and currency exchange-traded funds. All of these would have to be taxed together under a "non-currency" financial transactions tax (such as under certain proposals in the U.S. in 2009 which, although not intending to tax currencies directly, would still do so due to taxation of currency futures and currency exchange traded funds). Because these three groups of instruments are nearly perfect substitutes, if at least one of these groups were to be exempt, it would likely attract most market volume from the taxed alternatives. According to Stephan Schulmeister, Margit Schratzenstaller, and Oliver Picek (2008), restricting the financial transactions tax to foreign exchange only (as envisaged originally by Tobin) would not be desirable. Any "general FTT seems...more attractive than a specific transaction tax" (such as a currency-only Tobin tax), because it could reduce tax avoidance (i.e., substitution of similar untaxed instruments), could significantly increase the tax base and could be implemented more easily on organized exchanges than in a dealership market like the global foreign exchange market. (See also the discussion of tax avoidance as it relates to a currency transaction tax.) On October 5, 2009, Joseph Stiglitz said that any new tax should be levied on all asset classes – not merely foreign exchange, and would be based on the gross value of the assets, thereby helping to discourage the creation of asset bubbles. Non-tax regulatory equivalent One non-tax regulatory equivalent of Tobin's (very narrow original) tax is to require "non-interest bearing deposit requirements on all open foreign exchange positions.". If these deposit requirements result in forfeits or losses if a currency suddenly declines due to speculation, they act as inhibitions against deliberate speculative shorts of a currency. However, they would not raise funds for other purposes, so are not a tax. See also Bank tax Currency transaction tax Financial transaction tax Foreign exchange market Robin Hood tax Spahn tax Pigovian tax References Further reading External links Bank of Portugal report on the defense of the Portuguese Escudo in the European exchange rate mechanism BBC 7 November 2009 Lukewarm reaction to UK tax plan "Bibliography - Best Sources on Financing Alternatives, and Tobin Taxes" (includes economists on both sides of the issue of economic feasibility) from website of Tobin Tax Initiative Currency Transaction Taxes - Library of links to legislation, proposals, reports, articles and archives - from Global Policy Forum Debating the Tobin Tax, New Rules for Global Finance, 2003