Moderators, since you cannot add "poll" to existing thread, I am starting a "duplicate poll thread" for "Are Stock Markets biggest ponzis?" Please vote for your opinion. The discussion is in the original thread http://elitetrader.com/vb/showthread.php?s=&threadid=149913
Ponzi? Why? Stocks are traded at whatever price people agrees. They foolishly inflated prices to overvalued levels, now the crash. Volatile markets? Yes Ponzi no way.
What about "daily trading on stock exchange" where a "big investor" will invest $100 million in a particular company and after 1 hour he will sell those shares because the price increased 5% or 10% in 1 hour because of his $100 million alone. Also what about short-selling? There is no real money in these 2 examples.
6 months back I had personally seen a "big investor" who invests "big money" in a particular company/stock almost everyday. After some 30 minutes he sells these shares which have increased 3% - 5% because of his "big investment" alone. There is 100% profit guarantee for this "big investor" and no loss. This is not real money.
This "big investor" is unknown to me and I had only seen the "trading activity". I have posted "estimated profit % earned" and not "profit % change". It may be less than 2%. Even 1% guaranteed profit from "single big investment" is not justified because the "big investor" is moving the stock markets alone.
Price Waterhouse Coopers(PWC) are the Auditors for "Satyam Computers". But PWC were not able to detect the sophisticated & well-engineered fraud from "Satyam Computers". Price Waterhouse Coopers are among the most reputed & biggest Financial Auditors in the world. Satyam computers is a classic example for "Ponzi at stock markets" because investors were made to believe of "inflated profits" which attracted new investors at Stock markets. There is high possibility there are thousands of "Satyam Computers" listed on worldwide stock markets.