I don't think anyone that is now arguing that some firms are too big to fail are also arguing that we would have been better off if those firms were run by the government in the intervening decades in which they did not fail.
Not the same thing as socialism, would could include some nationalised industries, like most countries had until they sold them off in the 80s, and some still have now.
Then we have new socialist policies like nationalising banks and mortguage lenders happening as we speak, so not dead at all.
I've long argued for something similar, just in the housing market: the short-term capital gains tax on homes should be 95%.
The government got into the home-loan business under the pretense that it needed to encourage home ownership to promote community and stability. Then, it allowed flippers to go crazy speculating on home price increases, and effectively subsidized the process via Fannie and Freddie. If we had been taxing short-term home owners at a rate near 100% of their profits, it would have killed the flipping market dead, served to keep home prices in check, and encouraged the values that the agencies were designed to uphold.
(Problem is, of course, that this never could have happened -- for the last three years, the sole pillar of our economic growth has been home price increases. There's no way that congress or the White House would have allowed that pillar to be knocked down. Everyone is conveniently forgetting this today, but it's still true.)
That idea is absolutely foolish. What about penny stocks?
This would result in reverse splits and every stock would cost thousands of dollars to minimize this fee. Foreign exchanges would get a huge boost - especially from stocks traded on both exchanges. Your average investor wouldn't be able to have a balanced portfolio and share price would become a huge issue.
That's the idea (I think). Adding friction to discourage zero sum games (day trading), which create volatility. The higher the stock price & longer you investment period, the lower the tax. If you are making $10 a trade on stock (a minimal amount for muulti-year investments in largish companies) it's insignificant.
The markets were heavily influenced by the government. Risk was removed because of the GSE status of Fannie and Freddie. At the same time the government (both Congress and the president through HUD) pushed Fannie and Freddie to take on more risk to "help the poor".
Did anyone else notice that his math is off? If each sell and buy is taxed at $.10, wouldn't the total tax on a stock transaction be $.20?
A fixed value per stock seems foolish, why not make it a percentage. And, a percentage of the total value isn't very fair (stock values would have to go up significantly for it to be worth buying/selling. So, we'd have to tax just the gains... the capital gains.
Oh right, we already do that. It's called capital gains tax.
Oh right, we already do that. It's called capital gains tax.
No, capital gains tax taxes gains. This will tax losses as well. It seems "unfair", but I think this could prevent people from liquidating "slightly bad" positions that will probably recover.
They are broke because WE are broke and we borrowed money to maintain our artificially high standard of living. Basically, both the private and public sectors of America have proven that we have no self-control. Moving money around won't solve that problem.
