Any commies around?

Post Reply New Topic

On a basic level yes, the old style bank does that. When you get into the straw house of stocks and shares, its a very different matter. Its the straw house where most of the money is being made and lost.

"As through this life you travel, you meet some funny men
Some rob you with a six-gun, some with a fountain pen."

Pretty Boy Floyd by Woodie Guthrie

Well, the same basic idea of determining who should get what capital is a part of the stock market, just less directly. As for the money made in the stock market, a basic idea is that the money shifts occur based upon expected dividends, as that is the only real value to a stock. Issues of money being lost seems to be a matter of misevaluation than anything else.

In any case, that issue seems to more be one of stock markets than banking itself, as stock markets do not have a necessary relation to banks, and there are systems that are considered more banking based and other considered more market based, as the US is considered market-based, but Germany and Japan are considered bank-based systems.

Well, he seems like a decent chap, apart from the fact he's a lawyer. But, you see, that's the problem with lawyers, they always seem decent on the surface, but rarely are.

So what did those private school chaps do to upset you, Kangoogle?

Its when they make things way too complicated for all involved is when things go wrong. Lets face it economics is complex enough, without the banking sector sticking their stirring stick in.

In the UK the whole thing is all mixed together which is kind of whom I referring to over here. At least in the US there have been prosecutions, over here nothing has happened, apart from someone house getting a spot of redecorating.

Brown on the other hand is an academic, he at least began honest. Asides, if you look at his past, he is almost definitely one of us. Its a shame he has to spend most of his time playing games with NT socialites. Thats the aspect of politics that needs reforming, really we need a lot more Brown's (and possibly a few Opik's) to sort out the system.

Soured my university experience to an extent. But what annoys me is how they get to steal all the good social positions, many of them doing so with no merit whatsoever.

Well, the issue is how complex is too complex. I mean, was it bad if they confused people with the terms for mortgages? Sure, but is that most of what happened? Well, that is unknown, some think that speculation was a bigger factor in the US housing market crunch(which is very much involved with the international crisis, although other issues are at play as well, such as Iceland's monetary policy) as the adjustable rate mortgage group responded more to the crisis than the fixed-rate mortgages, without regard to whether it was sub-prime or prime, as shown in some research by economist Stan Liebowitz.
http://www.independent.org/publications ... full&id=30 This suggests speculation was occurring, and the cause of excess speculation is a difficult thing to determine as some blame the central bank(Austrian business cycle), some blame investor psychology(Minsky's Financial Instability Hypothesis), and I think Dr. Liebowitz argues that US economic policy was to blame for the speculation involved in this matter.

As for "too complex", well, the issue is that a financial system will be by nature complex, as the entire system is based upon trying to maximize income by selecting the most productive stocks, but also to control risk by looking at the risk of each investment, the covariance of each investment, and a number of stock options, all of which are beneficial but many are complicated. This is a tricky thing because the variables all fluctuate, and the various options can add more complexity to the matter while still being useful to the overall system in terms of handling information. So, really, by doing complicated work(remember, there are people with PhDs in Finance) they do some benefit, but the issue is that finance, by dealing with so many variables is by nature complicated. Even if one just focused on the accounting side, by going for value investing, there is still the issue of looking at the accounting work, making sure that it isn't too good to be true, and making sure the industry the company is in is likely to continue growth.

The UK is considered more market based, I think, but it is much more balanced than the US is if I remember correctly, and I think the US is one of the few nations that separates banking from markets by law. In any case, some of the issues with the US are that illegal actions are coming to light, such as with Madoff's Ponzi Scheme, as the scheme was illegal, but it came to light due to the bad economic conditions.