Fringe on 15/9/2008 at 04:27
At what point would it be socially acceptable to blow my brains out?
Hoping this obvious set-up for the traditional RBJ response will get him itt
TBE on 15/9/2008 at 04:36
First we shoot the brokers, then the lawyers, and THEN the Minnesotans.
Printer's Devil on 15/9/2008 at 04:43
Incredible economic disasters averted by Republicans during a hotly contested election campaign? Say it ain't so, America.
ToolHead on 15/9/2008 at 07:03
DFW dead?...
Nonononononononononononononono...
Fuck no.
...
No.
demagogue on 15/9/2008 at 17:52
Quote Posted by ToolHead
DFW dead?...
Wha...! Oh, I see.
Be careful when you refer a person by the name of a region.
People might get the impression that their hometown was nuked!
Hell of a disastrous weekend, though, wasn't it?
Kolya on 15/9/2008 at 18:00
Quote Posted by Scots Taffer
An article I read recently had the following excellent quote:
We believe in capitalism when there are obscene profits, but we prefer socialism when it comes to losses.How can there be obscene profits without equal losses when stock markets never produce anything themselves and just push money around?
That money is just paper if it ain't connected to some value in the real world. So where does the real value come from and where does it go when things like this happen? Someone must have made huge profits from this, eg the Bank of America who bought that security company under it's actual value?
Stock markets seem to generate money out of thin air and lose it again in a similar fashion. Looks to me like a zero-sum game. What's the deal?
demagogue on 15/9/2008 at 19:45
Yeah, it can be like that on the surface, but there's more going on too.
The stock market is just fleshing out what's already going on in real world markets. There's your value at the end of the day. It was squandered a year ago with the loads of bad subprime loans that went out. It was only a matter of time before they all started defaulting, and the spike in oil price just compounded the problem.
What you get with the stock market, in these kinds of situations where there isn't a growing business but just risk and payoff (commodities, insurance, loans...), the supply-demand finally sets the value. All the buyers and sellers are doing is betting on the risk of supply, buyers that it later goes down, sellers that it later goes up. Then the supply works itself out in the real world, and the market just fleshes it out.
In the case of oil, it was China's unforseeably insane increase in demand that seriously diminished the supply (oil co's couldn't/wouldn't meet it); commodity buyers made a ton of money and the price of oil got pushed sky-high. But they weren't the ones actually doing the pushing. Blame oil co's and China miscommunicating for that.
In the case of the subprime loans, it was the loads of defaults that killed demand for the value of those loans. Some early sellers might have made a little (or rather, didn't lose as much), and pushed the value so low we see the results now (and now some buyers cleaning up the mess; they're gaining something, yes, but something riddled with liabilities too, and they also bear indirect losses.). But the "value" was in taking an incredibly irresponsible risk in the first place that wasn't properly hedged. Pretty much everybody loses on this one.
That is, it may be zero-sum for traders, buyers and sellers betting on risk ... but it's not zero-sum for the market as a whole. Supply-demand ultimately sets the value, and when the people in control of that act irresponsibly, against their own interest, it screws everybody else as well.
That's why caring about your own long-term interest matters in a capitalist system. If you get selfish for an irresponsible quick payoff (or rather, you're not selfish enough for a greater longterm gain), you don't just hurt yourself but everybody else as well. That goes for the oil co's, China, defaulting homeowners, and the banks ... every one of these groups can be accused of getting irresponsibly greedy, taking a stupid risk and screwing their own best interests, and taking all of us down with them.
(In comparison, if there hadn't been an open market, all of this would have occurred behind closed doors and the fallout couldn't have been hedged or fleshed out at all, and then you could get an absolute market breakdown ... it takes months for the oil supply to even start flowing again because they can't get capital, and banks topple one after another to cover a runaway of defaults.)
Thief13x on 15/9/2008 at 21:07
I'm calm...My money's with Bank of America:ebil:
That said this is a terrifying mess...Sometimes I feel like people are making a big deal out of something we've seen before in history but this shit...this shit is something else.
Quote Posted by BEAR
Seriously though, I imagine this has probably happened before and probably will again. Worst comes to worst I'll just move back home and blow the road and live off the land (actually would be kind of nice) for a couple decades while they get things working again.
You might have a pitchfork but I have a gun;)
infinity on 15/9/2008 at 21:35
I have faith in the capitalist system. Now would be a good time to sell short though...Capitalism is responsible for everything great and prosperous about America, and at every hiccup Americans are ready to denounce it and revert to something else. I believe in freedom.
I say this as an American living abroad though...
Scots Taffer on 15/9/2008 at 23:21
Quote Posted by infinity
Capitalism is responsible for everything great and prosperous about America, and at every hiccup Americans are ready to denounce it and revert to something else.
Everything great and prosperous about America could be argued to have been built on the misery and exploitation of other countries though, so this is Capitalism coming home to roost.
