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Lord Lawson condemns 'perverse' EU financial tax plan
http://www.x404.co.uk/forum/viewtopic.php?f=19&t=19082		 Page 1 of 1
Author:  pcernie [ Sun Jun 02, 2013 8:53 pm ]
Post subject:  Lord Lawson condemns 'perverse' EU financial tax plan
http://www.bbc.co.uk/news/business-22723385
Author:  l3v1ck [ Mon Jun 03, 2013 5:59 am ]
Post subject:  Re: Lord Lawson condemns 'perverse' EU financial tax plan
This plan would hit London hard. It's a bad idea if it's not global.
Author:  Amnesia10 [ Mon Jun 03, 2013 6:37 am ]
Post subject:  Re: Lord Lawson condemns 'perverse' EU financial tax plan
l3v1ck wrote:
This plan would hit London hard. It's a bad idea if it's not global.

While it would be best if this was global it can be applied globally to all countries wishing to trade in EU stocks. Pretty much the same way that any business that deals with US citizens has to apply to US laws. That is the principle that has just been used to crack open the swiss bank secrecy laws especially as they apply to US citizens. This tax is so minuscule that even if passed in full to retail investors they would not even notice it. It would kill the front runners such has high frequency traders as it would eliminate their margins. This might have little impact on London as it will actually reduce the volatility by eliminating flash crashes. Just because a business sector tells you that it is bad does not mean that it is bad.
Author:  l3v1ck [ Mon Jun 03, 2013 7:21 am ]
Post subject:  Re: Lord Lawson condemns 'perverse' EU financial tax plan
Why would traders stay in London at all?
Why not move to the fat east add carry on trading how they want there?
Author:  hifidelity2 [ Mon Jun 03, 2013 12:52 pm ]
Post subject:  Re: Lord Lawson condemns 'perverse' EU financial tax plan
Amnesia10 wrote:
While it would be best if this was global it can be applied globally to all countries wishing to trade in EU stocks.

How - if want to buy / sell stock in a company thats listed on the on all the worlds exchange inc the Outer Mongolia Exchange (OM) and that one does not have a transaction tax then I will do so as it will save me money

I can always set up a Co to based in OM so it does not impact on my UK / EU business. the difference is now that all the profits from that deal go to OM and not the UK



Amnesia10 wrote:
Pretty much the same way that any business that deals with US citizens has to apply to US laws.

Err no they don't as I'm sure my business does not enforce the right to bare arms. Any good I sell must comply with safely laws etc but for example I can run my factories as a sweat shop that would break all EU/ US labour & H&S laws and thats not illegal
Author:  jonbwfc [ Mon Jun 03, 2013 1:23 pm ]
Post subject:  Re: Lord Lawson condemns 'perverse' EU financial tax plan
hifidelity2 wrote:
Err no they don't as I'm sure my business does not enforce the right to bare arms. Any good I sell must comply with safely laws etc but for example I can run my factories as a sweat shop that would break all EU/ US labour & H&S laws and thats not illegal

Classic example : FoxConn. Sells billions upon billions of dollars worth of goods into the US & EU, patently don't comply with all EU or US employment laws. It's an oft heard argument that we might as well stay in the EU as we'd have to uphold any EU laws related to business anyway to trade with them. The reality is this simply isn't true, as the EU trades with many countries around the world which don't uphold labour laws identical to the EU's. In fact we don't have the same labour laws as Germany or France anyway, so even being in the EU makes no difference. I happen to like being in the EU - off to Madrid end of the month :) - but the idea business will let labour law variations stand in the way of profit is err... naive at best.

As for Lawson, I stopped listening to his opinion on economic policy the day mortgage interest rates hit 10% on his watch. The man's a clown.
Author:  Amnesia10 [ Mon Jun 03, 2013 4:52 pm ]
Post subject:  Lord Lawson condemns 'perverse' EU financial tax plan
hifidelity2 wrote:
Amnesia10 wrote:
While it would be best if this was global it can be applied globally to all countries wishing to trade in EU stocks.

How - if want to buy / sell stock in a company thats listed on the on all the worlds exchange inc the Outer Mongolia Exchange (OM) and that one does not have a transaction tax then I will do so as it will save me money

I can always set up a Co to based in OM so it does not impact on my UK / EU business. the difference is now that all the profits from that deal go to OM and not the UK

And how much would that cost you to offset the fractions of a penny tax? ;)

hifidelity2 wrote:
Amnesia10 wrote:
Pretty much the same way that any business that deals with US citizens has to apply to US laws.

Err no they don't as I'm sure my business does not enforce the right to bare arms. Any good I sell must comply with safely laws etc but for example I can run my factories as a sweat shop that would break all EU/ US labour & H&S laws and thats not illegal

So you have become an American citizen? When you are here you are expected to follow local laws. Though if you accept and trade in dollars then you have to comply with US laws. It is why Iran cannot sell its oil to its neighbours and accept dollars. So they are accepting other goods and currencies when they sell to China. It is why the FBI seized Liberty Finance in Costa Rica for illegally trading in US Dollars. It is why Barclays Bank are under investigation by the FBI as well.


Sent from my iPad using Tapatalk.
Author:  ShockWaffle [ Mon Jun 03, 2013 5:30 pm ]
Post subject:  Re: Lord Lawson condemns 'perverse' EU financial tax plan
Amnesia10 wrote:
if you accept and trade in dollars then you have to comply with US laws. It is why Iran cannot sell its oil to its neighbours and accept dollars. So they are accepting other goods and currencies when they sell to China. It is why the FBI seized Liberty Finance in Costa Rica for illegally trading in US Dollars. It is why Barclays Bank are under investigation by the FBI as well.

You've completely misunderstood how sanctions work there. There are entire nations that use the US dollar as currency without obeying any such rule or suffering any consequence.Trillions of dollars of trade happens every year that US law has no jurisdiction over whatsoever.

In a strictly economic sense, an FTT is perverse, in that it has unwanted side effects. One such effect is to drive trading activity offshore. But others include reduced levels of trading, which reduces liquidity for the shares themselves and makes mispricing harder to spot, this affects smaller companies more than larger ones, which adds value to large companies at the expense of their smaller competitors.

Another is that it stands to achieve one of its objectives - to promote the long term ownership of shares - the wrong way. It doesn't make long-termism more rewarding by promoting better corporate governance, it simply scares off flighty capital which usually won't go to long term publicly listed equities.

Public listing for companies is already in the decline. This tax is a big hike for all the funds that trade a lot, but whatever shares you own, you do eventually want to sell to those guys. The opportunity won't disappear of course. Perhaps business as usual will still carry on - if so their capital costs will be higher so your gain will be lower. More likely though, they won't want to work that way any more, there are less rules and friction for Private Equity, so this risks pushing more capital that way.
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