Two weeks ago when expanding its debt monetizing vehicle, the SMP, to include the debt of Spain and Italy, one of the few appeasements offered to the public by "Europe" was the resolute demand that a transaction tax, aka Tobin, be enacted immediately if not sooner. Today, about two weeks later, the same behemoths of European structural stability, Germany and France, hoping the general public has largely forgotten all that was said in mid-August, has come out with the generous announcement that... they will propose a financial transaction tax. It is unclear if sometime between the first proposal and today's, Merkozy dropped the demand for Tobin Taxation, in order for it to be priced in once again as an indication of the fiscal prudence of the European leaders. And if so, will the market respond like it did last time around and plunge by 5-10%?
France and Germany in September will propose a tax on financial transactions to raise money for development projects, French President Nicolas Sarkozy said in Paris. “It’s normal to pay a tax when you buy a material good,” Sarkozy told ambassadors in Paris. “Why should financial transactions be the only transactions exempt?”
He said he wanted other European Union members to join the French-German proposal “so that we can get other countries to rally to it” at a G20 summit in Cannes, France in early November.
We can't wait until the next time European leaders propose a... transaction tax... again, and again, and again roughly every 2 weeks or so (after all between vacuum tubes and humans, the blended average duration of memory is about a few minutes) which will somehow pay for the tens, nay hundreds, of billions of PIIGS debt that is being purchased on a monthly basis.