The article did a good job refuting the arguments in favor an FTT, up until this point: > In fact, we can show that the spreads must widen to be larger than th

The article did a good job refuting the arguments in favor an FTT, up until this point: > In fact, we can show that the spreads must widen to be larger than the tax itself being applied. If there’s a tax of 3 bps on a trade then no one’s going to trade at a spread of less than 3 bps. Why would you trade for a margin less than the tax you have to pay? Because you think the asset is going to increase in value in the future, of course! You might find the article's argument compelling if you are an arbitrageur. The firms spending millions on microwave antennas to trade a few milliseconds sooner might be frustrated that transactions with puny spreads are no longer profitable, due to a .03% tax. But we (society) swallow far more than that in other markets. How many labor transactions were rendered unprofitable (aka people choosing not to work) via income tax? How many retail sales never happened, because of sales tax? And these tax rates are four orders of magnitude higher than the proposed FTT! People buying and selling financial instruments is not four orders of magnitude more important to the economy than is labor, or buying goods. If anything, it's much less important. So I don't see why financial instruments should enjoy a privileged tax status. > Thus all of the revenue from the tax (and as I point out in that paper, this will be less than the revenue lost from other taxes as a result of the introduction of the FTT) will have its burden, and more, upon end investors. How? The math doesn't work out! I am a retail investor, in a high income bracket, and a .03% FTT would cost me $1-2 a month. There's no way you could get the proposed revenue figures from people like me. I have to conclude that the majority would fall on investment firms. The example investors, whose mutual fund does $85k in transactions a year, are either quite wealthy, or are being taken for a ride.