Re:Why Are There Still So Many Jobs? The History and Future ...
by kasey_junk on Monday August 03, 2015 @06:35PM
(#10000372)
> It's 0.1% on most transactions, and 0.01% on derivatives transactions. That's enough to kill the high frequency trading industry and downsize derivatives trading by 90%, based on Sweden's experience.
Most HFT transactions already experience this level of fee overhead. This will not cause HFT to go away, it will cause it to pass on more costs to the consumers of HFT. That is, every financial transaction will be more expensive.
This may have the effect of concentrating HFT even more than it already is as the regulatory burden favors bigger players.
There is nothing inherently wrong with that and I think the natural economics of HFT is already well on its way to creating natural monopolies in that industry, but a Tobin style tax will NOT cause HFT to cease to exist (nor do I think that is a desirable outcome).
Most HFT transactions already experience this level of fee overhead. This will not cause HFT to go away, it will cause it to pass on more costs to the consumers of HFT. That is, every financial transaction will be more expensive.
This may have the effect of concentrating HFT even more than it already is as the regulatory burden favors bigger players.
There is nothing inherently wrong with that and I think the natural economics of HFT is already well on its way to creating natural monopolies in that industry, but a Tobin style tax will NOT cause HFT to cease to exist (nor do I think that is a desirable outcome).