doing business in the us would become more expensive, off shore business would grow thus taking productivity out of the us.

    if short term trading is so bad for pricing how come the markets did rally over the last few years during the major bull run. bottom line is earnings drive markets and they drive it both ways, specualtors are not gonna get in front of a moving train and be able to stop it.
     
  517. The fact is, ANY tax, is redirecting money from "the people" (including private enteprise) and giving it to the government. Money isn't just created out of thin air, so it is taken out of the economy and put into the hand of the politicians in this case.

    SOME of that money will be used to benefit "the people", but much of it will be wasted, as we've seen before with government spending. So, if you believe that the government is a better steward for money than you or I, then you should be favorable to tax increases.

    I happen to believe that 95% of the time, you and I are better stewards of our own money than the goverment would be, so I am against tax increases.

    The only tax increase that I would be happy to pay, would be to directly pay down our national debt, but obviously that is just a fantasy that will never happen.
     
  518. I believe that our debt problem will be such a burden that when the republicans arise again (they are dead now), they will go back to fiscal conservatism, and really practice it this time. If not, a third party with fiscal responsibility, but moderation in taxation as their central platform will arise.
     
  519. Too bad we'll have to go through "financial annihilation" first...
     
  520. I agree that they are pretty dead right now, due to getting away from what makes them attrative in the first place. Reps. that are Dem-lite's will never be around long. They just can't out-Democrat a Democrat at the end of the day.

    BUT, if they get back on point, they will certainly emerge once again.

    Recently we've seen a few signs of life out of them, bucking the Bush/quasi-socialist agenda and getting back to basics.

    I feel like long-term, maybe the best thing that can happen to Republicans is for Obama to win and the Dems to continue to control both houses.

    After a few years of Obama with a Dem congress, and spending, tax and debt out of control, the country will be ripe for a conservative revolution.
     
  521. From my understanding, it's not in the Senate's bill. This is just something that DeFazio is pushing in the House. If the Senate bill passes through the House, then I think we're in the clear for now. I don't think the House will decide to vote down the bill again after the flood of calls after the first time they voted it down. But, who knows for sure. I think it's probably just for show right now by DeFazio and his group to show constituents they're being as tough.
     
  522. Ironic considering that the reason many of them voted it down the first time were calls from constituents saying they hated the bailout plan. All the press was saying people opposed this crappy bill 100:1 or even 300:1. I don't see that ratio changing in 3-5 days. Whoever passes this bill has a big label on their forehead saying "VOTE ME OUT OF OFFICE NOW."
     
  523. Obama spoke of the trading tax Tuesday. He put it in the context of being further down the line if the taxpayer does not recoup the investment in the bailout...
     
  524. We had a transaction tax in France as well( "l'impot de bourse" ). That was one of the reason I began trading the US Futures market in 2005... Sarko supressed it as soon as he came in office I think. Now, the french market is more viable although commissions remains high...

    One of the most scary thing in this thread is Obama's speech, the guy just doesn't know what would be the consequences( although from Chicago ), and he seems to be focused on making "Wall Street pay for its abuses"...

    If Obama is elected and institute this crappy tax, I will have to move to eurex or LIFFE, and probably wait a long time to get my consistency back on new products... It would be awful.
     
  525. Is there any research on the effect to mutual fund returns if paying a transaction tax? Maybe only a 1/2 to 2% loss against annual returns, depending on how much they churn the portfolio, but considering how poorly 401k's can keep up with inflation, that would be a killer for most folks.

    I suspect DeFazio is using the tax as an election gimmick, knowing it will never get put into the bill. He and his associates can claim trying to protect main street without worrying what such a tax could do the stock market. I can't see anyone really risking such a tax while the markets are crashing, especially this close to election day.
     
  526. This is the stupidest idea ever.
     
  527. Honestly, and I'm not making a political point here, just a clarification.. Once I realized that Obama's church is Marxist Liberation Theology and his politics is Marxist, everything he says now seems to come from that context, he does not like Capitalism or care about any speculators or small business people..
     
  528. fucking morons. I don't see anything like this in the final bill they're supposed to vote on today, but it's just the sort of idiocy only a Washington asshole could dream up.
     
  529. One of the commentators on Fox Business said that the draft of the bill is now 450 pages long. Are we absolutely certain that the transition tax isn't in there? That seems pretty crazy for it to jump to 450 pages (if thats true)...

    -Guru
     
  530. Yeah, well small businesses mean that that the plebes get to decide what to do for themselves. No five year plans. No "voluntary" national service. No detailed control of where people work, live, what they eat, how many kids they could have. Obama doesn't like that. How could he have any real power if you get any choices? Actually, nobody in Washington likes either your freedom or the constitution very much as it all limits the power of those halfwits.
     
  531. I actually believe this will happen. Unless some dirt comes out on Obama in the next few weeks, its looking like he is going to pull out the squeaker. It is possible he won't spend as much, and tax as much as everyone fears, but nothing he has said or voted for so far supports this. A higher tax on the job creators (most small businesses that employ over 5 people make 250K+), and greater spending is the fastest way to economic Armageddon that I can think of. However, add in the wealth redistribution of giving these extra taxes to those that don't even pay tax, and I'm not sure you will see the guy alive all that long. Its dangerous to just blatantly bend over the rich elite. Higher taxes isn't the issue. Blatant wealth redistribution is.
     
  532. It is hanging on the coattails of an energy bill that the House had already passed to the Senate, the new bill wasn't allowed to come from the Senate, so it had to be added to another bill the House had already passed up to them. Might be the reason for the length.
     
  533. Anybody know when the House votes on this gigantic 450 page bill? Is it during market hours again tomorrow or are they gonna mess around till next week?
     
  534. Are the people who thought up this 'tax' completely retarded or what?

    Take for example a transaction involving the buying and selling of 1000 shares of AAPL (which can be done in seconds). The tax as I understand it is 1/4 of 1% of the price of the transaction. To be taxed on both the buy and sell side.

    If any of my math is wrong feel free to correct me. ......

    AAPL closed today at $109.12 x 1000 shares = $109,120

    1% of $109,120 = $1,091.20

    1/4 of that = $272.80 ( x by 2 for both sides = $545.60)

    The tax on 1 share, only on the buy side = 27.28 cents.

    Today AAPL traded 46,328,868 shares. The tax collected on this volume would be $12,638,515

    $12.6 million in tax collected on one stock in 1 day? Are you fu**ing kidding me? So we punish 'greed' by Wall St. with greed from government.

    This brilliant idea is from the people who lead us? Lead us where? Into the abyss?
     
  535. red ink on your 3 mil shares a day you'd pay around 150k a day in taxes. every hardcore trader on this board would be out of business overnight
     
  536. Red Ink, if you continue along those lines of thinking, too, you'll realize that by expecting to collect $150 billion, I think they've already accounted for the decrease in volume when they came up with those figures.
     
  537. They said earlier that due to house rules a Senate bill has to sit overnight (weds don't count so Thurs would be the overnight) so earliest vote would be Fri. daytime.
     
  538. Well that seems fair considering that I don't even live in the United States.

    I never lied to get a mortgage that I knew I couldn't afford.

    Nor did I create BS mortgage backed securities and peddle them all around the globe.

    Nor was I involved with ratings agencies who labled crap AAA+.

    Nor have I ever been a member of congress who was completely asleep at the wheel and derelict in my duties of oversight.

    Nor would I be responsible for turning NYC into a ghost town.

    My volume would simply go elsewhere. I am sure the Nikkei, Hang Seng, Kospi, Dax would love my volume. Traders will trade, but if I am going to have a gun jabbed into my ribs it won't be on US exchanges.
     
  539. I'd like to know this too