Bloomberg News – Democrats Assail Wall Street with Plan That May Hit Mom and Pop

Bloomberg News – Democrats Assail Wall Street with Plan That May Hit Mom and Pop
Democrats are courting progressive-minded Americans by calling for a tax on Wall Street trades. If the party succeeds, the mom-and-pop investors they’re wooing could bear the brunt. The party supports a financial transaction tax but small investors would probably see an increase in the cost to buy and sell, which has never been lower. Tim Buckley, the chief investment officer of Vanguard Group, said taxes on financial transactions can backfire, upsetting a natural part of the market’s ecosystem. “When you put a tax on transactions, you risk damaging liquidity. As mutual fund investors we rely on having liquidity,” he added. “A drop in liquidity is bad for fund shareholders.”