• Flash Crash: If a financial speculation tax of 0.25 percent on securities trades had
been in place for just the 20 minutes of wildest trading on May 6, 2010, the day of
the stock market “flash crash,” it could have generated $142 million in revenue. That’s
more than $7 million per minute. Big-time investors might have thought twice before
placing their bets, instead of relying on computer-driven high-frequency trading.

• AIG Collapse: A financial speculation tax on the insurance giant’s $440 billion worth
of exceptionally risky credit default swaps would’ve amounted to as much as $1.1 billion,
enough to cover the annual salaries of 20,696 elementary school teachers.

• Greek Tragedy: When Greece cut a derivatives deal with Goldman Sachs designed to
conceal their dangerously oversized debts, a financial speculation tax would have raised
the cost of the shady maneuver significantly. A levy of 0.25 percent on the $10 billion
deal would’ve amounted to $25 million. In the United States and many countries around
the world, there is growing momentum behind proposals to place a very small tax on trades of stock, currency,
derivatives, and other financial assets. Such “financial speculation taxes” would have dual benefits: 1) greater
market stability by curbing short-term speculation that can lead to dangerous bubbles and 2) massive revenues
that could be used for urgent needs, like jobs, health, and climate programs.

Stabilizing Markets and Curbing Excessive Speculation•

Global Precedents: Financial speculation taxes in the UK and many other countries
have had little impact on productive economic growth or investment. Other G-20
countries are pressing the United States to institute such a tax.