zero sum game?????????????

DynamicReplic8r · Feb 25, 2006

Quote from whitster:

do you understand that economies GROW wealth

please compare the real wealth of the lowest income quintile NOW vs. 100 yrs ago.

(or any income quintile for that matter).

where does this wealth come from? does it come from other people (which it would have to if it was a zero sum game).

of course not.

this is so basic Econ 101, i can't believe anybody would argue the zero sum game.

our economy grows wealth by increased economy of scale, innovation, etc. for example, it takes far less man-hours/acreage/resources to grow a bushel of corn now, vs. 100 yrs ago. this frees up manpower for other tasks.

when i am trading YM on an intraday basis - THAT is a zero sum game. because for every winning trade, there is a losing trade. that is not true with the economy, or stock market, as a whole.
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Fair enough, but the stock market does not create wealth, the economy does.

ElectricSavant · Feb 25, 2006

I had to re-read that

when i am trading YM on an intraday basis - THAT is a zero sum game. because for every winning trade, there is a losing trade. that is not true with the economy, or stock market, as a whole.

madmunny · Feb 25, 2006

OMFG

thank you whitster....finally an intelligent answer

i had given up hoping for one

wish i had been able to answer my own question with as well as you did

Stalker · Feb 25, 2006

Quote from madmunny:

thanks....you all continue to prove to me that any one who believes it is a zero sum game is an idiot ......and i can continue to be pissed when ever i read your ignorant comments

lets forget about fees and commisions at the moment cause it just gives you morons something else to confuse yourselves with.

zero-sum implies for every dollar profited one dollar has been lost to make for a break even point......

tell me with google at $350 who has lost enough money to cover the profit that has been made from its gains....

even a stock that ipo's at $10 and goes up to 100 and back down to 50........more profit has been made than lost........
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If that was true I could sell you my dirty socks for 1 dollar, and you could sell em back for two. Then I sell it to you for three and so on and we would both make money. Wonderful, we can make tons of money this way right?

The thing is, when you sell a stock for a 1 dollar profit the next person who buys has to pay one dollar more then you did to get the stock. This means one dollar has been taken out of the market and one dollar has been given back. 1-1=0

ElectricSavant · Feb 25, 2006

less the commisson (negative sum)

This means one dollar has been taken out of the market and one dollar has been given back. 1-1=0

DynamicReplic8r · Feb 25, 2006

And I'll reiterate that there is an important distinction between the economy creating wealth and the stock market creating wealth. The economy creates the wealth, the stock market does not.

Stalker · Feb 25, 2006

That the value of the stock or the economy is going up has nothing to do with simple math of selling and buying.

DynamicReplic8r · Feb 25, 2006

Also, madmunny, Cramer destroys wealth.

ElectricSavant · Feb 25, 2006

so explain the effect that an auction has on price....

and don't tell me about the Kevin Bacon Movie (what happened to that guy...he was a good actor) Just like that rock N' Roll Group "The Cars...here today gone tomorrow...

Lights · Feb 25, 2006

can someone figure out how much net wealth was accumulated in the equities markets from 1900 and how much wealth was destroyed. very difficult i would imagine, but that would solve this mystery. my theory is the amount of wealth available to traders have risen over time, but winners and losers net out close to zero.