the visible hand

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Archive for December, 2009

France: 50% Tax on Bank Bonuses

Posted by ecoshift on December 16, 2009

I’m waiting to hear: US: 50% tax on bank bonuses…
Anyone want to give me odds?

France Plans 50% Tax on Bank Bonuses –

PARIS — Taking its cue from Britain, the French government plans to introduce a one-off 50% tax on bonuses awarded to bank employees next year, in a move aimed at soothing public outcry over excessive remuneration in the financial industry.

If approved by Parliament, the levy will apply to bonuses above €27,500 ($39,974), French Finance Minister Christine Lagarde said Wednesday. Expected proceeds will help fund the extension of state guarantees on bank deposits.

An aide to Ms. Lagarde said the levy would affect between 2,000 and 3,000 bankers working in France, but said it was too early to indicate how much the government could raise through the one-off tax.


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Gulf petro-currency latest threat to dollar hegemony

Posted by ecoshift on December 16, 2009

Gulf petro-powers to launch currency in latest threat to dollar hegemony – Telegraph

“The Gulf monetary union pact has come into effect,” said Kuwait’s finance minister, Mustafa al-Shamali, speaking at a Gulf Co-operation Council (GCC) summit in Kuwait.

The move will give the hyper-rich club of oil exporters a petro-currency of their own, greatly increasing their influence in the global exchange and capital markets and potentially displacing the US dollar as the pricing currency for oil contracts. Between them they amount to regional superpower with a GDP of $1.2 trillion (£739bn), some 40pc of the world’s proven oil reserves, and financial clout equal to that of China.

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UK: 50 per cent tax on bank bonuses

Posted by ecoshift on December 9, 2009

It was the government’s money anyway… / UK / Politics & policy – Banks hit by 50% tax on bonus pay-outs

Banks will be hit by a 50 per cent tax on bonus pay-outs, Alistair Darling, the chancellor, said in his pre-Budget report, in a move that will inflame bankers but is likely to be welcomed by the general public.

The first £25,000 of bonuses will be exempt from the tax.

The Treasury estimates that the measure – which comes into immediate effect and runs until April 5 next year – will affect 20,000 bankers. Lord Myners, the City minister, recently estimated that 5,000 bankers earn more than £1m in bonuses.

“We hope it will be a disincentive for banks to pay bonuses,” said one Treasury official.

The windfall tax – which politicians argue is justified, as banks have generated excess profits as a direct, or indirect, result of the bail-out of the banking system – will apply to all banks and building societies, including groups that operate in the UK under a European Union branch system.

The tax, to be paid by banks, will be levied on top of the marginal tax applied to individuals’ bonuses.

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“Wake up, gentlemen”

Posted by ecoshift on December 9, 2009

After a certain age, financial rewards must lose their glitter…

Wake up, gentlemen’, world’s top bankers warned by former Fed chairman Volcker – Times Online

One of the most senior figures in the financial world surprised a conference of high-level bankers yesterday when he criticised them for failing to grasp the magnitude of the financial crisis and belittled their suggested reforms.

Paul Volcker, a former chairman of the US Federal Reserve, berated the bankers for their failure to acknowledge a problem with personal rewards and questioned their claims for financial innovation.

On the subject of pay, he said: “Has there been one financial leader to say this is really excessive? Wake up, gentlemen. Your response, I can only say, has been inadequate.”

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China Exports May Be Cut by Climate Plan

Posted by ecoshift on December 8, 2009

Hey, what about free trade??

China Exports to U.S. May Be Cut by Climate Plan –
By Mark Drajem

Dec. 9 (Bloomberg) — Legislation pending in the U.S. Congress to cut greenhouse-gas emissions may reduce imports of Chinese goods by 20 percent, a World Bank study said.

The provision, included in the measure passed by the U.S. House in June, would tax imports from countries that don’t enact curbs on carbon-dioxide emissions.

Senator Sherrod Brown of Ohio and Representative Sander Levin of Michigan, both Democrats, say any legislation in the U.S. to limit pollutants must include the so-called border measures to tax imports. The Senate hasn’t yet acted on the greenhouse-gas measure.

“People haven’t thought through the full implications of those measures,” Aaditya Mattoo, a World Bank economist and one of the paper’s authors said in an interview.

The threat to imports should be part of what drives negotiations at global climate talks in Copenhagen this week, said Scott Paul, the executive director of the Alliance for American Manufacturing, which represents the United Steelworkers union and U.S. Steel Corp.

“It shows that the right border measures would be effective,” Paul said in an interview. “So it would be in the interest of India and China to participate” in any global agreement to cut emissions, he said.

The U.S. imported $338 billion in goods from China in 2008, more than from any other country.

Advocates say the fees are needed to prevent price- undercutting by manufacturers in countries that won’t match U.S. or European Union climate-change standards. The World Bank study said U.S. and EU manufacturers of steel, cement, plastics, paper and chemicals have reason to be worried.

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