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in part:
To traders, whether day traders or high frequency or somewhere in between, Wall Street has nothing to do with creating capital for businesses, its original goal.
Wall Street is a platform. It’s a platform to be exploited by every technological and intellectual means possible.
The best analogy for traders? They are hackers. Just as hackers search for and exploit operating system and application shortcomings, traders do the same thing. A hacker wants to jump in front of your shopping cart and grab your credit card and then sell it. A high frequency trader wants to jump in front of your trade and then sell that stock to you. A hacker will tell you that they are serving a purpose by identifying the weak links in your system. A trader will tell you they deserve the pennies they are making on the trade because they provide liquidity to the market.
The important issue is recognizing that Wall Street is no longer what it was designed to be. Wall Street was designed to be a market to which companies provide securities (stocks/bonds), from which they received capital that would help them start/grow/sell businesses. Investors made their money by recognizing value where others did not, or by simply committing to a company and growing with it as a shareholder, receiving dividends or appreciation in their holdings. What percentage of the market is driven by investors these days?
The important issue is recognizing that Wall Street is no longer what it was designed to be. Wall Street was designed to be a market to which companies provide securities (stocks/bonds), from which they received capital that would help them start/grow/sell businesses. Investors made their money by recognizing value where others did not, or by simply committing to a company and growing with it as a shareholder, receiving dividends or appreciation in their holdings. What percentage of the market is driven by investors these days?
It's an interesting perspective. Some of the comments are worth reading too. I don't totally agree with the guy pushing bonds, but one phrase he said kind of stood out to me: "investors hoping someone is behind them to buy them out at a higher price"
I think there are too many people making speculative bets in the market. Either trade on fundamentals or yields and enjoy the ride or go to fixed income.
If anything, things will get worse. I'm very disturbed by the media trend of using DJI performance as a referendum on political policy. I think it encourages government intervention that will only distort the market further.
IMO, stock prices are the Wizard of Oz, and HFT is the man behind the curtain. Too many people are freaking out about the volatility of the past couple weeks. Ask yourself: is any of it real?
It's an interesting perspective. Some of the comments are worth reading too. I don't totally agree with the guy pushing bonds, but one phrase he said kind of stood out to me: "investors hoping someone is behind them to buy them out at a higher price"
I think there are too many people making speculative bets in the market. Either trade on fundamentals or yields and enjoy the ride or go to fixed income.
If anything, things will get worse. I'm very disturbed by the media trend of using DJI performance as a referendum on political policy. I think it encourages government intervention that will only distort the market further.
IMO, stock prices are the Wizard of Oz, and HFT is the man behind the curtain. Too many people are freaking out about the volatility of the past couple weeks. Ask yourself: is any of it real?
Priced in gold the Dow didn't recover from the 1999 peak. What we are having is inflation in assets that is keeping the price steady as we lose value in the stocks. If we were to have a higher true inflation rate we could be having full employment.
Sure there is a ton of noise and the money attracted a whole lot of unwanted characters, but Wall Street is still the best source of capital for larger operations. And the funding that comes off the street is greasing a lot of the liquidity down the food chain. National banks were supposed to support the economy and keep it running, when they went Wall Street it became a mess.
I am not a big fan of regulation, but getting the big banks out of the investment cycle would be a very needed and welcomed change.
i would like any wall street supporter to tell me how THAT is beneficial to america. they are using american capital to bet against america's currency.
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