They used to say the markets served to allocate capital for the production of tangible products and as such they served a real purpose for society.
Today the primary mission of the capital markets is still “allocation”, except it is about allocating extraordinarily generous compensation and fees to a group of special insiders in a club that runs a trillion dollar betting casino. Compensation levels have no bearing on the value they create. They just suck it off the top of our economy because they can.
It’s now about making money any which way they can for the financier club; and not for allocating capital to the creation of facilities of production. It’s a gang of insiders who pump, dump and con the public and when they screw up, taxpayers have been put on the hook by a Congress that they own.
As Barack Obama once said “White folk’s greed runs world in need.”
In before the unexpected
No-one is Washington has the guts to return the stock market to it’s intended purpose, raising capital for businesses. Short selling, derivatives so complex even the buyers and sellers have no idea of their potential loss. It has indeed become a casino where is all about hedges, trading risk and paying huge compensation for people merely transferring assets from one person to another.
Banks have absolutely no place in these risk management assets and they line so many political pockets it will never go back to the way it was - investment dealers handle investments and banks manage capital.
The Occupy Wall street whackos at least have an essential aspect of their platform correct. Wall Street is corrupt, unregulated and is the antithesis of free market capitalism. It truly is crony capitalism. Look at the Facebook fiasco. Only insiders were offered shares through the IPO for $38 a share. They were hoping to unload it on the suckers who bought all the hype and spent Friday paying the over $ 40. Now the insiders are crying cause they couldn’t fleece the small guy for at least $ 50 a share. Over 500 million shares traded, they got rid of most of it at a profit, in fact the firms that promised the insiders a big fat killing were buying shares to keep the bid above $ 38 most of the afternoon. I wish no-one wanted it and it opened at $ 37. But people were so eager to hand over all that profit to the insiders, they had to delay the opening to get all buy orders in place and set an opening price. The kind of pump and dump you expect from boiler room vermin, played out for the whole world to see.
It’s an embarrassment.
The abridged version; nothing but a scheme to seperate one from their $.
you’re exactly right....the stock market is so rigged and its not about owning “part” of a company; its about jumping in on a bait and switch con game....if you can get in and out, which an individual can not do, you might get ahead....