It's very difficult for most people to get rich in America. Federal income tax and all the rest, Bill O'Reilly (O'Reilly Factor) said his total tax rate is approximately 60%... seems only a bit high to me, but he does live in NY. So... after paying all the taxes and living expenses, there isn't all that much left over. Sure, the well-to-do have a nice house, better car, get to take a more expensive vacation... but they usually don't live waaayyyy below their means in order to save and accumulate assets. In the 80's I was a fee financial planner. When I first started, I thought making $100K per year would be nirvana. Well, I looked over the finances of many who made $100K, and most couldn't put $10K together if you held a gun to their head. So, I thought... "Nirvana must be $250K"... wasn't that, either... for the reasons explained above. I know quite a few "sort-of" rich people... mostly doctors. But most of them don't have all that much wealth, and those who do are age 50+ (they usually don't make more than a minimal salary until about age 30... and start out with big college and med school loans to repay).... and with this downturn in the markets and RE, many are nearing retirement and VERY concerned about the hit their retirement funds have taken. Unless you start a very successful business or get to make the kind of salary and bonus CEOs do (and that's a very small percentage of Americans), "getting rich in America" is a long and difficult process. I guess maybe that's the reason for the NObamanomics swing... "getting rich is too difficult, so screw it... I'll just go for the hand out and call it good". I don't expect any sympathy for the wealthy from the NObamabots... but the fact the Gummint intends to confiscate more wealth... after a lifetime of working and saving.... doesn't sit well with them.... can't imagine it would sit well with many of you all either, if you were in that position...
I'm not arguing that point at all. My point was simply the alternative. In the past, you could hide some of the wealth. Not anymore.
How do you know? Do you own a casino? My reckoning is that casinos aren't run as efficiently as you think. I don't appreciate the analogy because markets are beautiful, predictive entities, and casinos are just shiny, ugly places. The only part of the casino that really is a market is the sports book, and as a market they are HORRIBLY INEFFICIENT.
Murray, sad truth through all this is that when Lehman, Bear, Citi were all on their downward spiral, it was the massive buying in the CDS market that led to shorting in the stocks. Debt holders are lenders to the company and come first in terms of getting any scraps left over in a bankruptcy. When they saw what was happening in these instances they went out and bought protection; long CDS and short stock. This is the only way to hedge your exposure. CDS market-makers, that were short CDS, also had no other avenue than to short the stock, and did so in a massive fashion. Remember when articles came out where biggest shorters were the other brokers and banks? When SEC looked into it they realized these positions were hedges by market-makers and NOT spec on behalf of the banks, so inquiry was dropped. AIG never hedged their short CDS exposure, ever. They went off the portfolio theory that winners will outpace losers. The collateral they were asked to put up on short CDS is the single reason they went under. Going after short seller's other than the debt/CDS players is like shooting the tail, instead of shooting the rabid dog. Yet don't they have a right to hedge their 'loan'. LEH stock going down did not create a self-fulfilling prophecy, as we have read. Their inability to stay liquid was. Don't think that SEC, Cramer, Gov't will ever come to realize this fact and I have never seen it in print, I just lived through it and saw it first hand.
Uh, except for the massive amounts of naked short selling at Bear, Lehmen and other places. Can you account for those phantom shares? No one else can. I'm all for the free market, though, and it's not a matter of "more regulations." It's simply that the SEC didn't enforce the most basic of existing laws re: shorting.
Is that so? Then why are you wasting your time with stocks, you should be living the life, picking off bookmakers. Case closed poser.
Barney Frank says uptick rule coming 'soon.' http://www.marketwatch.com/news/sto...x?guid={54251552-13B2-4F70-AA8B-DA31C4F66E1F} -Guru
Landis is right. They're trying to "stabilize" the markets & to be fair I have no problem w/ the uptick rule. Those wishing to short should do what I do - trade futures. There's even Single Stock Futures. To be fair, "naked" shorting is against the rules but it's still pervasive. Maybe reinstating the uptick rule will make the fight a little more balanced. "Machine gunning the bids" would be eliminated.