Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
You're assuming that Wall Street works today as it was meant to be, and did in the 1960s and 70s. Take a look at this blog and share your take on it, where you agree/disagree with this billionaire investor:
I have heard that argument before, and I disagree with it. I see no problems with HFT or the techniques used by them. That analogy is very misleading. A hacker is exploiting a weakness caused by stealing a person's property. They are making false claim to something unearned. A trader does not make claim to something that is proprietary knowledge. A trader exploits natural fluctuations in the market. A trader does not steal anything. A trader does more work the the average person to hear the deals first. Suppose Wal-Mart has a new deal where the first 10 customers at the door tomorrow get a 50" flat screen TV for $5. Traders are those who keep their ears to the ground and see the signs that such a deal is coming. Do we punish them because they were smarter than us, or do we applaud them and try to learn from them for understanding the system better than we do? I pick the latter. The gaps utilized by HFT were there as a natural part of the market, and those in Wall Street exploit those fluctuations to create more money and more investment capital for the system. They drive the net value up, which can then be used to benefit society at a macro level. They money they earn IS used to fund business.
I think the heart of the problem is this quote from the article:
"Because the game of chess is far too complicated for 99pct of the institutions out there investing money"
We want to water down the potential growth of the market because most people are too lazy and too uneducated to learn how it works. That seems like a bad solution if I ever heard one. We should not regulate the highly intelligent merely because the masses do not have the work ethic to keep up.
So you are saying that the rise in investment value that the middle class lived fat off of since 1970 was 'nothing'?
Wall Street brought the economy up far beyond what it ever could be, and you and I cheered them on while they could make us money. Shame on us for turning our backs as soon as things go a little south.
If you are referring to stock prices, and crediting Wall St. for those rises, you are misguided.
The rises in stock prices are due to the returns on the stocks and Wall St. had nothing to do with it. The success of the companies were due to the workers, engineers and management, that created value, not those that traded their stocks.
I have heard that argument before, and I disagree with it. I see no problems with HFT or the techniques used by them.
And you're not alone. If you were, they wouldn't be doing what they do, regardless of the costs to the nation and its people.
Quote:
That analogy is very misleading. A hacker is exploiting a weakness caused by stealing a person's property. They are making false claim to something unearned. A trader does not make claim to something that is proprietary knowledge...
I don't agree with that either. And when you look at analogies, try to look at the concept involved not the act itself.
If you are referring to stock prices, and crediting Wall St. for those rises, you are misguided.
The rises in stock prices are due to the returns on the stocks and Wall St. had nothing to do with it. The success of the companies were due to the workers, engineers and management, that created value, not those that traded their stocks.
Are you seriously suggesting that wall street had nothing to do with rise in stock prices?
Where do you think the engineers, workers and management got the money to fund their day to day working lives for the last 40 years?
Quote:
Originally Posted by EinsteinsGhost
And you're not alone. If you were, they wouldn't be doing what they do, regardless of the costs to the nation and its people.
We absolutely need to look at the cost to the nation. If you project the economic gains given to this country through trading over the last 40 years and subtract out the recent fiscal crisis, we are still very much positive. So there are no net costs to the nation, when calculating for opportunity cost of capital and time.
Quote:
I don't agree with that either. And when you look at analogies, try to look at the concept involved not the act itself.
I absolutely agree with this. Can you respond to the rest of my post, where I addressed this?
We absolutely need to look at the cost to the nation. If you project the economic gains given to this country through trading over the last 40 years and subtract out the recent fiscal crisis, we are still very much positive. So there are no net costs to the nation, when calculating for opportunity cost of capital and time.
Need can often conflict with wants. The latter often wins, and that is where we're right now.
Quote:
Originally Posted by hnsq
I think the heart of the problem is this quote from the article:
"Because the game of chess is far too complicated for 99pct of the institutions out there investing money"
We want to water down the potential growth of the market because most people are too lazy and too uneducated to learn how it works. That seems like a bad solution if I ever heard one. We should not regulate the highly intelligent merely because the masses do not have the work ethic to keep up.
Your "problem" is due to a lack of understanding of the point being made. See a paragraph above this quote, and an illustration following it.
I understand the point completely. I simply disagree with it, and I think it is a point that promotes laziness and apathy among most people.
And you still haven't addressed my point.
Your point was addressed in the blog itself. You say you disagree with it, but don't dare explain where you disagree. Are you suggesting that people aren't increasingly dependent on the middle men like Goldman Sachs, that it doesn't take much to have all the clues necessary to understand instruments like derivatives?
Your point was addressed in the blog itself. You say you disagree with it, but don't dare explain where you disagree. Are you suggesting that people aren't increasingly dependent on the middle men like Goldman Sachs, that it doesn't take much to have all the clues necessary to understand instruments like derivatives?
I AM saying it doesn't take much to understand instruments like derivatives. I have a few books at home that I read in my free time to educate myself. I can give you the titles if you like. I also started investing with $500 when I was 19. How many people do you think have even TRIED to educate themselves?
People are only dependent on the middle man because they never bother to educate themselves.
I AM saying it doesn't take much to understand instruments like derivatives. I have a few books at home that I read in my free time to educate myself. I can give you the titles if you like. I also started investing with $500 when I was 19. How many people do you think have even TRIED to educate themselves?
People are only dependent on the middle man because they never bother to educate themselves.
Then I suggest you help Mark Cuban learn what he calls increasingly complex financial instruments on his blog site. I will look for your expertise there.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
