(本文翻譯自 陳冲 每天打強心針的股市 2021-05-03)
Inotropic agents can be used in emergencies. What about inotropic agents every day? There is probably no answer from the perspective of clinical trials because no doctor would try this, and because it is not medically necessary as there is concern that inotropic agents would cause heart failure.
Four years ago when the Legislative Yuan still discussed whether to extend lowered tax on day trade, I published an article on the Economic Daily News on Jan. 24th 2017, titled “It might be a good thing to suspend the tax cut on day trade”, indicating that day trade, buying and selling a financial security within a day, is commonly seen in international market. But there are long-term investors and short-term traders in the stock market, if the government wants to cut half of the transaction tax in order to encourage more day trade, it should also clearly explain the rationale and evaluate the impact the policy may cause on the fluctuation of stock price and the price discovery function of centralized order market. Pity is that after the publication of the article, the Legislative Yuan still passed the proposal to extend day trade tax cut as the stock market dropped then and voices like “echoing public opinion” and “it’s act that impact people’s daily life” successively popped up. A rarely seen policy among the world which is actually simply an emergency treatment.
Time flies, the ratio of day trade to total trading volume has grown from less then 10% four years ago to more than 30% today, and even more than 60% recently. Trading value also soared from less than 100 billion to more than 700 billion last month. After four years of emergency treatment, how come we extend this ancient type of “National Security Act” policy for another five years? Those officials in charge, put your hand on your heart and ask yourself whether securities exchange tax is indeed neutral as they promised before? Some media and commentator on stocks doubt that stock market has become like a casino. Well, these doubts actually reflect same concern.
I am not against day trade or speculation because both are necessary elements in the capital market. However, differentiated or even discriminatory securities exchange tax will only aggravate the distortion of market functionality which will mislead the investors. It is really a matter worth pondering.
It is understandable that desperate measures be used as the stock market plunged both in price and volume just as inotropic agents used in emergency room to save patient. But the inotropic agents have been used for four years. If used for another five years, the stock market is not only like a casino, but also more like a hospice ward. Is it really good?
(Released on Appacus Foundation website, May. 3rd , 2021)