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Randoms: Is a Trading Tax on the Horizon?


A polarizing issue arrives on the Street.

  • Earlier this week, I offered that I "see" a trading tax and a sugar tax on the horizon, which is entirely different than endorsing either. With a class war brewing, expect this particularly polarizing issue to encapsulate the percolating societal acrimony.

  • Case in point? How about Jim Cramer receiving death threats after last week's reported rant on CNBC (full disclosure: I didn't watch it) when he told folks they were "wrong and selfish" for not agreeing with his stance. A few days later, he reversed his view but that -- and Jim -- aren't the point of this post.

  • What is? Social mood and risk appetites shape financial markets. While the tape trades great, credit markets are buff, and there's a persistent (and curious) underlying bid, freewill is not a policy agenda that can be rubber-stamped into reality.

  • Sorta like the banks, right? You can flush them full of liquidity but you can't make them lend.

  • The single best example of the power of freewill I've ever seen? Man's Search for Meaning by Victor E. Frankl. John Succo turned me on to this book a few years ago and it's an inspirational read.

  • Minyan Peter Atwater broke down the Bank America (BAC) situation (the massive dilution). Watch this name as the reaction to news is more important than the news itself.

  • Goldman (GS) is also a lead dog for the financial sector, which is the lead dog for the tape. Note the lower highs for the stock, which has flown under most mainstream media radars.

    Click to enlarge

  • Could the trading tax be why this sector trades funky (even today, with a legitimate catalyst in BAC)? Or is it as simple as slowing seasonal trends? Counter-party risk? Real estate exposure? Gravity?

  • Either way, watch this sector like an Atlanta Hawk. If it flips the crimson switch -- and that's a big if -- the tape will turn tail in a hurry.

  • Minyans have asked that I unleash the "rant" (for lack of a better word) from yesterday's Buzz & Banter. Please know I'm planning on retooling it a bit and releasing it as an article next week. And yes, it did feel good to get off my chest.

  • Please take ten minutes -- when you have the time -- to enjoy our Minyanville conversation with Bobby Sager, a friend for almost 20 years and the inspiration behind NBC's The Philanthropist. I would also encourage Minyans to explore The Power of the Invisible Sun website; I've bought a handful of books for friends and family, as 100% of the proceeds benefit an amazing cause.

  • After years of requests, we've finally minted a limited edition of Hoofy and Boo Bobbleheads, which make for awesome stocking stuffers. At less than $20 for the pair, we're doing our part to provide "simple gift" solutions for family, friends and colleagues. Come on now, get yourself a pair!

  • S&P 1111. We've spoken about the basing vs. churning dynamic, as well as the "buy stops" that await on the other side. As Jack Skiba taught me almost 20 years ago (after I made him that awesome salad), never anticipate the anticipator.

  • I do have some S&P puts on, which I've been trading around (not very well, I might add). I'll always be honest, even when I've been off my trading game.

  • Be kind to strangers -- Do Something Joel -- even to the homeless folks who live in a cave; you never know when they'll suddenly stumble into billions of dollars.

  • MINYANVILLE EXCLUSIVE: An Interview with Ben Bernanke!

  • If you're on Facebook, be sure to join the Minyanville fan page to keep up with the critters and for some holiday giveaways. You can also follow us on Twitter.

And finally...

After months of anxious anticipation, Festivus is knocking on heaven's door! Tomorrow night, hundreds of Minyans will gather in force in the heart of Manhattan to chew through some BBQ, belly up to the bar, cut a rug with some Petty, Stones, the Beatles, and The Dead, play blackjack, enjoy auctions, share hugs and handshakes with our entire community, and most importantly, effect positive change for the dreamers, leaders and visionaries of tomorrow.

We've got a few slots left so if you haven't pulled the trigger, please feel free. And if you can't make it, please know that we appreciate any and all support as we unleash the benevolence of the Minyanville community in our annual attempt to be a part of the solution.



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