Stocks: 5-year lows

POSTED BY: SignyM
UPDATED: Friday, April 4, 2025 12:49
VIEWED: 2193
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SIGNYM

Thursday, October 9, 2008 8:07 PM

When historians look back on this time, they'll be asking themselves how we got into this mess again. Why didn't we see the big income gap? Why did the government go into such debt? Why did the government shovel money at the rich? Why did we allow the Glass-Steagall Act - passed in the LAST depression - to be repealed? Why did the SEC allow the lowest capitalization rate ever, and then let investment banks monitor themselves? Why did the Fed encourage excessive consumer and government debt with low, low, low interest rates? Why did the government encourage subprime mortgages by providing a ready market, and why did the Federal government prevent prosecution of predatory lending?

There's a lot of blame to go around. Like any massive failure, it's the result of -not one - but MANY errors.

Which, I think can all be boiled down to a combination of "trickle-down" economic policies, "Break the government" fiscal policies, and Keynsian economic policies: If you steal from the poor to give to the rich (trickle-down) you can break the government. But if you want to keep the economy going then you provide cheap cheap credit to the poor (Keynes) so they can continue to shop shop shop.

It all had to come crashing down sooner or later!
---------------------------------
Let's party like its 1929.

JAYNEZTOWN

Friday, October 10, 2008 2:36 PM

its bad

Quote:
FTSE plunges 440pts in just 10 minutes as markets around the world
Daily Mail, UK - 6 hours ago
Japan's Nikkei closed down a massive 9.62 per cent after shedding 881 points in its worst session since Black Monday in 1987

sounds like a crash is coming

HERO

Friday, October 10, 2008 3:11 PM

Quote:
Originally posted by JaynezTown:
sounds like a crash is coming

Quiet...your scaring the women.

H

SIGNYM

Friday, October 10, 2008 3:23 PM

Well, I'm a woman and I'm not scared. Fortunately, the only two things in my portfolio that are tanking right now (stocks, agricultural commodities) make up less than 10% of my assets. So personally, I don't care.

---------------------------------
Let's party like its 1929.

PHOENIXSHIP

Friday, October 10, 2008 3:46 PM

I know it (the coming crash) is going to sting (to say the least), but is there really anything we can do about it? Is this not the medicine we must take in order to return to reality? Every single dollar in the treasury is only a trickle in the face of the enormous shortfall created by our financial dreamworld of the last 10 years.

Also - I am sick of hearing on TV how "everyone" needed this wake up call. Plenty of us were paying attention - buying an affordable home, keeping a job that maybe wasn't that great so we could pay our bills on time, not running up huge credit card debt, etc.

"Why're you arguin' what's already been decided?"
Mal to Jayne, "Jaynestown"

WULFENSTAR

Friday, October 10, 2008 3:49 PM

Sigy...

NO WAY!

You're a chick? Damn, now my southern sensibilities are all out of whack.

I shoulda been politer.

SIGNYM

Friday, October 10, 2008 3:58 PM

Er.... no Wulf, that's OK. I named myself after Signy Mallory, a character is Downbelow Station. While I'm not anywhere near as hard-bitten as Signy, I aspire to be a rigorous realist.

---------------------------------
Let's party like its 1929.

JAYNEZTOWN

Saturday, October 28, 2023 7:14 AM

Dow drops more than 350 points to end brutal week, S&P 500 closes in correction territory

https://www.cnbc.com/amp/2023/10/26/stock-market-today-live-updates.ht
ml

ANONYMOUSE

Saturday, October 28, 2023 11:28 AM

Several years ago I read a book which covered Brian Arthur and his controversial theory of increasing returns (a quick Google search suggests it's more mainstream now). There are a number of mistakes being made - not just in the US, but everywhere.

There is a complete misunderstanding of the economy - there seems to be an assumption that it's a linear entity. No. It's far too complex for that. Disordered at best, chaotic at worst.

If classic economic theory was correct, places like Wall Street, the New York Stock Exchange and the London Stock Exchange would be ordered, quiet places - not the barely-contained riot we know them to be.

According to CET, monopolies don't exist; no one company can gain enough of a market share to hold one. Ahem. Xerox. Micro$oft. Sony. Need I go on? :)

If CET was correct, the economy would be predictable. I defy even the world's most advanced AI to pull that one off for more than 0.3 seconds into the future.

All agents, buying and selling, would have complete and accurate info. Buying and selling in all but the simplest markets is a guessing game. Worse, there are rumours, counter-rumours, mistakes, outright lies, and the info is never complete. Come back, SEC and the Monopolies Merger Commission, all is forgiven! :)

So why are they sticking to CET?

Answer: no-one yet has come up with a better answer. Brian Arthur once told his mentor that he was going to bring economics into the 20th Century. The mentor asked sadly, "Don't you think we should bring it into the 19th Century first?"

I am no savant. I don't know what the answers are. But one thing I figured out as far back as 1986: what is each country's National Debt about? To whom do they owe this debt? If every nation in the world got together and somehow added everything up, wouldn't they find that the debts would cancel each other out?

If I owe a guy £10 but he owes me £15, then effectively he need only pay £5. Why (other than the sheer magnitude of the problem, which I grant you is awesome if not terrifying) can't nations do something similar and find out who really has all the world's money?

Although given the way things go, it's probably Israel or Malta or something daft like that. :)

“The personal, as everyone’s so fucking fond of saying, is political. So if some idiot politician, some power player, tries to execute policies that harm you or those you care about, TAKE IT PERSONALLY. Get angry. The Machinery of Justice will not serve you here - it is slow and cold, and it is theirs, hardware and soft-. Only the little people suffer at the hands of Justice; the creatures of power slide out from under with a wink and a grin. If you want justice, you will have to claw it from them. Make it PERSONAL. Do as much damage as you can. GET YOUR MESSAGE ACROSS. That way you stand a far better chance of being taken seriously next time. Of being considered dangerous. And make no mistake about this: being taken seriously, being considered dangerous marks the difference, the ONLY difference in their eyes, between players and little people. Players they will make deals with. Little people they liquidate. And time and again they cream your liquidation, your displacement, your torture and brutal execution with the ultimate insult that it’s just business, it’s politics, it’s the way of the world, it’s a tough life and that IT’S NOTHING PERSONAL. Well, fuck them. Make it personal.’

- Quellcrist Falconer
Things I Should Have Learnt by Now, Volume II

Richard Morgan, "Altered Carbon"

SIGNYM

Saturday, October 28, 2023 4:42 PM

Quote:
Originally posted by Anonymouse:
Several years ago I read a book which covered Brian Arthur and his controversial theory of increasing returns (a quick Google search suggests it's more mainstream now). There are a number of mistakes being made - not just in the US, but everywhere.

There is a complete misunderstanding of the economy - there seems to be an assumption that it's a linear entity. No. It's far too complex for that. Disordered at best, chaotic at worst.

If classic economic theory was correct, places like Wall Street, the New York Stock Exchange and the London Stock Exchange would be ordered, quiet places - not the barely-contained riot we know them to be.

According to CET, monopolies don't exist; no one company can gain enough of a market share to hold one. Ahem. Xerox. Micro$oft. Sony. Need I go on? :)

If CET was correct, the economy would be predictable. I defy even the world's most advanced AI to pull that one off for more than 0.3 seconds into the future.

All agents, buying and selling, would have complete and accurate info. Buying and selling in all but the simplest markets is a guessing game. Worse, there are rumours, counter-rumours, mistakes, outright lies, and the info is never complete. Come back, SEC and the Monopolies Merger Commission, all is forgiven! :)

So why are they sticking to CET?

Answer: no-one yet has come up with a better answer. Brian Arthur once told his mentor that he was going to bring economics into the 20th Century. The mentor asked sadly, "Don't you think we should bring it into the 19th Century first?"

I am no savant. I don't know what the answers are. But one thing I figured out as far back as 1986: what is each country's National Debt about? To whom do they owe this debt? If every nation in the world got together and somehow added everything up, wouldn't they find that the debts would cancel each other out?

Er... no. Some nations are international debtors, some are international creditors. The USA is an international debtor.

Quote:
“The personal, as everyone’s so fucking fond of saying, is political. So if some idiot politician, some power player, tries to execute policies that harm you or those you care about, TAKE IT PERSONALLY. Get angry. The Machinery of Justice will not serve you here - it is slow and cold, and it is theirs, hardware and soft-. Only the little people suffer at the hands of Justice; the creatures of power slide out from under with a wink and a grin. If you want justice, you will have to claw it from them. Make it PERSONAL. Do as much damage as you can. GET YOUR MESSAGE ACROSS. That way you stand a far better chance of being taken seriously next time. Of being considered dangerous. And make no mistake about this: being taken seriously, being considered dangerous marks the difference, the ONLY difference in their eyes, between players and little people. Players they will make deals with. Little people they liquidate. And time and again they cream your liquidation, your displacement, your torture and brutal execution with the ultimate insult that it’s just business, it’s politics, it’s the way of the world, it’s a tough life and that IT’S NOTHING PERSONAL. Well, fuck them. Make it personal.’

- Quellcrist Falconer
Things I Should Have Learnt by Now, Volume II

Richard Morgan, "Altered Carbon"

Interesting quote.

-----------
"It may be dangerous to be America's enemy, but to be America's friend is fatal." - Henry Kissinger

Loving America is like loving an addicted spouse - SIGNYM

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