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| View Poll Results: Who WILL play | |||
| Michigan |
   
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20 | 16.67% |
| Rutgers |
  
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14 | 11.67% |
| Texas |
  
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86 | 71.67% |
| Voters: 120. You may not vote on this poll | |||
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#151
11-03-2007, 12:04 PM
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Re: How is the stock market NOT zero-sum?
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[ QUOTE ] Okay, since I appear to be among a group of seasoned economists, where exactly did the "new" wealth come from? Did a group of magical Leprechauns give it to us? [/ QUOTE ] no but technological advances do. [/ QUOTE ]What does a secondary market for financial instruments have to do with technological advances? Indeed, the IPO process does foster technological advance, and stocks puchased through IPOs are given value based on their ability to be traded in secondary markets--hence the value of the stock market to society. But after this process takes place and we enter the realm of the traditional "stock market", the only impact of the stock value on a company's ability to advance techonologically, makes profits, or really do anything is psychological, and certainly extrenal to the stock market itself. |
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#152
11-03-2007, 01:14 PM
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Re: How is the stock market NOT zero-sum?
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Okay, since I appear to be among a group of seasoned economists, where exactly did the "new" wealth come from? Did a group of magical Leprechauns give it to us? [/ QUOTE ] This is how Adam Smith saw it, a more seasoned Economist than I: Adam Smith saw wealth creation as the combination of materials, labour, land, and technology in such a way as to capture a profit (excess above the cost of production) I also found this in Wikipedia which supports my claim that the sides of this argument could probably be divided down political lines: Not a zero-sum game Regardless of whether one defines wealth as the sum total of all currency, the M1 money supply, or a broader measure which includes money, securities, and property, the supply of wealth, while limited, is not fixed. Thus, there is room for people to gain wealth without taking from others, and wealth is not a zero-sum game in the long term. Many things can affect the creation and destruction of wealth including size of the work force, production efficiency, available resource endowments, inventions, innovations, and availability of capital. However, at any given point in time, there is a limited amount of wealth which exists. That is to say, it is fixed in the short term. People who study short term issues see wealth as a zero sum game and concentrate on the distribution of wealth, whereas people who study long term issues see wealth as a non-zero sum game and concentrate on wealth creation. Other people put equal emphasis on both the creation and the distribution of wealth. It has been theorized, for example, by Robert Wright, among others, that society becomes increasingly non-zero-sum as it becomes more complex, specialized, and interdependent. One's attitude towards this issue affects the design of the social or economic system that one prefers. |
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#153
11-03-2007, 01:52 PM
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Re: How is the stock market NOT zero-sum?
Here's a little more evidence supporting your claim: [ QUOTE ]
the overall economy is not zero sum [/ QUOTE ] That one was said by me, earlier in this thread. The stock market is fundamentally different from the economy, however, because the secondary trading and ownership of stocks DOES NOT create wealth. |
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#154
11-03-2007, 02:35 PM
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Re: How is the stock market NOT zero-sum?
[ QUOTE ]
Here's a little more evidence supporting your claim: [ QUOTE ] the overall economy is not zero sum [/ QUOTE ] That one was said by me, earlier in this thread. The stock market is fundamentally different from the economy, however, because the secondary trading and ownership of stocks DOES NOT create wealth. [/ QUOTE ] If a company adds value and creates profits that added wealth is reflected in the price of the stock. |
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#156
11-03-2007, 03:43 PM
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Re: How is the stock market NOT zero-sum?
[ QUOTE ]
[ QUOTE ] Here's a little more evidence supporting your claim: [ QUOTE ] the overall economy is not zero sum [/ QUOTE ] That one was said by me, earlier in this thread. The stock market is fundamentally different from the economy, however, because the secondary trading and ownership of stocks DOES NOT create wealth. [/ QUOTE ] If a company adds value and creates profits that added wealth is reflected in the price of the stock. [/ QUOTE ]So you agree, then? |
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#157
11-03-2007, 04:01 PM
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Re: How is the stock market NOT zero-sum?
[ QUOTE ]
[ QUOTE ] [ QUOTE ] Here's a little more evidence supporting your claim: [ QUOTE ] the overall economy is not zero sum [/ QUOTE ] That one was said by me, earlier in this thread. The stock market is fundamentally different from the economy, however, because the secondary trading and ownership of stocks DOES NOT create wealth. [/ QUOTE ] If a company adds value and creates profits that added wealth is reflected in the price of the stock. [/ QUOTE ]So you agree, then? [/ QUOTE ] if by agree you mean disagree then yes. he is saying that the economic improvements are transferred via stock price increases over time and dividend payments. everybody wins. simply put, stock market is not zero sum. this is trivial and i'm really amazed that this has gone on as long as it has. Barron edit: agreed - ahnuld |
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