Doug Kass: 15 Surprises for 2013-Stocks Get Crushed After New Tax on Financial Transactions Becomes Law
January 9, 2013 - 10:35am
Surprise No. 4: A tax on securities transactions is instituted in exchange for an increase in Medicare eligibility -- its implementation has broadly negative ramifications for financial stocks and hedge funds.
- Financial stocks underperform and miss profit forecasts.
- The transaction tax forces a further consolidation in the hedge fund industry.
- Hedge fund fees decline.
"Speculators may do no harm as bubbles on a steady stream of enterprise. But the situation is serious when enterprise becomes the bubble on a whirlpool of speculation."
-- John Maynard Keynes (when he first proposed a securities transaction tax in 1936)
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