wall is a fag

>helps the economy in some way

well, it, umm, errr, lolidunno

don't question capitalism, asshole

>implying the stock market isn't incredibly beneficial despite recent troubles.

gambling is designed as a form of entertainment where as investments are designed as a source of income.

>>1070827
isn't this exactly what OP was trying to get you to explain?

>Educate me on how the Stock Market is not institutionalized gambling

I honestly don't know.

Bueller? Bueller? ...................Bueller?

I have this great idea but I don't have startup capital. Oh woe is me whatever shall I do

>good day sir. I am an extremely wealthy business man. I will give you lots of money if you promise me a portion of your profits when your idea is implemented

oh joyous day!
-----

that's the theory anyway

Idunnolol

Stock market is fine, allows corporations to raise capital. The problem is corporations, or officers of corporations who sacrifice long term viability of their corporation for short term gains.

Also, the derivatives should be eliminated. There's 1.4 "quadrillion"(1400 trillion) dollars in the american derivatives market alone. Note that there's only 8.36 trillion dollars in existence as of 2009.

well I might be wrong but I believe that actual support to the industries in form of new money is introduced by new share issuing. The rest is gambling but it has to happen as well because someone's gonna value the industry and I'd rather it was the public (market) than some Kim Yong Il type who sooner or later would start to believe he controlled the weather as well

so the only response(s) is, to produce money for a loan.

thats it?

>>1070877
That's called getting a loan, no stocks are necessary.

>>1070917
Why not just get a loan and not bet on it?

>>1070932
Again, need capital, get a loan.

Allows people to invest money into a business. Business does well, person makes money, or vice versa

I'm not clear on commodities though, that shit seems like gambling

>>1071014
Have the business formally lend money from the person. They pay interest, problem solved, and the business is not covered by the "Whoops, our company broke, sorry" rule.

>>1071014
Used to be that commodities were only sold to people who actually used them. They unregulated that market so anyone could temporarily buy 1000 tons of oranges and hold them for a few days and then sell them for a profit. Passing the cost on to the consumer for the right of a few hundred random guys to buy/sell commodities at incrementally higher prices.

It's one of the main driving forces of inflation over the last decade.

>>1070983
Because with a loan, if the idea doesn't take off, the person who took out the loan is still on the hook for the money and will probably not be able to pay it back. If he file for bankruptcy it's a net loss for everyone

with an investment, the investor is out the money, but if he was making rosy investments in startup companies he was rich to begin with

>>1071024

That's what the bond market is for.

>>1070978

no the shareholders get the option to join in on the new issue but they have to open their own wallet. If they don't want to jump on, they can give away their rights to issue new shares at least this rule is followed in some instances. I don't know what happens if there are some left over after that --I'm a newb and my knowledge is not complete

>>1070978
Given that the govenment can simply type in a computer (much like a cheat code, ironically) and create virtual money, then lend it to a company, have it paid back and then "destroy" it, where do stocks become necessary?

>>1070978

It's not actually a loan, people who buy shares buy ownership in the company and can vote on company decisions that affect them as shareholders.

>>1071037
>Used to be that commodities were only sold to people who actually used them.
Why not keeping it theis way and prohibiting the purchase and selling of stuff that does not exist or will exist some time in the future (but might not)?

>It's one of the main driving forces of inflation over the last decade.
So WHY do we keep doing it?

>>1071041
Granted, keep it. Still, not quite stock market business.

>>1071039
If the company does not take off, then the investment would be just as lost and everyone would lose just as bad.
If it fails, it failed, then I guess it wasn't really a good idea, was it?

>>1071024
I think you mean private person lends to the business.

Stocks are just certificates of derived value. The business isn't looking for a loan. Rather its the private person wanting to give that business money in support and in exchange for said stocks

>>1071070
But the companies rarely give out enough stocks so that someone could call the shots.
The average person (the one that really matters) would never hold more than 0.00005% of the company, which equals to nothing.

Moot point.

>>1071088
>The business isn't looking for a loan.

Too much responsability, I guess?
Well, too bad, get a loan or gtfo I say.

>>1071095

Actually, if one had enough capital, they could buy a majority vote in a company by going to the open market. It's how hostile corporate takeovers are done.

>>1071103
you putting the burden on the business when its the private person wanting to give the money. Some business refuse to accept.

>>1070917
this is the case whenever banks are allowed to make loans. Don't bash derivatives just because it sounds weird to you. Derivatives allow financial institutions to properly hedge against risk.

Yes, there should be limits to how much firms can be leveraged, but the idea that all derivatives can be outlawed is ridiculous.

>>1071084
>If it fails, it failed, then I guess it wasn't really a good idea, was it?
The point is that there is less risk foreveryone involved and less potential for collateral financial damage the other way

there was kin of a thing 2 years ago involving a bunch of people that couldn't pay back loans. Don't know if you heard about it but it caused some problems

>>1071095
but that person still retains rights to their share of the company's profits, which is the point of a stock.

>>1071037
speculators buy when commodities are plentiful and sell them when they are rare. they make a profit, but stabilize prices so that shocks aren't as bad as they could be. This is good for the economy, and has no relation to inflation. Price shocks, however, are directly related to inflation.

>>1071084
>Used to be that commodities were only sold to people who actually used them.
Why not keeping it theis way and prohibiting the purchase and selling of stuff that does not exist or will exist some time in the future (but might not)?

We need a futures market, for price "lock-in", so that contracts can be drawn-up, reviewed and approved and so transportation can be arranged in advance, etc, etc,

But, I agree it should be limited only to Industries that need the items, and not gamblers/banks running-up the price (That's why gas prices are high). To impose that limit, it would require reform legislation and leaders with enough guts to put it in place. Lobbyists keep that from happening.

>>1071180
>this is why gas is so expensive

this is not the case. it makes no sense for speculators to hold on to an asset if the price goes up. speculators stabilize prices, not drive them up.

oil is expensive because of increased demand, not some phantom scapegoat.

people with no grasp of economics should not be in charge of the economy.

>>1071132
Because everything ended up on the stock market, was sold overpriced and then everyone realized it was not worth it, it's called a bubble.
Also, the loans were deeply incentivated to people that could not affort it so the bank could take the loan to the stock market.
Your argument is invalid.

>>1071130
Derivatives are completely stupid, and even people who deal it don't know exactly what the fuck they are doing.

>>1071145
They do if the company decides to. If not, no.

>>1071164
And they do so while adding no value whatsoever to anything that they touch.

>>1071248
So demand coincidentally quadrupled the moment that commodities were unregulated? Wow. Where did all that demand come from, if not from speculators?

>>1071180
Shoot the lobbists.
No. Seriously. Fucking shoot them. They have done enough to fuck up every living person in this earth.

I agree with the lock-in. Buy what you need or is involved in your industry and then USE IT. Otherwise you are not only inflating prices but deprivingother business from the items needed.

>>1071248
And even people who "understand" economics end up fucking shit in epic proportions.

>>1071248
It's complicated. A firm drives-up the price, hoping others see the price go up. Others buy-in, the firm sells it's now more valuable shares....and they often DO hold onto them, in large hedge-funds, when the fund has a higher holding value, more investors (suckers) buy into that fund.

>>1071248
>this is not the case. it makes no sense for speculators to hold on to an asset if the price goes up. speculators stabilize prices, not drive them up.
False. I would use the uranium speculation as an example. No one buys uranium at spot prices. Contracts for fresh fuel are done 5-10 years in advance. A known quantity will be consumed because we know exactly how many plants there are and what their specific fuel requirements are. So why did the spot price double?

Because whether a stock goes up or down is based upon measurable fundamentals.

Furthermore, you can hedge your positions easily by selling calls or puts on any stock you own, limiting any downside.

Furthermore, you are a fucking idiot liberal who thinks the market rising the past year had anything to do with your messiah Obama and wasn't just the fed pumping trillions of cash at 0% interest into the market and anonymously buying tbonds at every auction to produce the illusion of a recovery.

newsflash, the government manipulates the unemployment numbers and inflation numbers.

>>1071302
Because someone wanted to speculate on it, simply because they could.
Nuclear plants didn't pop-up out of fucking nowhere, there was not an uptick on the demand of ICBM's. Pure. Simple. Speculation.

>>1071312
So people get fucked for no value produced.
Remind me again why we don't lock up people who do this?

>>1071296
>And even people who "understand" economics end up fucking shit in epic proportions.

PROTIP: nobody understands economics at ALL. It's all bullshit.

<--- this is how wallstreet works

>>1071331
>Because whether a stock goes up or down is based upon measurable fundamentals.
Like OMG EVERYONE IS SELLING SELL TOO BECAUSE EVERYONE IS SELLING.

>Furthermore, you can hedge your positions easily by selling calls or puts on any stock you own, limiting any downside.
Then why did we crash? Like, a bajillion times?

>Furthermore, you are a fucking idiot liberal who thinks the market rising the past year had anything to do with your messiah Obama and wasn't just the fed pumping trillions of cash at 0% interest into the market and anonymously buying tbonds at every auction to produce the illusion of a recovery.
They did so to fix the mess that was created by the stock market in the first place.

>newsflash, the government manipulates the unemployment numbers and inflation numbers.
Not even marginally relevant to this discussion.

>>1071338
>Because someone wanted to speculate on it, simply because they could. Nuclear plants didn't pop-up out of fucking nowhere, there was not an uptick on the demand of ICBM's. Pure. Simple. Speculation.
So then you just completely destroyed your point that speculation stabilizes prices. Good job.

>>1071356
>Not even marginally relevant to this discussion.
>implying those numbers don't influence the perception and ultimately how people invest.
ohyou.jpg

>>1071356
not the guy that you're replying too....but its not a fix

when the stim money runs out, or we start to feel the expenses of low interest rates trickle down, down go the numbers. when that doesnt work and they move to quantitative easing....good fucking bye america

OP here, logging out.

This was quite a very nice discussion, and I'm quite happy that I found a decent ammount of people who could agree with me, and that those who made opposing arguments reduced to "the market fixs itself" and "adds money to the pot", both arguments that were disproven time and again by expert aconomists.

I'll repost this later, maybe get some different people in the discussion and shizzles.

But really, this went far better than expected.

In return, mindfuck. Also, sort of a comprehensive scheme on the market of derivatives. If it does not make sense to you, congratulations, you are clinically sane.

>>1071362
Was exactly the point that I was trying to disprove. It only fucks shit up.

>>1071380
>trickle down
>Reaganlaughing.jpg

>>1071401
yeah you'll be laughing when it's 50 fucking dollars for a loaf of fucking bread :|

>>1071380
You can only stimulate that which is not working pretty well or not at all.

>>1071424
my point is that eventually you run out of stim money, and you're back to square one.

>>1071356
What does the market crashing have anything to do with your position if you hedged it with calls? Nothing, you would have lost not even 2% of your position if you did it correctly.

They did that to fix the market? No. You are a fucking idiot, once again. They did it to prevent a natural correction due to an unnatural and unsustainable run up. They stopped a recession from happening for a short period of time, within 1 year the market will correct itself with more force this time and no bailouts are going to stop it.

Apple is not worth $250 a share. It's not. People like you are going to find that out the hard way very soon.

You don't think inflation and unemployment numbers have anything to do with capital markets? Holy fucking shit.

You are probably one of the people who thought the spike to spy 105 was a "computer glitch" or some shit like that. No. No trader believed that at the time or now. Sort of strange less than 2 weeks after that "glitch" spy hit 105 again.

SPY will close below 105 today and probably gap down massively depending on spain and north korea.

There are literally thousands of methods you can use to evaluate a stock as well as the market in general, and then use options/futures/forex to hedge it giving you a very small downside and unlimited upside.

If you bet only red on roulette, you are going to be broke very soon, 100% of the time.

>>1071430
So shit fails, we spend a fuckton of dollars for no measurable result other than a short-term ilusionary response?

It's as if you were actually trying to help my argument in the first place.

>>1071272
>Because everything ended up on the stock market

lol no. Derivatives are not the same as stock. Plus it would have been just as bad if they all defaulted even without all the reselling of assets

also if you believe that the stock
market is "legalized gambling" I don't see how you can not see loans as the same thing

>>1071444
i agree it wasn't a glitch, but i don't think we'll close that low today.

we're just seeing the first quakes here and there. give it time before the whole thing implodes.

>>1071453
that was my point exactly.

i was pointing to
>They did so to fix the mess that was created by the stock market in the first place.
it didn't fix anything.

>>1071444
If it is SOOO TOTALLY EASY to predict, why are you not wealthier than everyone else? Why doesn't everyone that get's in on it comes out the other way completely rich?
In the end, it's a guess. Face it.

The problem is not the functioning of the market. IT'S THE MARKET ITSELF.

>>1071472
Oh.
Why then.
Well.
Okay.

>>1071389
>those who made opposing arguments reduced to "the market fixs itself" and "adds money to the pot"

you know you could have just said "I haven't read the opposing replies yet". There's no shame in that

>>1071389
It's a method of opening up a company to more investors.

>>1071319
Yes, speculators are buying uranium now (when it is cheap) in anticipation of increased demand in China, India and Russia when they one day need nuclear power plants.

Taken from the Financial Times:

>The uranium market is one that is like a wild roller coaster, and many of the equities associated with it can make investors queasy from the ride. These equities are no different from many mining stocks; they have to be looked at very closely. Uranium trading was starting to become more stable, or so it seemed. Then, just as fast as it calmed down - bam! - it went right back up. The uranium price surged $5 to $29 in just two weeks last year.

>After the market woke up and new buying came in, the ultra-precious metal's price climbed another $4, which set the highest uranium price since the early 1980s. The new speculation was triggered by growing expectations that China, India and Russia were planning to build new reactors and more reactors would cause a run on the limited supply of uranium. This speculation may well be right, if the International Atomic Energy Agency (IAEA) stats are even close to true.

When they sell this uranium in the future, it will cause the price to be lower than it would be (as they increase supply) and hence, a much greater price shock is prevented

speculators are good.
lrn2econ

>>1071461
>>1071481
because I am usually too fast. I am very wired in to all sorts of news.

For example, if you lurk /g/ you knew fermi was shit as far back as november.. but nvidia didnt get an official downgrade till months after.

I did however make 4900 shorting it before earnings, and i sold way too early, could have made 10k that day.

Yesterday.. I lost 1100 shorting spy before it dropped to what would have been a 2k profit for me had i not got stopped out.

today.. i was down 1100 again. but I'm not selling as i expected it to hit or slightly break the pivot point before tumbling but it looks like it is testing the lower trendline right now, I'm down 700 but expect to be in the green before close and I am holding overnight.

North Korea could set the recession off with a thunderous bang of thousands of artillery shells it has had pointed at south korea for decades. Even if it doesn't the fears alone will drive us down overnight as well as spain being the next eurofag country to go into crisis.

Just play FAZ-FAS call/put spreads in this volatility.

have a loose stop, you should make more than you lose.

Also you can short both FAS and FAZ for short periods while they are similar in price. Add both their prices today at open- 37.50 and add their prices at the close 36.99. They decay so you can make money that way as well if you're leveraged.

If you're a smart mother you can try to actually play broad market moves by going long of them, although I only recommend it when you have confirmed bear or bull signals which we don't have right now.

OP here. Back again reviving this shit.

>>1075593
>>1071896
You do realize that you made huge efforts and put in a considerable ammount of thinking on something that added no value whatsoever to the economy, to the people or to the industry.

So much more you could have done, rly.

>>1075955
OP again.
I think a new thread may be needed. This one, albeit not having derailed much, has no other former participants online.
What do...

When a promising company wants to get quick capital, they offer an IPO on the stock market and collect funds to expand their business. But, yes, the stock market has largely become a useless tool for individuals to get obscenely rich with no benefit to the larger economy, or, even to its detriment.

>>1076248
If a big company wants a considerable ammount of money RIGHT FUCKING NOW something is very wrong and that company probably should not get the money in the first place.

>>1076310
CEO's don't expect more than 1-2 years to make all they can, and it depends on how much profit growth they can achieve.

The quickest way to good quarters? Selling capital and slashing labor costs, even if the company's fucked afterwards.

>>1076333
Again further proving that companies give absolutely no fuck whatsoever to anything other than profit.

Remind me of why we don't regulate the fuck out of them?

Banks have it better than Wall Street.
They can leverage their own value multiple times, and if they win, the profits are theirs. If they lose, their liabilities are covered by the FDIC, so they only have to cover salaries, taxpayers cover the rest.

This time around, taxpayers covered salaries too.
We didn't even get a thanks.

>>1076366
OP here.
I'm not openly saing we should regulate this. I'm sort of implying it is fucked up, at best.

My main point is: How can ANYONE be OK with this? How can YOU be totally okay with this?

Not much to do except NOT play their games. 401K contributions give them a constant influx of cash to play with in the market. Retail investors would be better off just tossing their cash out a car window on the freeway.

The results mindsets of investors is insane as well. Coney Island is/was shut down because it couldn't post double-digit profit growth reliably, it was growing profit, just not fast enough. Being limited on real estate and such is no excuse to investors who want the big returns. Growth over time isn't even on their radar.

>>1075593
you guys realize that you're not better that a nigger on welfare?
you are extracting wealth from the real economy. without a counterpart, you're not doing anything productive, you're the one creating bubbles
driving prices up each time the good pass through your hands.
you're more dangerous than a crack head on rampage.

>>1070792

Stocks are sold when companies want to raise money to further their product or service. They fluctuate based on their profits (called Earnings Per Share, which is mathematically calculable from Net Income/Shares Outstanding) and many of them pay dividends (a sum of money) either annually or quarterly based on how many shares you own.

>>1076573
Even if the nigger spends it on drugs, alcohol and prostitutes, he's giving money to other people, and thus making the economy roll.

Ok, on drugs it will probably eventually go to mexico or some shit, but the point is that SOMEONE gets a job.

>>1076610
>Stocks are sold when companies want to raise money to further their product or service.
Get a loan.

>They fluctuate based on their profits (called Earnings Per Share, which is mathematically calculable from Net Income/Shares Outstanding)
Then why does it bubble and crash, like, all the time?

>>1076610
That's why you short 150% of the float with shares you'll never actually purchase or own, they're just paper.

You sell 100 shares at a time every few minutes, so the price has little opportunity to rally. Over months, you can devalue the hell out of stocks so the company can't even issue new paper to fund growth.

It's beautiful.

>>1076642
because it doesn't actually fluctuate based on their profits. it fluctuates based on what people believe their profits will be.

>>1076527
one you our economist here said that a fair trade in the market would give you 4% of your initial investment at best. and that all profit above this number indicate predatory/destructive speculation at work. i believe him.

>>1076696
In short, gambling.

>>1076642
Loans are just institutionalized gambling and don't actually help the economy.

>>1076642

>Get a loan.
That's what stocks, in a sense. People who buy stocks are effectively loaning that company money in return for dividends or a higher stock price to resell for their personal profit, and besides this a great many companies pay part of their profits to shareholders. That's what a dividend is except dividends keep right on paying after you've reached the amount of money you originally paid for the stock.

>Then why does it bubble and crash, like, all the time?
It doesn't all the time. This is the first time it did it this badly in America for almost 70 years. It fluctuates all the time because the market is a weird fucking place and nobody can predict how it will work on a given day. That's both scary and good, because if everything was predictable there would be no way to make money at the stock market.

>>1076725
>>1076729
>That's what stocks, in a sense.
>in a sense.
Stocks = Company gets a "loan", promises to pay "market value" if you want it back. May simply not give your money back.
Loan = Company gets money at a fixed rate, will pay or people go to jail.

WAY different.

>It doesn't all the time.
http://en.wikipedia.org/wiki/List_of_stock_market_crashes
Eight times in the last ten years.

OP here. I'm dissapoint
Not even one decent argument so far.

>>1076806

Unless the company goes belly-up, you are guaranteed to get your money back. You might hate the timeframe in which the stock market does this and I don't blame you, what with your being younger than 25, but you will get your money back. The longer you wait to hold an investment, the more risk you can take on that investment.

If the company goes belly-up you did something really stupid and deserved to have your money taken, by the way.

>Eight times in the last 10 years

It's been well established that the last decade of stock trading has been fucked up by a great many idiots running things. That's leaving some 300 years where the stock market has increased wealth and commerce throughout the world, almost exponentially.

>>1076925
3AM announcements of loan default, asset transfer to another company, and bankruptcy against outstanding shareholders tends to convince you they're just a bunch of thieves.

Your sunshine can't stop the truth.

>>1076729
The way to make money, control billions so you can create your own market moves.

I did pretty well penny flipping too, but that's just being parasitic really.

>>1076806
>WAY different

well, yeah, when your understanding of it is completely wrong, they seem a lot different

Stocks = Company gets a "loan", "lender" gets percentage of profits and voting rights on company actions based on how much they pay in, they lose their money if the company goes bankrupt

Loans = Company gets a loan. They pay it back at a fixed rate. Lender doesn't get paid if they go bankrupt.

Either way, it doesn't get paid back if the person receiving the money goes bankrupt. Stocks have much better rewards for the lender for a lot more risk for the lender. Someone defaulting on their loan from the bank fucks everything up for everyone.

>>1076955

This is confusing the stock market for a moral force when it is an economic force. And for the record, I never said companies aren't thieves. But there are kind of a LOT of different companies, you know? On the stock market. One company doing seedy shit, hell, even 10 companies doing seedy shit is a drop in the bucket.

It's sad to see gas prices stagnant and even falling in places. This is one of the two annual spikes, but futures traders were distracted this year.

>>1076955
news don't like to tarnish the picture. we are living the dream.
niggers on crack are acceptable.

>>1076970

I'm okay with being a parasite in this case, honestly. More than enough money for me.

>>1077445

>>1079138
JEWS!!!!!!!!!!!!!!!!!!!!!!!!!!!

bump

>>1070792
it allows people to have economic freedom to invest and sell in what they would like in an individually educated manner which helps control economy.

>it allows people to have economic freedom to invest and sell in what they would like in an individually educated manner which helps control economy.

Braaaaainwaaash.....