I seem to recall some highly appointed officials (Hank Paulson, Ben Bernake) and an elected official, Barney Frank telling the public AKA 401k holders, that the crisis was well contained. Excuse me but these guys are at the top of the food chain on Wall Street. They are the ones making the big decisions. And they just flat out lied.
Instead of someplace to live, too many sheeple viewed their houses primarily as investments that could never go down and used them as piggy banks... now sheeple are in shock that bear markets still exist and their 401Ks are down. Since there was no greed or stupidity involved, they must all be victims.
But Pabst, "underperforming" is not losing money. People who are not in stocks are not "de facto short", because there is no necessity to own stocks. Stocks are not an expense, like one's place of residence. Besides, capital not in stocks must be invested into other things, even if it's only cash. Cash, bonds, real estate etc earn positive returns over the long-term in a growing economy. What matters is the internal return of the assets in question - how much does the book value increase (accurately measured) and dividend/coupon payout amount to, year on year. That is the "positive sum" element which you are overlooking, and which is not present for example in most of the commodities markets. For example, let's say company X has $100 mill in cash. It invests it and makes $10 mill in business operations. It is now worth $110m. If the stock was quoted at market cap of $100m at the start, and is now quoted at $110m, then it offers identical value to a new buyer, yet it has also returned 10% to the original owners of the stock. Thus the new buyer has not lost out - he can still buy $1 worth of stock for $1 worth of cash. And the original owners have made a 10% return on capital. Someone has gained, while no one else has lost out. That's positive sum. If you think about it, financial markets just represent a claim on the economic assets of a country. If a country experiences economic growth in the long-term, then the markets will earn a positive return.
Since a recent study found that half the sheeple don't even understand a simple weather forecast, I can see how they would confuse what was said with a guarantee that markets only go up... and why they would think gummit officials can predict the future.
Post a link to that recent study. I have never heard anyone say with a guarantee that markets only go up, and neither have you. Here is my link proving my points. I await yours about half the sheep don't understand a weather forecast. http://blogs.wsj.com/economics/2008/07/15/bernanke-about-that-housing-crisis-being-contained/
I also seem to recall, SEC Cox saying Bear Stearns was well capitalized. And how many high officials kept saying AIG was in great shape. http://www.washingtonpost.com/wp-dyn/content/article/2008/09/26/AR2008092603489.html The 401k holders made a big mistake buy trusting these high officials thatâs for sure. They were lied to all the way down. And to here Wall Street now say people must take responsibility for there investment is a crying shame.
Arbitration, they all hide behind arbitration. When you go to the doctors office you might have to sign something about informed consent but you don't have to give away a good portion of your legal rights in order to be seen. How many lawyers take on financial mismanagement cases on contingency? I have direct working experience with literally hundreds of MD's and DO's from all over the country, and while it is anecdotal it is a better sample than most surveys and I would characterize very few as lazy. Lazy people don't make it through medical school and residency. Sometimes what a patient may perceive as lazy is perhaps the after effect of a doc who has been on call over night or snowed under by several hours of paper work pre shift, there are so many reasons. You aren't in Canada are you by any chance? As far as financial industry types go, my experience is limited to those I meet at investor conferences and the 2-3 that call me each week trying to get my business. I wouldn't say that they are lazy but I would say that where as I would rate 80% of docs I have worked with as knowledgeable in their field I would put the % of financial professionals with similar competency at 10%. As far as ethics go the spread is perhaps not quite as wide but there is still a gulf between the two professions.
Here's the link to the weather forecast study. I don't see how your link "proves" any of your points... that "the top of the food chain on Wall Street flat out lied" or your implication that 401K holders should have taken that to mean the bottom had been reached in the stock market. http://www.nwcn.com/statenews/washi...09WAB-weather-forecast-study-SW.d5abae1b.html
No wonder you're confused... you don't even know the difference between "here" and "hear" or "there" and "their."
Tested 450 college students, I donât see how this can represent half the population. Now about that guarantee that markets can only go up. Itâs clear you love to spin.