Merkel still backs Juncker...

[Guest]

The UK has not blocked it - they were overruled by the EU Court because it is not yet in effect and the UK wanted it to be selective against the micro-second trading. I still don't see why I should pay 1,5% on every other transaction however, especially when the UK is not asking for this?

Micro second would be difficult to administer in isolation - think of the massive paper tail and the potential to avoid it. Almost impossible to audit for almost no gain in benefit. I actually see that the tax is fair on all transactions.

Shoog

[keithisco]

Micro second would be difficult to administer in isolation - think of the massive paper tail and the potential to avoid it. Almost impossible to audit for almost no gain in benefit. I actually see that the tax is fair on all transactions.

Shoog

Then simply ban this type of trading. I already pay standard charges and Capital Gains (should I be lucky enough) Tax - so why introduce even more taxation? Because the EU says I have to?

The question still stands - who is the beneficiary of this additional tax?

"We have to be realistic and truthful to our publics about who pays this tax. There is not a single banker in this world who is going to pay this tax. There are no banks who are going to pay this tax. The people who will pay this tax are pensioners, with pensions. They are taxpayers through their governments because they have to raise money on through sovereign debt auctions. This is not a tax that is paid for by bankers or banks. I am all in favour of taxes that are paid by bankers and banks that is why I have introduced a bank levy in the UK paid for by banks and their shareholders. A financial transaction tax is paid for by the end beneficiaries of financial transactions and that is pensioners. So if you want to go and introduce a big tax on pensioners that is the end result. But at least be honest about who pays this tax.

"We are not being honest about the revenue that is supposed to come from this tax even if all the business didn’t leave the European continent and we were able to collect it. This money has been spent four times over by the people around this table. It is supposed to be contributing to the EU budget, which is the commission’s proposal. It is supposed be helping national government’s fill the hole in their public finances. The third use, is to spend the money on the aid commitments that some countries around this table have not delivered on. The fourth idea, is that it should be spent on climate change commitments. So the same money has been spent four times over.

Source: http://www.telegraph.co.uk/finance/personalfinance/consumertips/tax/8876872/Tobin-Tax-What-George-Osborne-told-EU-finance-ministers.html

[stevewinn]

So? Do you hear the Germans scream that they are being targeted unfairly because they have to stem the biggest carbon reduction? Or the French because they loose the most because the farm subsidies are being cut back?

Britain must come to grips with the fact that they cannot pick the cherries. Its either the whole cake or it is nothing.

And that is exactly what's wrong with the EU. the take it or leave it approach, a hell of a lot as changed since we joined the EU and every step of the way and here im talking decades we have been blocked when raising National concerns with very few concessions made along the way, such as rebates etc. but these as recorded by History are only token gestures.

We've seen slowly over time vetoes and powers have eroded with each treaty signed and at the same time we've seen the Germans increasing their stranglehold on the EU and Eurozone its no coincidence. It's correct that the powers Britain as lost is equally so by the Germans too, but we have lost true powers were German has lost little. Its easier for Germany to concede powers when Germany still holds the balance of power in Europe, through the use of softpower both Economic and Financial. look no further than the Eurozone Crisis. interest rates implemented in favour of the German Economy, to the detriment to the poorer members especially the southern Mediterranean members - so much for the were all equal in this club (union) all for one and one for all.

The frightening part is France. one of the three great powers of Europe and when faced with economic meltdown of their own economy they decided to accept the Euro interest rate to be set in favour of the German Economy, Its unbelievable, we've witnessed the diverging of the French and German Economies. now three years later and the fruits of their labour are there for all to see the French economy is to post the slowest growth in the Eurozone.

The power held by the EU over the French agricultural industry is astounding the French economy would be doomed if the money from Brussels stopped flowing, In short its at the mercy of the EU. We've all seen in the past the power and influence the French farmers have over the French government, anyone dare mention reform or reduced budget and they are up in arms, out on their tractors protesting blocking all the major ports and motorways, channel tunnel etc... you might not have noticed but next time now i've drawn your attention to it. look at those tractors the vast majority are old circa 1950's design and of no real size or power simply unsuitable for modern farming methods, and you notice this as you drive through France. this is thanks to old French laws, whereby if a farmer has two sons the one farm is split between the two, so you now have two farms - repeat this process a few generations and down the line that one big farm is now many smaller farms, nothing more than a collection of small holdings, unsustainable low productivity and totally reliant on EU handouts for many of their survival. basically the EU is paying a load of French smaller holders to do very little. I guess it stops the storming of the Bastille. it highlights a great bargaining tool the EU i mean the Germans have.

Moving away from that - As for the financial policy of the EU, let them get on with it, their policies are a joke in a global market. lets see how far that policy gets them. The markets will ultimately decide but im sure they'll favour the City of London even more. 30% of Europe's transactions go through

[keithisco]

And that is exactly what's wrong with the EU. the take it or leave it approach, a hell of a lot as changed since we joined the EU and every step of the way and here im talking decades we have been blocked when raising National concerns with very few concessions made along the way, such as rebates etc. but these as recorded by History are only token gestures.

We've seen slowly over time vetoes and powers have eroded with each treaty signed and at the same time we've seen the Germans increasing their stranglehold on the EU and Eurozone its no coincidence. It's correct that the powers Britain as lost is equally so by the Germans too, but we have lost true powers were German has lost little. Its easier for Germany to concede powers when Germany still holds the balance of power in Europe, through the use of softpower both Economic and Financial. look no further than the Eurozone Crisis. interest rates implemented in favour of the German Economy, to the detriment to the poorer members especially the southern Mediterranean members - so much for the were all equal in this club (union) all for one and one for all.

The frightening part is France. one of the three great powers of Europe and when faced with economic meltdown of their own economy they decided to accept the Euro interest rate to be set in favour of the German Economy, Its unbelievable, we've witnessed the diverging of the French and German Economies. now three years later and the fruits of their labour are there for all to see the French economy is to post the slowest growth in the Eurozone.

The power held by the EU over the French agricultural industry is astounding the French economy would be doomed if the money from Brussels stopped flowing, In short its at the mercy of the EU. We've all seen in the past the power and influence the French farmers have over the French government, anyone dare mention reform or reduced budget and they are up in arms, out on their tractors protesting blocking all the major ports and motorways, channel tunnel etc... you might not have noticed but next time now i've drawn your attention to it. look at those tractors the vast majority are old circa 1950's design and of no real size or power simply unsuitable for modern farming methods, and you notice this as you drive through France. this is thanks to old French laws, whereby if a farmer has two sons the one farm is split between the two, so you now have two farms - repeat this process a few generations and down the line that one big farm is now many smaller farms, nothing more than a collection of small holdings, unsustainable low productivity and totally reliant on EU handouts for many of their survival. basically the EU is paying a load of French smaller holders to do very little. I guess it stops the storming of the Bastille. it highlights a great bargaining tool the EU i mean the Germans have.

Moving away from that - As for the financial policy of the EU, let them get on with it, their policies are a joke in a global market. lets see how far that policy gets them. The markets will ultimately decide but im sure they'll favour the City of London even more. 30% of Europe's transactions go through

A finely crafted and excellent post Steve!! :clap:

[Guest]

Then simply ban this type of trading. I already pay standard charges and Capital Gains (should I be lucky enough) Tax - so why introduce even more taxation? Because the EU says I have to?

The question still stands - who is the beneficiary of this additional tax?

Source: http://www.telegraph...-ministers.html

I don't accept the Telegraph reporting on this. The paper of the Tory establishment trying to scare pensioners.

Br Cornelius

[Harry_Dresden]

Double post.

Edited July 2, 2014 by Harry_Dresden

[Harry_Dresden]

Attention Keith.

You make it sound like this tax will be detrimental to the UK economy. In the short term it will have an effect BUT You seem to forget that it will also effect all of Europe too.

The reason for introducing this tax is reducing financial speculation. One of the main reasons that created the GFC and ultimately far more damage than any minuscule tax would.

I think Westminster's objections to this tax, have more to do with not getting a piece of the pie. If Cameron had thought of this first I bet it would have been a 'capital' idea. Trust me.

So according to you, another reason for Cameron and Co to take Britain outta the EU...I wonder what they are waiting for?

Edited July 2, 2014 by Harry_Dresden

[keithisco]

Attention Keith.

You make it sound like this tax will be detrimental to the UK economy. In the short term it will have an effect BUT You seem to forget that it will also effect all of Europe too.

The reason for introducing this tax is reducing financial speculation. One of the main reasons that created the GFC and ultimately far more damage than any minuscule tax would.

I think Westminster's objections to this tax, have more to do with not getting a piece of the pie. If Cameron had thought of this first I bet it would have been a 'capital' idea. Trust me.

So according to you, another reason for Cameron and Co to take Britain outta the EU...I wonder what they are waiting for?

Not so miniscule as you would have us think:

The rates proposed sound negligible, but the tax would be imposed at each point in the transaction chain. A 0.1% rate therefore translates into something much bigger as securities move from seller to buyer via financial intermediaries. Even the headline rates are less innocuous than they look. A 0.1% charge on repo transactions, a way for banks to finance themselves overnight, turns into a 25% charge over the course of a working year. A 0.01% tax on a derivative trade sounds small, but is a hefty increase in costs given the large notional amounts involved—up to 18 times more than current costs in the most liquid markets, according to one calculation.

A Bank of Canada analysis of the effect of previous FTTs found that they tend to harm market quality, by increasing volatility, reducing volumes and raising the cost of capital. The early effect of a French equity FTT that was introduced last summer was to hit trading in the shares of smaller firms. Without a co-ordinated global approach, the taxes are also likely to be circumvented by savvier investors, leaving retail investors to pick up the bill. After Sweden levied an FTT in the 1980s, 60% of trading volume in the most actively traded share classes moved to London; the tax was repealed in 1991.

Source: http://www.economist.com/news/leaders/21572205-plans-transactions-tax-ought-be-dropped-bin-it

Cameron cannot take the UK out of the EU without a referendum, although you seem to think that he can (wrongly)

[Harry_Dresden]

The important part of the quote you provided is the word 'proposed.' Nothing is set and I'm sure it's a case of you go low, I'll go high, until a fair, formula, is found that pushes the greedy banksters outta the markets and keeps the money markets healthy and sustainable.

The reality is Keith, Britain, needs to build more than a services industry in order to thrive in Europe and the world. And that's the problem that keeps bringing us full circle. Britain is predominately, a services backed economy, dependent on free movement of goods and services within the EU. In fact one if not the biggest beneficiary of this policy, Britain has attracted MORE educated and talented people and not to mention mountains of money, than the rest of the EU. and here's the Schizophrenic crunch...Westminster, want's to champion free trade and at the same time place restrictions on this free trade that provided the UK with this services bonanza (cause lets face it, it's all Britain really has). You see Keith, we keep coming around to the same point, the UK just can't have it both ways...and the people shouldn't be used as gullible instruments for the unrealistic ambitions of Westminster. The EU is a positive force and fighting the appointment of Juncker was nothing more than a futile exercise that will haunt, Cameron and the euro-sceptic, for a very long time.

Edited July 2, 2014 by Harry_Dresden

[Harry_Dresden]

Keith say's..."Cameron cannot take the UK out of the EU without a referendum, although you seem to think that he can (wrongly)"

Cameron and the euro-sceptics can sabotage the debate and recommend that it isn't in the UK's best interests to stay in the EU. They can make their time in the EU as trouble-some as possible and they can withdraw entirely from it's institutions. But you're right. without a referendum they can't leave.

[Guest]

Cameron doesn't want to leave and that is his stated position. If a referendum comes he will argue to remain within the EU.

Br Cornelius

[Harry_Dresden]

Cameron doesn't want to leave and that is his stated position. If a referendum comes he will argue to remain within the EU.

Br Cornelius

I agree, Br Cornelius. Cameron knows which side the UK's bread is buttered. Too much is at stake to seriously propose taking the UK out of the EU. But it still doesn't stop him from playing it for political interests.

[Guest]

I agree, Br Cornelius. Cameron knows which side the UK's bread is buttered. Too much is at stake to seriously propose taking the UK out of the EU. But it still doesn't stop him from playing it for political interests.

Thats because he's a weak simpering idiot and this whole episode just reinforces that fact. I pity the British for having to put up with him.

Br Cornelius

[keithisco]

The important part of the quote you provided is the word 'proposed.' Nothing is set and I'm sure it's a case of you go low, I'll go high, until a fair, formula, is found that pushes the greedy banksters outta the markets and keeps the money markets healthy and sustainable.

The reality is Keith, Britain, needs to build more than a services industry in order to thrive in Europe and the world. And that's the problem that keeps bringing us full circle. Britain is predominately, a services backed economy, dependent on free movement of goods and services within the EU. In fact one if not the biggest beneficiary of this policy, Britain has attracted MORE educated and talented people and not to mention mountains of money, than the rest of the EU. and here's the Schizophrenic crunch...Westminster, want's to champion free trade and at the same time place restrictions on this free trade that provided the UK with this services bonanza (cause lets face it, it's all Britain really has). You see Keith, we keep coming around to the same point, the UK just can't have it both ways...and the people shouldn't be used as gullible instruments for the unrealistic ambitions of Westminster. The EU is a positive force and fighting the appointment of Juncker was nothing more than a futile exercise that will haunt, Cameron and the euro-sceptic, for a very long time.

I think there is a common misconception in just what a service economy includes: Think of some of out biggest companies; Rolls - Royce, Airbus, BAe Systems, IT and Communications knowledge Pharmaceuticals, etc. Then consider the Research, design, and development activities that go towards producing an end product. Where the UK Service Industry excels is in providing the technological expertise that the World is clamouring for.

It is not all about Financial Services (which accounts for less than 10% of GDP)

As an aside; The services sector in the UK contributes 78% to GDP, in Germany that figure is very similar at 70%

Edited July 2, 2014 by keithisco

[Frank Merton]

I don't think micro-trading is really a problem; it is more like something we heard is going on that is new and different and somebody might make some money off of so it has to be stopped if I can't do it too. If it really were that valuable the brokers would be under pressure to let normal people participate. I think it adds a tad more liquidity but is not unfair. If they become burdensome for the exchanges let the exchanges deal with them.

What this tax is for is to destroy London's position in European trading, and the real benefit will go to New York and less to Tokyo and a few others. The Germans and French see this as a way to raise revenue from the pockets mainly of the British. That is bound to backfire and seems to be doing so already.

[Guest]

I don't think micro-trading is really a problem; it is more like something we heard is going on that is new and different and somebody might make some money off of so it has to be stopped if I can't do it too. If it really were that valuable the brokers would be under pressure to let normal people participate. I think it adds a tad more liquidity but is not unfair. If they become burdensome for the exchanges let the exchanges deal with them.

What this tax is for is to destroy London's position in European trading, and the real benefit will go to New York and less to Tokyo and a few others. The Germans and French see this as a way to raise revenue from the pockets mainly of the British. That is bound to backfire and seems to be doing so already.

Frank its a very real problem because it increase volatility in an already volatile market.

Look at what happens when you allow computer algorithms to do your split second trading - a crash of 9% in the value of the Dow Jones in a matter of seconds. That time it recovered but the panic could have caused a much worse plunge to people who didn't know what really happens;

http://en.wikipedia....010_Flash_Crash

This situation is a catastrophy waiting to happen and it brings absolutely no real value to the real economy - not a brass cent.

Br Cornelius

Edited July 2, 2014 by Guest

[Frank Merton]

The solution to the situation you paint, which I have yet to see in real life, is to never enter market orders. Volatility by itself is neither good nor bad as far as I can see.

[questionmark]

The solution to the situation you paint, which I have yet to see in real life, is to never enter market orders. Volatility by itself is neither good nor bad as far as I can see.

If the people can create the volatility themselves to benefit their pocket book, without letting others partake on that, it surely is, it is just another form of exchange manipulation... only that it is legal.

Edited July 2, 2014 by questionmark

[Guest]

The solution to the situation you paint, which I have yet to see in real life, is to never enter market orders. Volatility by itself is neither good nor bad as far as I can see.

Volatility makes economic and industrial planning difficult - it also cause real crashes since the markets work to a large extension on irrational sentiment. This is amplified by volatility. There is absolutely no real value generated by split second trading - none. It is pure speculation and market manipulation.

This was specifically what Tobin was attempting to address with his tax - and he was a Noble Laureate economist. He saw thing from the distance of the 1970's before high speed computer trading when he considered a quick trade to be less than a day - not a nano-second like today.

Br Cornelius

Edited July 2, 2014 by Guest

[Frank Merton]

If the people can create the volatility themselves to benefit their pocket book, without letting others partake on that, it surely is, it is just another form of exchange manipulation... only that it is legal.

LOL That's not how it works.

[Frank Merton]

The solution, if you think it's a problem, of sudden swings in a stock or in the market can be mitigated fine with circuit breakers, and they are now unfortunately common. My feeling is if someone foolishly enters highly volatile markets and gets stung someone else has made some money and that is what it is about. There is no harm in the extra key strokes needed to make it a limit order and then you are safe -- you have your own circuit breaker. I find that they are also useful in that market makers try to execute these limit orders and sometimes that gets me a bargain.

Volatility I suppose interferes with people's plans. Too bad. They love it when their plans are exceeded and don't like it when they aren't. That is just the nature of markets and trying to dam them has much the effect of damming rivers -- when the dam breaks (and in markets where everyone knows how much the dam can take it becomes a target) the damage is much worse.

[Guest]

LOL That's not how it works.

#

Thats exactly how it works. Create a panic by dumping stocks. Wait for the decline mico-seconds later and then buy back. The market rises back to its previous level but the dumper is quids in on the deal. That is the stock market these days.

You really should research the practices of the wide boys operating out of London and Wall street. It is so far from its intended purpose as not to be funny anymore.

Br Cornelius

[Guest]

Frank - please just answer me this - where is the real economic value in all this ? making money isn't making value.

Br Cornelius

[questionmark]

LOL That's not how it works.

No, does or does microtrading not increase volatility? And could fast trades not make some "desirable stock" go through the roof? After Porsche started hogging all VW shares that were available on the market microtrades kept on pushing the value of a stock that you could not even buy back in 2009 because none were on the market (all empty sales) and converted VW into the most valuable car company in the world for two days.

The only good news about it was that those who got burned by that one were some hedgefonds (that are still trying to get their money back through the courts... with little chance of success I might add) and Porsche.

Naturally it works like that, maybe not for the little day-trader at home (because they are too small to move the market) but surely for a big organization like a bank or a brokerage.

[Frank Merton]

I don't care if there is market value and I don't care if someone creates a panic and then buys it back. You sure do have an image of stock traders as a bunch of idiots. Most of the time when someone tries a trick like that they get their ass handed to them.

Stock markets exist mainly so investors have a quick and easy way to sell. The liquidity is what makes public securities attractive. All the regulations just drive trading to another venue. Now some rules I approve of, such as making brokers compete on commission, but rules that effectively stymie animal spirits are a bad idea.