CBOE looking to leave Chicago

Illinois “solved” its budget crisis by passing an increase in the state income tax from 4.7% to 7%, a 48% increase.

The Chicago Tribune reports that the Chicago Board Options Exchange (they run the service where people buy and sell options on stocks and other things) is looking to move out of Illinois.    Computers can be anywhere.   The CBOE doesn’t have a physical trading floor, so they could just as easily move to Texas (or Dubai)

http://www.chicagotribune.com/business/breaking/chi-cboe-holds-talks-with-other-states-about-possible-move-20110930,0,4502561.story

A lot of rich people make their living from the CBOE and would be glad to move their homes as well.    The NYSE also has a major operation in Chicago as well as the CBOT/CME.   According to the story, about 120,000 people in Chicago work in the financial trading business.

In the age of computerized trading networks, you can’t milk this cow any more.   See how fast Chicago could become Detroit…

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2 Responses to CBOE looking to leave Chicago

  1. prboylan says:

    This is a great example of why it is so important that the majority of taxes be collected at the state and local level. Illinois will now experience what happens when they insist on maintaining expensive government compared to other states. When you have 50 states trying to attract business and good citizens, competition will drive each state to provide more efficient government. But when the federal government collects the majority of the taxes and then redistributes the money to the states, there is no improvement in efficiency. States either fight it out with the feds in court (and ultimately lose because presidents appoint the judges), or the states morph themselves into the federal model (see California) to attract an ever larger share of federal support.

    The feds stepping in to prevent Boeing from opening a plant in South Carolina is another example. That was never really about Boeing. It was about stopping SC (a right to work state) from embarrassing Seattle, a liberal city in a predominantly union state. Such free competition cannot be permitted under the federalist system currently in force. Too many “blue” states would lose electoral seats as business emigrated to states with more efficient government and more freedom.

  2. Piquerist says:

    The mighty lion seldom falls to other beasts. It dies from the parasites destroying it from within.

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