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Financial Market Stability Tax (English)

The document "Financial Market Stability Tax” analyses some points about a tax aimed at making financial markets more stable.

In principle, such tax should be levied on the transactions that create instability and collateral risks for the market

The document highlights and examines the existence of the “financial circulation system”, focusing on the need for such a structure – that makes global exchanges possible – to be considered and managed like a vital infrastructure, as it goes for electric, information or railway networks. There must be rules to ensure its reliability and continuity. This approach is important, as financial market instability strikes harder on the poorest population groups and countries in the world. Like a body, when circulation becomes difficult, the organs that suffer the most from blood shortage are those already damaged or ill. Stabilising financial markets, thus, is a matter of basic justice.

The proposal of this essay is to introduce monitoring systems for inter-bank loans. Thanks to modern management systems used in computer or electric networks, problems can be anticipated, paving the way to early interventions aimed at solving them. Central bank involvement to maintain the financial circulation system could therefore be much more limited.

Two years ago some considerations were presented. In the meantime, a few more ideas have matured and evolved, and now can be presented in a more organic and in-depth way.