Re: Schüssel: Imbecile

On Wed, 18 Jan 2006 22:14:06 GMT, Stephen Glynn
<stephen.glynn@xxxxxxxxxxxx>
mysteriously appeared thru the usenet mist to inform us thus...

>hummingbird wrote:
>> On Wed, 18 Jan 2006 20:32:33 +0000 (UTC), "DVH" <dvh@xxxxxxxxxxxx>
>> mysteriously appeared thru the usenet mist to inform us thus...
>>
>>
>>>"Financial investors should pay new taxes to fund the European Union,
>>>Wolfgang Schüssel, the Austrian chancellor and new holder of the rotating EU
>>>presidency, said on Wednesday...
>>>
>>>Setting out his plans for the six-month Austrian EU presidency, Mr Schüssel
>>>said: "It can't be right that short-term financial speculation is not
>>>subject to taxation at all.
>>
>>
>> Why do you say Schüssel is an imbecile for saying this?
>>
>> I have long advocated such a tax on speculation although in my case
>> it's not to raise money but to deter short-term speculation which
>> unbalances markets and often has adverse effects on companies and
>> currencies etc.
>>
>> My own proposal has always been a tax on capital gain:
>> sell after 120 days - pay tax as normal
>> sell between 90-120 days - pay 25% tax
>> sell between 60-90 days - pay 50% tax
>> sell between 30-60 days - pay 75% tax.
>> sell within 30 days - pay 100% tax.
>>
>> Such action would help return markets to what they were originally
>> intended for: a place for investors in industry, instead of what they
>> have become: giant gambling casinos.
>>
>
>You misunderstand the way the futures markets work and what they're
>there for.
>
>Someone manufactures widgets. To do this he has to import materials
>from abroad (which he has to pay in dollars) and he sells his widgets
>all over the place, so he's getting paid in Euros, dollars and yen.
>
>Now, he knows all about widgets and the market for them, but he doesn't
>know much about what the currency and commodities markets are going to
>do over the next financial year. Nor does he like gambling the
>company's future on his best guess. Fortunately, there are people who
>make a living out of gambling on these markets.
>
>He, therefore, cranks up Excel, does his costings and works out what
>sort of costs for his components and raw materials he can live with and
>what sort of rate at which he needs to be able to sell the Euros,
>dollars etc that he gets paid for his products (or, if he insists on
>being paid in Stirling, what sort of exchange rates will need to prevail
>for his prices to remain competitive in these various overseas markets.
>
>Armed with this knowledge he goes out and tries to buy appropriate
>options from brokers on the futures market to buy his raw materials at a
>particular price at particular times and to buy and sell the expected
>amounts of currencies he'll be needing/being paid. At the end of the
>exercise, he's happy because he's managed, in effect, to insure himself
>against adverse commodity and currency movements.
>
>How's he done this? By finding people who're prepared to take on the
>risk on his behalf. How do they make their money? Partly from the
>fees he's paid, of course, but mostly from trading the options they've
>taken on. In other words, gambling, just as syndicates at Lloyds
>'gamble' on the risks of people's cars being stolen, houses burning down
>and their dropping dead in the street.
>
>Levy punitive 'windfall' taxes on top of what these dealers already pay
>in corporation tax, and all you'll succeed in doing is making life more
>difficult and expensive for the widget manufacturer.

My comments were aimed at the markets in general. I never mentioned
the futures markets specifically, so why you have provided a long
explanation of why people use them is a mystery.

IIRC from several years ago in the FT, only a small proportion of
currency transactions performed each day are trade related, the
rest are pure speculation as we saw with Soros some time back.
These daily currency transactions run into billions of dollars.

There remains a strong case to tax speculation in the markets but
the situation would never be black and white.

--
"It [Blair's government] has exploited the mood of insecurity
to push through a law protecting itself from public protest."
How freedom of speech is being curtailed in Britain under Blair:
http://www.timesonline.co.uk/article/0,,2092-1937539,00.html
.

Relevant Pages

  • Re: The dollars decline: from symbol of hegemony to shunned currency
    ... would want to be paid in yen, and if not yen then the euro or sterling." ... who said the dollar was "losing its status as the world currency". ... The Federal Reserve has cut interest rates twice since September to ...
    (soc.retirement)
  • The dollars decline: from symbol of hegemony to shunned currency
    ... of confidence in the world's totemic currency has become so widespread ... their wealth to stronger currencies such as the euro, ... August might have been thinking, 'I'm paid in dollars, how annoying' ... The Federal Reserve has cut interest rates twice since September to ...
    (soc.culture.cuba)
  • Re: The dollars decline: from symbol of hegemony to shunned currency
    ... currency AND a strong manufacturing sector, simultaneously, in a global ... would want to be paid in yen, and if not yen then the euro or sterling." ...
    (soc.retirement)
  • The dollars decline: from symbol of hegemony to shunned currency
    ... After months of huge and sustained turmoil on the money markets, lack of confidence in the world's totemic currency has become so widespread that an increasing number of international traders are transferring their wealth to stronger currencies such as the euro, which recently hit its highest level against the dollar. ... "But the problem is so serious that there are people who in July or August might have been thinking, 'I'm paid in dollars, how annoying' for whom it's now a question of, 'Do you have a job; ... Kenneth Froot, a Harvard university professor and former consultant to the US Federal Reserve, warned yesterday: "Part of the depreciation is permanent. ...
    (soc.retirement)
  • Re: communicating with tablelist embedded widgets
    ... I have a question regarding communicating with the ... where ComboBox is a list of currencies that the user should select one ... You should read the Tablelist Programmers Guide, which contains, among others, a detailed discussion of interactive cell editing with the aid of various widgets from the BWidget package. ... the selected currency name will be contained in the tablelist widget's internal list and can be fetched via ...
    (comp.lang.tcl)