MARK CUBAN: ‘Tax The Hell Out Of Wall Street And Give It To Main Street’

18 Oct

n a world of High Frequency Trading and black box trading that does nothing but create a platform for “financial hackers” to turn the market into their own proprietary financial playground, we need to figure out a way to revert the Stock and Bond Markets, and the derivative instruments created from these equities, back to their original purpose, a place to raise capital for growing business. Instead, today its a platform for financial engineers and hackers looking to exploit every and any opportunity. When 60pct or more of trades are from High Frequency/Algorithmic traders and the correlation for every market index rushes past .7, the market is no longer a market, its a platform.

The simplest way to change this is to place a very simple per share tax on every transaction. 10 cents a trade. Every share. Every option. Every Bond. Every currency transaction. Every trade.

The obvious response is that trading volume will plummet. So what? Let it. The next response is that traders will merely move their trades to foreign exchanges. Yes they will. Will transaction costs go up? Duh.. that is the point. The market thrived when spreads and transaction costs were much higher just a few short years ago. It will survive now.

via MARK CUBAN: ‘Tax The Hell Out Of Wall Street And Give It To Main Street’.

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