If markets need taming interest rate rises are the wrong way to do it. Use targeted taxes instead.

But that leave’s the question of what is the answer? Is the answer to force many more into more debt, and to create insolvencies by increasing interest rates? Does that make sense? Or is the need to do something much more radical?

Isn’t the real need to increase capital gains tax to reduce the yield on exuberance?

And to have a financial transactions tax to slow markets?

Shouldn’t capital gains be charged on houses on death, at least?

And in places where favourable treatment is given to bond taxation shouldn’t that be withdrawn?

And what about an investment income surcharge to effectively charge national insurance on capital income to force a reduction in prices by reducing yield?

Reducing tax relief on pension contributions would also help by reducing flows into the market for the time being.

All these things and more are possible to reduce the pressure on markets. They would work. They would hit at the real issues. The amount of ‘collateral damage’ each would create would be minimal.

So why aren’t they being proposed? Ask the central bankers. Their failure to suggest them is a measure of their irresponsibility. And that of the governments to which they are accountable.

Candidly, central banks are in charge of monetary policy, not fiscal.

Further, the reason they’re worrying is because, as Spudda still can’t quite grasp, they need to withdraw that extra money supply created by QE.

21 thoughts on “MOAR TAX!”

  1. Today’s word of the day from Countdown’s dictionary corner lady:

    ultracrepidarian – someone who holds forth on a subject they know absolutely nothing about.

    Somehow quite apt I think.

  2. Investment income surcharge to force bond holders to raise yields? That could be about the most stupid “idea” he has ever had. I know the universe of Dick Tator’s stupid ideas is immense but still! His weekend with Rocco must have gone to his head

  3. CGT on houses at death? When there hasn’t been a crystallised capital gain? And they are potentially subject to inheritance tax? So double tax on houses? WTF! This might be his most stupid idea evahhhhh

  4. So pension funds are at risk and we want people to save more for pensions because the state will probably not be able to provide…. By removing tax relief on pension contributions! Yet another great idea from the biggest prick in Ely

  5. “Shouldn’t capital gains be charged on houses on death”

    Perhaps it’s true and is wife and children have left him!

    What’s the saying – death taxes are paid by those who hate their family more than they hate the taxman?

  6. But that leave’s the question of what is the answer?

    A feral apostrophe, from our highly-educated and all-wise professor? 🙂

  7. The Meissen Bison

    He seems to have a bit of a down on central bankers at the moment because of their failure to direct fiscal policy.

    The logic is impeccable: HE doesn’t restrict himself to talking about things on which he is competent to speak so why should THEY?

  8. “increase capital gains tax to reduce the yield on exuberance”

    But I thought he keeps telling us that increasing taxes doesn’t reduce activity? Or is that just the Financial Transactions Tax?

  9. Isn’t the real need to increase capital gains tax to reduce the yield on exuberance?

    Translation: I’ve got fuck all, so why should anyone else be richer than me.

  10. The solution to all our woes now seems to be for the Central Bank to dictate tax and spend policies. When did this happen?

    I don’t follow this very closely, but at some point in the past, wasn’t the solution for the Central Bank to apply monetary policy via “People’s QE”?

    And at some other point in the past (which came first?) was it not that they should apply monetary policy via “Green QE”?

    And now monetary policy is not good enough, the Central Bank should be applying fiscal policy instead. I’m not sure I’m keeping up with this. It doesn’t seem to have followed through a logical progression, just hopped from one idea to another.

  11. Isn’t the real need to increase capital gains tax to reduce the yield on exuberance?

    But that leave’s the question of what is the proper yield on ‘exuberance’?

    And that leave’s the question of whether the Prince of Ely has ever actually defined ‘exuberance’ as it relates to financial markets?

  12. Bloke in North Dorset

    I’ll bet he isn’t following up with “.. and that means we could reduce the tax burden bon the poor by reducing the lower rate of income tax.”

  13. He seems to have a bit of a down on central bankers at the moment because of their failure to direct fiscal policy.

    I am mad at the FA at the moment for not raising interest rates.

  14. “But that leave’s the question of what is the answer?”

    Murray Walker himself would have been proud of that.

    Can we send it to ColemanBalls? I’m sure Murphy would love to be in Private Eye

  15. Rob
    I am mad at the FA at the moment for not raising interest rates.”

    Give ’em a break. They’ve introduced goal line technology.

  16. Give ’em a break. They’ve introduced goal line technology.

    Which candidly shows they have absolutely no intention of rolling back QE, as I have candidly said all along.

    This is your last contribution here.

  17. I vote for a tax on masturbation. This would probably hit Dick Tater “hard” (fnarr,fnarr) given that he now lives alone.

  18. Ritchie is impressive, in the way that that dog who could say “sausages” on That’s Life was impressive.

  19. He thinks that all taxes are unpopular, but he alone will heroically go out on a limb to advocate more taxes – no Ritchie that 53.5% taxation rate on incomes above 150k is popular in the sense that a big majority like it. Also popular is that tax on congestion before the exemptions wrecked it. And tobacco taxes ( as the vast majority are benefiting from someone else killing themselves one day before hitting state retirement age ). There must be more.

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