Forum Post: High Frequency Theft (Trading) and the Liquidity Lie
Posted 13 years ago on Oct. 14, 2011, 8:46 p.m. EST by Phrenologist
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Now is the time for our nations leaders to draw a crystal clear, razor sharp distinction between INVESTING and TRADING. Our great nation was built on a foundation of investing in businesses that would employ people and relentlessly reshape the future in a positive way. Wall Street has become anti-investment and pro-trade. If I buy a stock now and sell it a fraction of a second later I really haven't invested in anything. Why on earth should that behavior garner an insanely low tax rate that is far below what hard working honest people are taxed at. These traders siphon the money out of the 401k and pensions of the masses and aggregate that money into the hands of a very few people AND, they are given incredible tax breaks for doing it. The economy cannot move forward until this issue is addressed once and for all. Profits on trades held less than a day should be taxed at 90%. Investments held over a year should be taxed a 5%. Then money would flow into the most viable businesses and people would be employed. Vote for changing the tax code on trading immediately. One simple tax code change can immediately lower unemployement and improve the future of the other 90%. Make a difference by drawing attention to this ridiculous practice that stacks the odds so heavily in favor of the mega wealthy.
Good post
The best way to stop manipulative high-frequency algorithmic trading is for the SEC to enforce the Securities Exchange Act of 1934 and bust the crooks who front-run and pump-and-dump honest investors. Unfortunately, the SEC is conflicted and useless .
Those types of trades do not get long term capital gains treatment. Short term capital gains are treated as ordinary income and are subject to the prevailing marginal tax rate. Therefore, the long term capital gains rate does not come into play here.
OTOH, there is historical evidence that the revenues generated from long term capital gains taxes increase when the rate is dropped.
There are more problems than just flash trades. Goldman Sachs can borrow at .5% from the discount window and buy unlimited t-bonds that yield 1%. ...basically free money.
I think High Frequency Trading's value is overrated and dangerous but this kind of tax doesn't make the most sense. I think reducing leverage and raising margin requirements are better ways of reducing the presence of HFT
The American government has been a corporate enterprise since its inception. Wall Street is a parasite on the American system. A parasite must be severed from its host and exterminated. If the American government has developed a symbiotic relationship with the parasite, it too must go.
CAP SALARIES- Make Corporations Responsible for Communities at large... they need to be responsible actors in this game - they need to be forced to change ... Read Neale Walsh ... says it perfectly ... any corporation - all employee salaries are visible - each knows what each is making... cap the salary level where above this any profits get cut - percentage to the work force... percentages to management - they get paid more for a reason and are not hourly for a reason- they are paid high enough already to make the hard decisions... workers making the product, workers keeping the quality high and making management happy deserve the biggest bang... now once you have that you take another percentage and GIVE to programs - GIVE to charity ... you make your American Corporations RESPONSIBLE - put this into legislation - ADD THIS TO OUR LISTS OF DEMANDS: CHANGE EXISTING Legislation - we need to see Banking Regs change - we need to change the SEC rules and regs... we need to change the way corporations are allowed to do business. THEY MUST be made into responsible bodies that support their communities... Make Corps Responsible to the Communities at large...
There is no reason to reduce the tax rate on long-term investment gains. For the rich, the rate is currently 15%. If anything, that rate should be increased since the income is unearned.
Earned income (i.e., people earning money) should be taxed at a lower rate than unearned income (i.e., money earning money).
Thank you so much for taking the time to bring this to as many peoples attention as possible. I can tell you know your stuff. That is why you cant stop sharing your mind with others. Good work!
http://www.smashwords.com/books/view/94223
I share your concern. The Wave is one way the big boys do it and it needs to stop. Unfortunately, the SEC, which is supposed to ensure a fair marketplace for all investors, looks the other way.
http://investmentwatchblog.com/the-wave/
lol - and still many dont get this. trading is done by supercomputer that now time every trade for the company's benefit - not society's benefit.
Also when people say they worked hard and SAVED please dont add that they saved it in stocks and bonds - if that was the case they traded and didnt save anything. Investments carry risks - thats the reason we have social security!