22 Oct 2017

Global Financial Transactions 2006-16 by country

Here's another table that analyses where the financial tranasactions listed by the Bank for International Settlements have been taking place since 2016. You can again find the data on a google sheet file here.

The US remains the biggest player,  followed by the UK, although the international CLS settlement system comes close at number 3 in 2016..

By looking at how the transactions in different countries have changed, you can see some very dramatic changes over time. The most striking change has been China, where transactions have increased from just under $134 trillion in 2006 to over $1.14 quadrillion in 2016, putting it at the number 3 slot. Germany has now dropped back to a mere $638 trillion in 2016 from a peak of $1.46 quadrillion in 2013. It has thus dropped behind Japan.

From my point of view, the fact that transactions can move around like that doesn't really change my basic conclusion. If we decided to impose a Global Transaction Tax, it would be be possible to provide a Basic Income at 50% of median income for every person on the planet with a tax of just 0.1%. The money is clearly there, it just doesn't get used to do the most important things for the planet.

And, as I have said over and over again, even the $11 quadrillion a year reported by BIS is almost certainly massively underestimated becauses the mammoth Options Clearing Corporation doesn't even get listed. So you might not even need to tax at 0.1%.

You might say that there would always be some place where people would try to provide a tax haven to allow traders to get away without paying even 0.1%. There are solutions for that too. You simply have to decide that any financial transaction that is not declared is not legally valid. I suspect that even the most greedy traders would be happy to pay 0.1% of the transaction value to ensure that their billion dollar deal was legally valid.

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