Saturday, May 08, 2010

Tax the Hell Out of Wall Street and Give it to Main Street

Tax the Hell Out of Wall Street and Give it to Main Street: "

Today was a brutal day on Wall Street. Through no fault of investors.

Today was brutal because of traders and financial engineers who trade on every piece of data . Those that work from quantitative formulas that drive trades based on data input. Not a single one of them acts like a shareholder. And that is the reality of the stock market.

The market is no longer driven by shareholders. The market is driven by formulas that drive trades.

So what should the government do ?

Tax every single share of stock that is bought and sold 25 cents per transaction. One quarter. If you buy a share of stock, your brokerage pays a 25c tax. If you sell a share, your brokerage pays a 25c tax. 1 share, 100 million shares. Its 25 cents per share.

Of course the tax will be paid for by those of us who are buying and selling stocks. So what? Here is the reality. If you are a true investor. Someone who wants to own a share of stock in a company you believe in, then its an amount that is not going to impact your investment decision making process. You bought those shares to be a shareholder.

If you dont think the company you are buying is worth at least a quarter more than what you are paying , why are you buying shares ?

If you are a professional trader or an institutional trader that trades continuously, the same type of traders that created the mess in the market today, then it may impact your decision making process, but only to the point of reducing your returns by a minimal amount. Its not going to change your inclination to trade. As everyone on Wall Street will tell you “Traders Trade”. You may trade less and make less in aggregate, but no one but you cares about that. You will find your way to make money. There is always the loop hole and inefficiency. Thats what you live for. But you won’t stop trading.

If you are a day trader, you are going to have to be right more often or actually hold on to stocks for a longer period of time. That’s ok. I know it will be rough on some of you that make a living this way. But in reality, you don’t add anything to the markets.

Whats the bigger economic impact of having the tax ?

If the NYSE, Nasdaq, Amex and OTC are trading 2 Billion shares a day or more , like today, thats $ 500 Million Dollars PER DAY. If there are 260 trading days a year. Thats about 130 Billion dollars a year. If volumes drop because of the tax. It is still 10s of Billions of dollars per year.Thats real money for the US Treasury. Thats also an annual payment towards the next time Wall Street screws up and we have a black swan event that no one planned on.Of course there has to be some fine print. You could reduce the tax per share for stocks under $5 dollars to 5cents. But i would leave it at 5cents even for stocks priced at pennies per share or less. This tax would act as a protection for investors and traders who get pitched unregulated penny stocks and who are more often than not the victims of rip off artists. It would minimize the pink sheet companies that trade billions of shares of stocks priced for pennies. Those companies that are legit, could do a reverse split to protect their investors. The others can go away. They probably shouldn’t be public anyway.

The stock market today is dominated by financial engineers and traders. Institutions who look for the loopholes and exploit them. Thats not a bad thing. There will always be loopholes, and they will always find them. But at least with the tax, when they do, we are protecting ourselves a little bit. Heck, the Treasury could join in the show and buy long and short 20pct out of the money derivatives on the market to protect us even more. This way if things go haywire like they did a couple years ago and have the past few days, the Treasury will be playing with Wall Streets’ money. I’m sure Main Street won’t mind terribly if the Treasury plays with the house’s money.

Particularly since the only given for Wall Street is that every 5 years or so there will be an extreme event. Why ? Remember the rule of Wall Street …

First there are the innovators. Then there are the imitators. Then there are the idiots. And there are tons and tons of idiots. Just look at the billions upon billions squandered in closed Hedge Funds. The idiots always find there way back into the market and the market always wipes them out taking investors down with them.

It’s time to make all those playing this game pay a tax per transaction.

And one more thing. When Wall Street talks about how a tax will hurt liquidity, ask them why, if liquidity is so essential to a market, they don’t want any transparency and aren’t trying to increase liquidity for the derivatives they sell on a custom basis ? Or why they are not trying to increase the liquidity for the corporate bond markets where bonds trade with a huge spread ?

They want minimal transparencies where the spreads are high and they can keep them that way and price their products anyway they like. Where the spreads are already low, they cry wolf about the liquidity they need to do business. Let me explain the reality of liquidity in today’s world. It won’t increase the amount of capital available to businesses. The companies that plant servers next to stock exchanges to make a few cents per trade aren’t buying IPOs, secondary offerings, or holding shares in support of valuations in a company they believe in. Every time markets crater, there is never a lack of liquidity. THere are still a billion or more shares traded. There is plenty of liquidity.

So tax the hell out of Wall Street , give it to main street. Make it tougher for the financial engineers and you will make it easier for investors to evaluate companies and hold on to shares and maybe even act like owners of those companies.

Taxing the Hell Out of Wall Street could actually increase the trust investors have in Wall Street. And it might just protect us when the next meltdown happens. And it will happen

The idiots will see to it.

Wednesday, May 05, 2010

Bob Cesca: Republicans and Teabaggers Finally Embrace Big Government

Bob Cesca: Republicans and Teabaggers Finally Embrace Big Government: "

For more than a year now, we've been hearing from Republicans, tea party people and Glenn Beck's chalkboard about how big government is destroying American liberty and freedom. Much of the shrieking is literally accompanied by the yellow Revolutionary War 'Don't Tread on Me' flag.

Every tea party lawn concert and misspelled sign regatta features people dressed in colonial drag with tea bags dangling from their tri-corner hats, waving banners in support of tax cuts, liberty and freedom and against the allegedly tyrannical Obama government. They're really scared and they want their country back from the (somehow) black liberal Nazi.We've heard about how the 'czars' are unconstitutional, even though the name 'czars' was invented by the press as clever pseudonym for 'advisers.'
We've heard about how the Recovery Act, which has created hundreds of thousands of jobs and cut taxes for 95 percent of working families, is unconstitutional and an attack on states' rights and individual liberty.
We've heard about how it's 'generational theft' for the government to spend money to solve an economic crisis. We've heard about how the tax cuts in the Recovery Act are just a scam and should be returned to the government in protest.
We've heard about the crazy conspiracy theories involving the IRS invading our neighborhoods with armed goon squads -- rounding up anyone who purchased one of Glenn Beck's dozens of McBooks. Of course this meme turned out to be entirely untrue as there is no enforcement mechanism in the health care reform law should you simply choose not to pay the tax penalty for not buying insurance.
Republican attorneys general across the nation are challenging the health care law in court because, they say, it's unconstitutional. House minority leader John Boehner once called the bill 'Armageddon' because of the tax penalty for Americans who choose not to buy insurance. Armageddon!
Throughout all of the misinformed and contradictory right-wing antics of the past year, I've been wondering how post-Bush Republicans and conservatives can possibly square all of their newly found affinity for freedom, liberty and the Constitution considering their eight year support for Bush era policies. Policies like illegal wiretaps of American citizens, the USA Patriot Act, suspension of habeas corpus (it's in the Constitution) and all the rest of it.
Have they at long last abandoned their support for these obvious trespasses against liberty and the Constitution? In fact, Glenn Beck said recently that he failed to speak out back then but, 'It doesn't matter. I'm here now.' Convenient timing. History appears to have skipped the first decade of the 21st century.

Put another way, are the Republicans suddenly joining up with civil libertarians to denounce policies that infringe upon basic constitutional rights? Maybe Rush Limbaugh teaming up with the ACLU during his drug case was a sign of things to come. A civil liberties-oriented conservative movement, eh?

Not a chance in hell.
This week, Rep. Peter King (R-NY) said about the failed Times Square car bomb suspect, 'Did they Mirandize him? I know he's an American citizen but still.'
I know he's an American citizen but still. This easily catapults to the top of the list of awful, creepy, dangerous things Republicans have said in the context of terrorism since 9/11 -- the same list that includes: 'None of your civil liberties matter much if you're dead,' and, 'I have had it with members of your party undermining our troops, undermining a commander in chief while we are at war.'
Republicans from King to John McCain to John Cornyn and Jon Kyl are engaged in some sort of weird penis-measuring contest over the Faisal Shahzad case, each attempting to prove how quickly they can subvert the basic rights of American citizenship in order to appear 'tough' on terrorism.
Marco Rubio, who is the tea party favorite for the U.S. Senate from Florida, said, 'If this individual has information that could help us prevent future attacks and loss of life, nothing should stand in the way of that, including Miranda.'
So nothing except, again, the basic rights of American citizenship.

Pseudo-Republican Joe Lieberman wants to change the law in order to strip would-be terrorists of their American citizenship. Hey, why not expand that to encompass all violent crime. Before long, we're not going to need Amendments Four, Five, Six, Seven, Eight and Fourteen.

Liberty! Freedom! Constitution! Except when we're scared.

At the same time, a new poll from the New York Times and CBS shows that a narrow majority of Americans support the Arizona anti-immigration law even though a wide majority also believes that it will involve racial profiling. Concurrent to this poll, a Gallup survey shows that 75 percent of Republicans support the Arizona law with only 17 percent opposed.

Knowing full well that American citizens who happen to be brown will be swept up in the law enforcement dragnet, regardless of whether or not they've actually broken the law and regardless of whether or not they've lived in Arizona longer than many of the white people there, the Republicans and tea party people appear to be perfectly comfortable with the idea of government overreaching and engaging in a clear violation of the Fourteenth Amendment, among other things.

Liberty! Freedom! Constitution! Except if you're brown.

And finally, as the Deepwater Horizon disaster in the Gulf of Mexico rapidly buries any previous records for oil spills, dumping perhaps as much as 25,000 barrels of oil per day into the sea -- dooming jobs, wildlife and natural resources for decades to come, suddenly big government spending and 'redistribution of wealth' isn't so bad after all.

Republican lawmakers are quickly stashing their 'Don't Tread on Me' banners and tea bag hats in the nearest closet and demanding that the federal government come to the rescue of the Gulf States.

As documented by Dana Milbank this week, Republican David Vitter worried that BP couldn't do the job alone and that 'federal and state' government agencies pitch in.

Talk radio and Fox News, meanwhile, lied about the administration's allegedly slow response, implying that the government should be doing more -- even though we've been told by everyone of Ayn Rand to Sarah Palin that the free market ought to be able to handle these things on its own. (For the record, the administration has been on the ground and at sea since day one of the BP crisis.)

The governors of Mississippi, Alabama and Florida, all run by small-government Republicans demanded more support from the National Guard. Small government senators Shelby and Sessions promised the full support of the federal government.

Bobby Jindal, who famously joked about federal spending for volcano monitoring and tried to stop any Recovery Act money from entering Louisiana, isn't so concerned about federal spending now. He issued a statement demanding 'critical' federal government resources.

I think you get the idea.

But maybe we should just slow things down. Before we spend any government money, before we spread the wealth around and engage in generational theft, maybe we should start over. I know there's a crisis here, sort of like the one in which the economy was rapidly sinking into another Great Depression or the one in which American families are filing for medical bankruptcies every 30 seconds or the one in which there are 9/11-level deaths every month due to a lack of health insurance, but let's just slow down and start over.

In his University of Michigan commencement address in front of 92,000 people last weekend, President Obama made a rational, reasonable case for government. It was a far cry from Reaganomics and President Clinton's declaration about the end of big government. He said, 'There are some things we can only do together, as one nation... So what we should be asking is not whether we need a 'big government' or a 'small government,' but how we can create a smarter, better government.'

Perhaps, despite the inchoate rage of the tea parties and the posturing of the Republicans, they really do understand that we live in an era of unprecedented national crises and that with many of these problems only the federal government is adequately suited to repair the damage. If we could all meet up on these terms, on the terms of 'smarter government,' I think we'd be able to accomplish anything and mitigate any crisis.

After all, how bad can it be. The grandfather of the tea party movement, libertarian Ron Paul, receives government Medicare benefits.

Saturday, May 01, 2010

Tara Stiles: 5 Simple Ways to Live More Fully

Tara Stiles: 5 Simple Ways to Live More Fully:

A good teacher once told me that it's impossible to live every moment to the fullest. (Fun fact: she wasn't a yoga teacher.) She was right. We miss moments all the time. If we obsessed over fully living them all we might spontaneously combust, or appear intensely hyper and loony. Her simple message brought awareness to all the moments that we do miss, that we dull out on, ignore, or choose not to plug into. We tune out for all sorts of reasons. We're tired, depressed, uninterested, bored, or simply lost in thought about the million other places we need to be. We're not present. What does that even mean anyway? I know I have been put off in the past by so many new age teachings telling me in convoluted ways how to tap into the earth energy and blossom my inner bumble bee . . . or whatever. Sounds like more distractions competing for attention, when what we really need is a little quiet.

When we focus mostly on our immediate needs, wants and desires, we may achieve some of them, but hardly feel satisfied. When we feel connected to ourselves on a deeper level, we get happy. We feel safe. This doesn't happen when we're thinking about channeling our earth mother, or about how connected we are. It just happens when we get quiet, watch, and listen. It happens when we pay attention without thinking 'I'm paying attention.' Best of all, what happens then is we're able to connect with others and catch some of those precious moments that are always there. What's the point? In these small moments lives a vibrant, renewable source of inspiration and creativity that fuels all things interesting, inspirational, joyful and fun.

Ever caught someone's eye on the street and shared a simple smile? Sure, we all have. Those moments of innocence connect us deeply with our own potential and are available for us to enjoy whenever we choose. We only have to be willing to wake up.

5 Simple Ways to Live More Fully.

1. Observe. Take a look around. Watch people. Watch nature. Watch the sun and the clouds. The world is set up for us to observe. Check it out.

2. Take in. In order to take in we have to soften. When we have built up armor against all the bad things we think might happen in the world, we have a false sense of protection and have only built up isolation. We can start where we're comfortable and build from there. Allow yourself to take in a sappy romantic movie at home. When vulnerability becomes just another feeling like excitement, we become more familiar with it and can allow it to flow through us.

3. Respond. We have to train ourselves in response just like we train ourselves in taking in. Our reactions are colored with our psychology and our mood. It takes some conscious effort to clear muddled psychology and make room for authentic response. When we find this clarity, we get to experience a gratifying release and much deeper relating.

4. Pay attention. Paying attention to what we allow ourselves to pay attention to is a tricky thing. It's like being in two places at once, but completely worth the discipline. We can react mindlessly or respond mindfully. It's up to us. When we turn on our observation capabilities we become much more in the moment, and much more powerful. Psychic powers have been known to develop from consistent practice of paying attention. It's available to us all. It's all in what we choose to practice.

5. Enjoy. Without a sense of lightness, life can become quite a drag. Our days fill with mundane tasks we need to complete and secret desires that lead to anxiety. Have fun and enjoy your life. Might as well while we're here.