Ed,
This format is quickly getting awkward but I will repeat
all that has been said to order to restore trains of thought. In response to a message
I wrote, you wrote:
the same market that was involved in the
great depression?
The great depression was started when the government
would
not live up to it's promises in backing up banks. The market
didn't
'start' the depression, it was just a reflection of it.
I realize that
the market didn't really cause the depression but visa versa. I tend to over simplify
things sometimes because it makes people like yourself draw me out to examine old
thoughts and conclusions... I love the spirit of debate!!!
people lose
vast fortunes in the stock market everyday.
This really isn't true
- at least in the way you mean. Traders
and Speculators lose money all the time
because they are taking
major risks daily. Investors in for the long haul who
are well
diversified rarely, if ever, lose their fortunes.
I was working
for an investment company who specializes in pensions
in 1988, several months
after the crash of October 1987. I remember
asking one of the account managers
what the effect was of the crash.
He said that there was next to no effect on
their long term investments
('blue chips', utilities, etc).
Essentially,
the market, even if you take into consideration
all the crashes over the past
100 years, has, over that time
period, done better than investing in bonds or
stuffing money
in mattresses.
Ah but what do I mean anyway?. What I mean is the market is "sold "as
a get rich quick scheme, most of those who go in with that attitude, lose. I have
seen men drop $5000 in a single afternoon, it's not much more than a crap game at
this level. So the big money goes on the sure shots and the eager investors go for
the long shots. Just like the race tracks two kinds of betters... The fortune lost
is all the little bits added together... bottom line is I don't think the government
is the one that should be making this choice for me... , big mother needs to let
go...
The only way to make money in the market is for someone else to
lose it.
The market is just a giant poker game where the best bluffer wins !
This is fundamentally wrong. The market (and the economy as a whole)
is *not* a 'zero-sum' game. There is not 'x' amount of money, being swapped back
and forth.
Proof for the economy: Since there are ten times as many
people in the
world today as there were 200 hundred years ago, your hypothesis
would
mean that each person now has 1/10 the amount of wealth as they had
200 years ago. this obviously isn't the case, even in 3rd world nations.
Proof for the market: if 50 years ago, there was 100 investors,
but now there's
1000, you're hypothesis means that each investor
would have only 10% of their
original worth. Again, this is obviously
not the case.
Wealth grows
based on things like productivity, technology, etc. That's
why we all haven't
starved to death yet, and why we wont starve as
the population as a whole grows.
I
realize that there is not x amount of money swapped around but in the Stock Market
at any given moment there are x amount of assets represented by little pieces of
paper as a portion of the total asset Re: the company itself. Those assets actually
in many case are depreciating, becoming worth less in each passing day, If you are
on that particular reality page? However I also realize that a company that makes
a huge profit increases in value each day from an accounting point of view. Also
if you are looking at the market you really have to include all assets that are actively
involved in the economy, with current production adding value to the economy as whole
regardless of how the individual company performs. I could go on to argue that the
advertising, tourism and service industries don't produce any "value" for
the economy as a whole. I would also point out that you are not considering the adjusted
value vrs the dollar. In 1898 you could get a weeks worth of the newspaper for 1/2
cent. Today it is fifty cents per day! Then of course you got to consider that whole
import export factor and all the shit that get's destroyed by natural disasters.
Bottom line is your still shooting dice.
Now when you get an inflated market sooner
or later, you get a correction, I agree with most economists in saying that is the
case now...
Personally I say give me back my money, let me decide
This I agree with whole-heartedly, though I seriously doubt
the government
would ever give up that kind of money.
I know we are both right, we'll
be lucky to see a 10% return on those funds...
Who is going to decide which stocks to purchase?
The proposals
I've seen for 'privatization' would allow the individual to select from a list of
'approved' funds managed by private firms.
I find this mostly acceptable,
the government does not need to be an intermediate in these choices, even to the
point of approving which funds are acceptable...
The idea of the government
manipulating the price of stocks through ideological
investing may sound ridiculous
but that is exactly what will happen if this
plan goes through. This plan is
back door corporate welfare!!!
Again, I agree. I would suspect that
if the government were the ones doing the investing that they would abuse it. Not
only for corporate welfare, but also to further politcal
agendas (i.e., I doubt
they'd invest in 'politcally incorrect' companies such as RJR).
You
really don't think the government would in invest in RJR? They will as long as the
tobacco lobby keeps Congress's coffers full. remember, we are still giving subsidies
to tobacco growers while at the same time cracking down on retailers... . until next
time remember...
A free economy has to be free from the government !!!
John Galt jr
