Re: Volatility

[GGard97342@xxxxxx]

In a message dated 03/04/2000 15:52:44 GMT Daylight Time,
veed0001@xxxxxxxxxxxxxxxx writes:

> Why does nobody (in government) ever consider taxation as an instrument of
>  stock market regulation? A system of stock market taxes would be effective
>  if they used the speed of electronic feedback rather than relying on the
>  speed of human (eg. the FED) feedback. Such taxes could deflate "bubbles"
>  before they "burst".
>
>  Harry Veeder


They do. In Britain it was called "stamp duty", but now has another name as
well as  there is an electronic variety. The rate is currently one half of
one per cent, and is on most transactions other than government issues.

May I remind you that in 1767 the American colonies developed a strange
aversion form stamp duties. Do I take it that that aversion is crumbling and
that we can expect a penitent US to apply for admission to the Commonwealth
which has Queen Elizabeth II as head?

Joking aside, I really think the colonists were right, and stamp duties are a
hindrance to capital markets, and probably cause, not cure instability. In
Britain they are now in essence a tax on the savings of ordinary people and
make the provision of pensions more expensive. But our current Chancellor is
unlikely to abolish them as taxing the elderly has been his ploy to eliminate
the government deficit.

Geoffrey Gardiner