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This week's Defender's of Social Security Blogathon prompted me to try to find something that would allow me to explain clearly, concisely and completely to others why chained CPI is so harmful. What I found is a paper from the Center for Economic Policy and Research titled, "The Chained CPI: A Painful Cut in Social Security Benefits and a Stealth Tax Hike".

Not only do they clearly explain why chained CPI hurts seniors, but also how it raises income taxes on low and middle income taxpayers (something I did not know).

Follow me below the fold for the highlights...

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What am I looking at?

The above chart -- courtesy of Nanex -- "The Rise of the HFT Machines" shows just how much high-frequency trading (HFT) has affected stock market trading volume from January 2007 to January 2012. The different colors represent the different markets.

So what?

1. Generally, watch how much the trading volume increases from 2007 - 2012.
2. Specifically, watch what happens to the volume on August 5, 2011

What happened on August 5, 2011?

Standard and Poors downgraded the U.S. credit rating

There was a huge increase in activity, again, so what?

Greenbiz explains it this way:

...automation combined with high-frequency trading strategies has disrupted the smooth functioning of the markets because the computers react long before people can react; as such, the computers are in many ways dictating consumer sentiments before such feelings surface, in essence leading investors to adopt trading behaviors instead of the other way around.

I need more than that to care

Remember this? Knight Capital (KCG) almost ceased to exist because of computerized trading run amok -- Granted they're the ones installed the program, but it doesn't take too much imagination to see it happening again (and again and again)

Specifically, what is High Frequency Trading?

High-frequency trading (HFT) is the use of sophisticated technological tools and computer algorithms to trade securities on a rapid basis.

What are the benefits of a Financial Transaction Tax?

I'll let Salavatore Babones from Truthout explain it:

"An FTT accomplishes two goals. Most importantly, it raises money. Unlike most taxes, however, it does so in a way that is arguably beneficial to the economy as a whole. While most taxes involve some sacrifice from taxpayers in order to promote the common good, the FTT promotes the common good directly through the "positive externalities" it generates for the economy. Positive externalities are improvements to economic efficiency that result from changes in behavior. A well-designed FTT would discourage speculation and computer-driven high frequency trading in financial instruments. That would reduce market volatility and increase access to capital markets for ordinary borrowers and investors. Even if an FTT raised no money, it would still improve the economy."

How much money would it raise?

I've seen estimates anywhere from $50 billion to $350 billion

Who opposes it?

Besides the financial industry, Republicans and Grover Norquist? The White House  (yes, I'm citing a year old article but here's more recent news)

Why?

The argument I see over and over is that it would drive trading overseas and hurt our financial markets

Specifically, what legislation are we talking about?

Keith Ellison introduced H.R. 6411: Inclusive Prosperity Act. This bill would raise up to $350 billion through a small tax on stock, bond, derivative and currency trading.  It's been referred to the House Committee on Ways and Means

I've read this and still have no idea what you are talking about.

The article I read that really made me care was The Better Bargain: Transaction Tax, Not Austerity by Katrina vanden Heuvel of The Nation.

Pretend you're standing on a Soapbox, what would you say?

This would bring stability to the market that may just help prevent another meltdown. Oh, and a Financial Transaction Tax damn well better be on the table before a "Grand Bargain" that takes services away from the poorest and the neediest in this country

What can I do?

Contact your congressperson and ask that they support this bill (You can see who the cosponsors are here) And talk about it, this needs to become part of the regular conversation when we discuss "Grand Bargains" and such.

Discuss

Sun Apr 11, 2010 at 08:34 AM PDT

"...By The Standards of the Time"

by dave1042

From an article by Erin Allday in today's San Francisco Chronicle,  according to Jeffrey Lena -- a Berkeley lawyer for the Vatican -- then-Cardinal Joseph Ratzinger was handling requests to defrock Stephen Kiesle "expeditiously... by the standards of the time" (emphasis mine).

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Wed Nov 04, 2009 at 07:17 AM PST

I want the FAQ updated

by dave1042

I used to give a monthly donation to Bill in Portland Maine for Cheers and Jeers but then I lost my job and had to stop it.  But today, after hearing about Prop 1 passing in Maine, I really wanted to start my contribution again -- sadly at a lower amount than before but still, I can afford $5 a month ...

How to do that?  I went to the FAQ and for the life of me, could find nothing about contributing to Bill.  A less persistent person could have just given up, but not me.  I used the awesome search functionality of Daily Kos to find this diary which told me how to contribute.  But it shouldn't be that "hard"... Why not add this info to the FAQ?

So I hereby request to update the FAQ to add the information on how to contribute to keep Cheers and Jeers going (you'll find that info below the fold) to the FAQ.

Poll

Should the FAQ be updated so we can easily find out how to contribute to BiPM?

45%18 votes
5%2 votes
22%9 votes
27%11 votes

| 40 votes | Vote | Results

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This is good news:

According to the San Francisco Chronicle:

A federal judge refused today to dismiss a lawsuit challenging California's ban on same-sex marriage, setting the stage for the nation's first trial on the constitutionality of a law allowing only opposite-sex couples to wed.

Ultimately, this piece of crap proposition will be overturned at the ballot box as bigots become more and more in the minority, but it's nice to know that the courts will at least look at this.  The basis of this suit is that the real purpose was to strip a historically persecuted minority group of rights held by the majority.

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Sun Jun 21, 2009 at 10:15 AM PDT

Pete Hoekstra isn't Alone

by dave1042

Pete Hoekstra took some (is still taking) well deserved heat for his now infamous tweet:

Iranian twitter activity similar to what we did in House last year when Republicans were shut down in the House.

Twitterers (twitteries?) had a field day mocking him:

ciolino @petehoekstra Today I poked my finger on a hanger. Now I know what all those aborted babies go through.
ceedub7 @petehoekstra I got a splinter in my hand today. Felt just like Jesus getting nailed to the cross.
netw3rk @petehoekstra Someone walked in on me while I was in the bathroom. Reminded me of Pearl Harbor

Also, some clever person created a website called "Pete Hoekstra is a Meme"

Poll

Favorite @PeteHoekstra Tweet

15%7 votes
39%18 votes
32%15 votes
2%1 votes
0%0 votes
10%5 votes

| 46 votes | Vote | Results

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Thu Oct 16, 2008 at 01:44 PM PDT

I Voted No on Proposition 8 Today

by dave1042

I gave money yesterday (donate by Sunday and your donation will be doubled). I've seen several diaries already about the need to defeat this but here is one more, because these bigots need to be stopped.

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Apparently Scott (First Dude) Palin is the only non-state employee who gets free use of a Blackberry paid for by the state.

Courtesy of the Alaska Politics Blog

Poll

Does Todd Palin need a State paid for Blackberry?

18%31 votes
3%6 votes
30%52 votes
40%70 votes
7%13 votes

| 172 votes | Vote | Results

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Sat Sep 20, 2008 at 03:24 AM PDT

Another McCain Gaffe

by dave1042

I've lost count of his gaffes (lies?)and if this has been already diaried I apologize, but John McCain continues to be confused.  At the Grand Rapids "Town Hall" on Sept. 17th, McCain -- trying to pump up Sarah Palin's non-existent national security credentials -- gets it completely wrong.

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This is rushed, but I think Kos' take on the front page is wrong.  

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It wasn't that long ago (4 years to be exact) when Republicans had no problem putting lipstick on a pig.

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Mon Sep 08, 2008 at 02:20 PM PDT

With Apologies to Tommy Flanagan

by dave1042

Hello, my name is Sarah Palin, and I'm a member of Pathological Liars Anonymous. In fact.. I'm running for Secretary uh vice-president of the organization!

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