Fiscal Policy

Why a Financial Transaction Tax Is a Bad Idea

<em>This article was originally posted on TabbForum <a href="http://tabbforum.com/opinions/associate-professor-university-of-alaska-anchorage">here</a></em> By Holly A. Bell Former Secretary of Labor Robert Reich claims financial transaction taxes are simply sales taxes on Wall Street traders and won’t harm markets or cause capital to flee. Yet studies of FTTs in other countries show they harm Main Street and distort markets. Former Secretary of Labor Robert Reich recently produced a snappy video about why financial transactions taxes (FTTs) as proposed by Bernie Sander’s on the campaign trail should be retained and turned into law. Unfortunately, his pithy presentation is wrought with inaccuracies. He begins by modifying the language of FTTs by shruggingly telling us it’s just a sales tax. We pay sales taxes on many things and it’s only “fair,” he claims, that anyone who sells a stock should pay a tax too. Yet it’s not exactly like a sales tax. For one thing, it’s not transparent. When you go

Tagged , , Read More
market efficiency

High Frequency Trading: Do Regulators Need to Control this Tool of Informationally Efficient Markets?

<p><a href="http://www.professorhollybell.com/wp-content/uploads/2013/07/ID-10049803.jpg"><img class="alignleft size-medium wp-image-2570" alt="market efficiency" src="http://www.professorhollybell.com/wp-content/uploads/2013/07/ID-10049803-300x199.jpg" width="300" height="199" /></a>From the Cato Institute:</p> <p>High Frequency Trading (HFT) is a form of algorithmic trading where firms use high-speed market data and analytics to look for short term supply and demand trading opportunities that often are the product of predictable behavioral or mechanical characteristics of financial markets. Some opponents have argued that these practices create risk and require aggressive regulation.  In a new paper, professor of business Holly A. Bell argues that HFT is already being effectively regulated by the market and its participants.</p> <h3><a href="http://www.cato.org/publications/policy-analysis/high-frequency-trading-do-regulators-need-control-tool-informationally">Click here to read the Holly A. Bell paper</a></h3> <h3><a href="http://www.professorhollybell.com">Return to home page</a></h3>

Tagged , , , , , , , Read More

Why Trading Volume in the Stock Market Has Dried Up

<div class="rpuEmbedCode"><!--rpuEmbedStart--> <script type="text/javascript" src="http://1.rp-api.com/rjs/repost-article.js?3" data-cfasync="false"></script> <div class="rpuArticle rpuRepost-fcc2f5bd1375bb3ce40fe4f3288e7f58-top rpuNoTitle" style="margin: 0; padding: 0;"><a class="rpuThumb" href="http://s.tt/1kJy7" rel="norewrite"><img style="float: left; margin-right: 10px;" src="http://img.1.rp-api.com/thumb/2738722" alt="" /></a> <a class="rpuTitle" href="http://s.tt/1kJy7" rel="norewrite"><strong>Market Shadows Newsletter: It’s my party, and I’ll leave if I want to</strong></a> (via <a class="rpuHost" href="http://s.tt/1kJy7" rel="norewrite">Market Shadows</a>) <p class="rpuSnip">Read the latest MarketShadows August 12 2012 Excerpt: Trading volume this week dried up. Retail investors are realizing that the markets are manipulated and retail traders are learning that it’s difficult to compete against the High Frequency Trading Machines. Zero Hedge revisited the reasons that…</p> </div> <div class="rpuKeywords" style="display: none;">market, stock, <b>stock market</b>, balance sheets, Zero Hedge, slower profit growth, corporate balance sheets, quantitative easing, retail trader, central bank, fiscal cliff, Zero Interest Rate Policy, <i>Stock Market</i> Self-Cannibalization, facto qe programs, <u>Stock Market</u> Rally, Money Market Index, opposite unintended consequence, miss-spent fiscal stimuli, Frequency Trading Machines, Money Anxiety Index, real liquidity provider, virtuous business cycle, automatic spending cuts, global central

Tagged , , , , Read More