It's all FUD, Fear, Uncertainty, Doubt. These guys on the far left defeated the efforts to privatise Social Security by talking up the risk involved. They never mentioned the risk of getting stuck on a fixed income in an inflationary time like happened in the US in the 70's. Comedians were joking about old people eating dog food and it was no joke. Some were unable to make the tax payments on houses they had paid for over a lifetime of work in California. The bullshit far leftist governor Brown did not lift a finger to help them, he was too concerned about consenting adults and privacy to be bothered with a bunch of old folks. Hey SA, you can keep the tender mercies of communism.
This is so stupid, Buffet has a few billion in derivatives himself the hypocrite. Read his annual report for the options, forex, swaps and futures his company has for, yes hedging, but also speculation. Buffet is not a stock picker, he runs a private equity fund in which he buys companies whole and that is the true way to get rich, own businesses. Coke and Bud are just stocks he puts his profits into and holds forever.
Yep. I like to call him the Bozo from Nebraska. Most of his returns are due to compounding, not stock picking. Geesh, the guy missed the greatest bull market ever because he didn't "understand technology".
That's why a FREE people can't exist without FREE markets. These markets establish VALUE. University hacks and other bureaucrats don't know a thing about VALUE. (not much about markets either ) Anytime, lots of ignorant souls are easily convinced by devellishly clever demagogues that this ought NOT to be like this and that more JUST ways are needed to govern a happy people. If you can't make up your mind for yourself, look at what happened to those zillions of fools that outlawed those "unjust stupid markets" during the past century. Unfortunately, most poor souls have perished and the ones remaining only have very short memories. nononsense PS: Beware of them devellishly clever demagogues!
. Optioncoach: This is so stupid, Buffet has a few billion in derivatives himself the hypocrite. Read his annual report for the options, forex, swaps and futures his company has for, yes hedging, but also speculation. ****** December 31, 2005 SouthAmerica: As of the end of 2004 Warren Buffet had a US$ 22 billion dollars bet against the US dollar, and for the entire year of 2005 he lost US$ 1 billion dollars on his bet. I understand that he still has his large bet against the US dollar, and I agree 100 percent with his bet. He will get his money back and he also will make a profit on his bet in 2006. The Fed will keep increasing the Fed Funds rate at least up to 5 percent in 2006, at that point we need to see the total picture and re-evaluate the current global economic situation. In 2005 because of that special tax break on the repatriation of offshore profits the US American companies repatriated over US$ 300 billion dollars to the US. Part of this repatriation came from the European countries with the result of pushing the US dollar up and the Euro down. That tax break expires in October of 2006, I donât know how much money (profits) American companies still have stashed away in Europe, and around the world at this point and how much they are going to repatriate to the US during 2006 to take advantage of the tax break. The amount of repatriation will affect the value of the US dollar. By May 2006 the Fed Funds rate should be at 5 percent â from there and in the following months the Fed Funds rate will fluctuate depending on what is happening to the US dollar. The value of the US dollar will become a very important benchmark in the decision regarding the Fed Funds rate. In 2006, various countries are going to sell their oil in euros instead of US dollars. ******* Arnie: Yep. I like to call him the Bozo from Nebraska. ******* SouthAmerica: If you think that Warren Buffet is a Bozo then I hope your job has not to do with investments and with Wall Street â otherwise you are in trouble my friend. .
Nononsense wrote: That's why a FREE people can't exist without FREE markets. These markets establish VALUE. University hacks and other bureaucrats don't know a thing about VALUE. (not much about markets either ) Anytime, lots of ignorant souls are easily convinced by devellishly clever demagogues that this ought NOT to be like this and that more JUST ways are needed to govern a happy people. If you can't make up your mind for yourself, look at what happened to those zillions of fools that outlawed those "unjust stupid markets" during the past century. Unfortunately, most poor souls have perished and the ones remaining only have very short memories. nononsense PS: Beware of them devellishly clever demagogues! ..................................................................................................... Excellent Commentary Lets remember what ¨stock ¨really is.... A stock is a nonobligatory no interest loan...whereas debt is an obligatory legal loan whereas interest is obliged.... Naturally any additional cost of production including interest ....makes the product more expensive.... Now let´s look at the establishment of society economics and free markets... If indeed a free market exists....then the market is natural and will offer social balance in a natural manner....There would be no laws...and the strongest in every sense by economics and force would rule...however when one starts imposing laws...the markets are no longer free...Thus there are no free markets.... What one can say is that there are some country encapsuled legal systems which contain constrained and somewhat free markets... ............................................................................................. Let´s say one country sets the stage for an electronic stock market whereby the public can buy for 1/10 cents per share...and can buy one share.....there is one clearing arrangement whereby funds can be deposited at any bank for stocks...The companies allowed to list meet the preliminary listing requirements....and required reporting information is internet based for all to view at the same time.... Now let´s set the opposite example whereby another country whereas the population´s attributes are homogeneous to the competing counterparty country....can only offer interest obligations by banks which has no stock market..... Now let the race begin as to which country wins the economic race...In a natural sense..the winner will be the country whose prices are just under the prices of the ïnterest difference¨.... Thus the value of the winning country businesses are also higher also because the net cash flow is higher ....free of the interest cost.... .................................................................................... The above does not exist of course but is a directional argument...and is a correct argument....Stocks last as long as their products are publicly demanded... ...................................................................................... AX and the NYSE...NASDAQ...all the world´s exchanges Firstly globalization is good for the world´s best companies....is incredibly horrid for displaced poor people...is incredibly good for nondisplaced people... Example...let´s say the average person in country A is having to pay $26,000 for a car.....however in the next twelve months another country B is allowed to sell this country the same car for $8000 ....Are the countries equal...of course not...The workers in country A are displaced....and the workers in country B are asked to make more cars....Thus if one is not displaced in country A...one has a windfall of $18,000.... In 2007...this is a reality for both the US and China.... Thus ....it is the value of the Chinese ¨stock¨that will increase many times over and be the example of why a person would take a shot at the stock market...and of course there is GM and Ford....and American parents that used to work at GM and Ford telling their children to prepare themselves never to be put in this situation again.... The AX NYSE stock market model will centralize the world´s exchanges and thus enable the world´s population cheap and instant access to any companies stock...thus ownership is incredibly accessible at any given second worldwide for as little as one share...thus enabling the highest possible equity values... and this is happening fast...even though the AX NYSE is not one year old...there are already plans to merge all US exchanges...and the London exchange... Thus it may be that the only equivocator in globalization is the ownership of stock... Example...all GM workers own shares of the Chinese auto maker...and when they are displaced...own the shares of the Chinese company that have increased from $1 to $1000 per share... .......................................................................................... The stock market has the capability of setting the highest values for work...as well as the highest value volatility.... And as long as the world´s population can login to any computer on the internet and buy as little as one share efficiently...well you got it...this play has a ways to go.... and this play is happening now...l... ................................................................................................ True stock indices valuations Thus the question becomes....what value is greater... The collective value of economy A...or the collective value of economy B... The answer is that nobody knows....The US stock indices are used to indicate the changing value of the stock market...thus creating the idea that stock investment is a good thing over time...This is highly fraudulent in that the companies values that are no longer maintained in the indexes are not taken into account....Furthermore the total money put into all stocks is not known...thus there is no true measure of whether or not the stock market retains more total value than an all debt market... It can be assumed that innovation can take place more easily in a stock market versus a debt market..... What one can say is that it is more possible to attain higher rewards for work in a stock market than one can attain in a debt market....
This piece from late summer/early fall unnerved me instinctively even though I don't know enough to know why. Then, you might recall, there were stories about a FED/big bank meeting - in NYC I think - on this issue or something like it. Potential flaws in derivative markets: FT.com / Home UK - On Wall Street: Derivatives cannot take the pressure: By John Dizard: The recent difficulties settling futures contracts in Chicago have highlighted a growing problem: there are big derivatives markets out there that aren't built to take the strain being put on them.... In June, some large holders of the June 10-year Treasury futures contract, including Pimco, demanded settlement -- taking delivery of actual bonds -- instead of, as usual, rolling their positions into the next contract. The scramble to find the necessary notes was made worse by the fact that one account, possibly the hedge fund Citadel, already held the bulk of the cheapest notes to deliver. Whether or not Citadel, or Pimco's bond dealers, intended to make some extra money by squeezing out other bidders, it couldn't have happened if the structure of the futures contract had kept up with the times. The Chicago Board of Trade's 10-year T-note futures contract is one of the older financial derivatives around today. That's good, in that it has been tested through a range of crises and cycles, and it's bad because it was designed based on the classic requirements of grain dealers, rather than the current requirements of interest rate markets.... The 10-year futures contract is based on a theoretical Treasury note that doesn't exist... the CBOT have formulas to convert the value of existing Treasuries into the theoretical ones. For example, the cheapest bond to deliver to settle the current September contract is the August 2012 bond. So you are really getting delivery of, and contracts are priced from, the seven-year stuff rather than 10-year stuff.... There is now about eight times the number of outstanding futures contracts as bonds eligible and available to fulfil them. The obvious solution is to go to cash settlement. That would mean the exchange changing the terms of the 10-year contract, so that actual bonds would not be delivered. Instead, those now obliged to deliver would make cash payments equal to the value of a reference price. That is how Fed funds futures contracts are settled.... The real problem is that the US economy is just too leveraged. Starting with the housing industry, the country is too dependent on derivatives markets to create the illusion that interest rate risk can be conjured away. The technical problems of the 10-year are just another early warning sign of this fundamental weakness. Geo.