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Thursday, June 25, 2009
1:57 PM TweetThis
  • Former IBM CEO Louis Gerstner urges regulators to shut down the Wall Street casino by taxing daytrading gains by 80%. Six-months later, it should be 60%. And five-year gains should be tax free, he says. (via) That's one way to bring back buy-and-hold in a hurry.
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This news story has 21 comments:

  •  
    Idiot.
    Jun 25 02:01 PM | Link | Reply
  •  
    Seeking Alpha commenter coloneldebugger urges the person nearest to Louis Gerstner to give him an atomic falcon punch.
    Jun 25 02:02 PM | Link | Reply
  •  
    Great idea!!!
    Jun 25 02:03 PM | Link | Reply
  •  
    What? Rob Goldman Sachs and Morgan Stanley of millions in trading profits PER DAY? That is crazy talk.

    Drive the day traders to trade inside their self-directed IRAs to side-step the penalty? Makes no sense.
    Jun 25 02:04 PM | Link | Reply
  •  
    what happened? did this guy "hold" in the last downturn? what a brilliant strategy......
    Jun 25 02:08 PM | Link | Reply
  •  
    Isn't Gerster the IBMer who sold the ThinkPad to the ChiComs?
    Jun 25 02:09 PM | Link | Reply
  •  
    Will I get a tax credit for 80% of my intraday losses?
    Jun 25 02:10 PM | Link | Reply
  •  
    just another overpaid underqualified whiner who was beat up as a kid
    Jun 25 02:12 PM | Link | Reply
  •  
    Can this guy really be as stupid as he sounds?
    Jun 25 02:14 PM | Link | Reply
  •  
    What an awful idea. Taxes on trading profits in the U.S. are already high. All this would accomplish would be to drive traders out of the country (if the taxes are limited to U.S. residents) or drive public companies to trade on stock exchanges elsewhere. Liquidity in the market would obviously diminish tremendously and pricing would become less, rather than more, efficient.

    It is hard to believe that a man who has been an executive at several huge companies would come up with such a monumentally stupid idea. An idea which would accomplish nothing except reduce U.S. competitiveness. He is less hasty when it comes to punitive curbs on executive compensation, something he is more familiar with. The scary thing is that ideas of this sort could gain some traction with people being as confused by the recession as they are.
    Jun 25 02:17 PM | Link | Reply
  •  
    Gerstner is worth hundreds of millions, if not billions, so all he does is buy and hold stocks for over 5 years. If this passes, this will be a convenient way for him to PAY NO TAXES. Let's not forget the fact that HE MOVED HIS residency to Florida, after he retired which has a benefit of paying NO STATE TAXES.

    This is a joke. Meanwhile he wants to tax people who hardly have any money, barely getting by, who need to sell stocks in short-term to pay for daily living expenses. At the same time, he does his best to avoid taxes by moving to Florida and where he own long-term 5 year positions since he's worth a gazillion dollars.

    I bet Obama will love this idea because he HATES those evil short-term speculators.
    Jun 25 02:22 PM | Link | Reply
  •  
    One more reason that we have "black swans " occurring
    People like, Louis Gerstner, who should know better just don't
    get it,yet are given power and money to bungle up the world.
    Jun 25 02:27 PM | Link | Reply
  •  
    Self interested, maybe, stupid NOT, willing to sell his country down the drain for a few bucks, absolutely.

    On Jun 25 02:14 PM Windsun33 wrote:
    > Can this guy really be as stupid as he sounds?
    Jun 25 02:28 PM | Link | Reply
  •  
    Truly one of the more stupid statements I have seen. Where did he get the notion that the primary problem that needs to be solved is day trading? What are his motivations here? Is he jockeying for a position in government?
    Jun 25 02:31 PM | Link | Reply
  •  
    haha ya this'll fly really well

    I say tax the ubber rich, like Louis, 80% of their income. Not like anyone can't live off anything less than 50k, then reduce all gov't employee incomes to 30k

    all that disposable income can easily pay off the debt faster than any smart ass scheme
    Jun 25 02:41 PM | Link | Reply
  •  
    Yeah pesky day-traders, buying what people want to sell & selling what they want to buy. Should just buy & hold property....

    Seriously, why is the "long-term" is seen to be so much more worthy that the short ? So that you can be a long term holder of GM, AIG etc, etc. & get sucked into being fodder for the establishment?
    Jun 25 03:00 PM | Link | Reply
  •  
    I think either this guy was joking or hes a big fool. Try to tax the traders at 80% and you will see how quickly market liquidity will dry up. I mean come on why do people vilifie traders? What is wrong with being a trader and getting in and out of poitions can someone please explain because I am not smart enough to figure it out.
    Jun 25 03:03 PM | Link | Reply
  •  
    Wasn't the stock market organized to provide capital for companies who would then use the money to produce products that were desired or needed by our society? The market allowed ordinary people to participate in our capitalistic system. The trading of shares allows people to exit or enter these investments. I don't think it was organized to bet every day on the price movements or to form pools to drive stocks up and down. How many of today's regulations such as prospectuses, uptick rules, etc. etc. were instituted to control the casino mentality that has become the rule rather than the exception in our markets. Banks used to be simple businesses run by average people getting paid average salaries. Now with program trading, bundling mortgages, trading default swaps, etc. we have to pay bankers millions of dollars and then use tax payers money to bail them out when they are wrong. We no longer have capital markets we have a capital casino.
    What's wrong with a market that's not so "liquid"?
    Jun 25 03:50 PM | Link | Reply
  •  
    You are correct. Many markets would become a lot less liquid, as they should be!!! Many, possibly most, of the companies listed on the exchanges are scams whose sole existence is to support the upper management. If investors were forced to look at the long long term, they would only invest in companies they knew with a large degree of certainty were very well run companies with honest management. Poor management would have to move on or change behavior or else they would not be able to issue new shares. Good management would be rewarded. Pump-and-dumpers and day traders would find other "careers," and Seekingalpha.com would have to find honest people to submit articles.

    The government should probably go back on the gold standard too, fixing the price of gold, and forcing people to tender it. That would take care of the gold pumpers who also infest Seekingalpha.com.


    On Jun 25 03:50 PM kmf wrote:

    > Wasn't the stock market organized to provide capital for companies
    > who would then use the money to produce products that were desired
    > or needed by our society? The market allowed ordinary people to participate
    > in our capitalistic system. The trading of shares allows people to
    > exit or enter these investments. I don't think it was organized to
    > bet every day on the price movements or to form pools to drive stocks
    > up and down. How many of today's regulations such as prospectuses,
    > uptick rules, etc. etc. were instituted to control the casino mentality
    > that has become the rule rather than the exception in our markets.
    > Banks used to be simple businesses run by average people getting
    > paid average salaries. Now with program trading, bundling mortgages,
    > trading default swaps, etc. we have to pay bankers millions of dollars
    > and then use tax payers money to bail them out when they are wrong.
    > We no longer have capital markets we have a capital casino.
    > What's wrong with a market that's not so "liquid"?
    Jun 25 10:16 PM | Link | Reply
  •  
    Personally i think it is a great idea , but not in terms of economic policy or tax policy. I think the USA is becoming a not such a good place to live and invest but my wife is more optimistic . If this tax is put in to law , this may be be just what I need to convince her to move out of the US.
    Jun 26 08:48 AM | Link | Reply
  •  
    Maybe it isn't such a bad idea. It would certinly reduce the incentive for trading stocks and result in lower volume. this might mae it easier for individual investors t manipulate prices .
    Jun 26 09:30 AM | Link | Reply
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