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The Abandonment Of Free Markets By The Right

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posted on Jan, 10 2019 @ 02:16 PM
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a reply to: TheRedneck

Splitting hairs?

What good does that do?




posted on Jan, 12 2019 @ 09:38 PM
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a reply to: pexx421

I'm going to respond to all of your posts in one here. I'll just quote the relevant info. It's gonna be a long thread.



The average offer doubles on the first day due to them and the others buying the new juicy stock.... then Goldman or whoever was the front company for the offer sells off all the stocks at a massive gain. They just made a huge profit doing nothing.


First, you've obviously never seen the legwork involved in an IPO. Goldman didn't "do nothing." But what you've laid out here as SOP is not true at all. The average first day return of an IPO is 11.7%, not 100%. So that right there blows your whole premise to bits. The reason for this gain is simple supply and demand. Once it goes public there is a lot more demand. It's considered a failure if you price it more than 15% high or low. It's not easy to determine what the stock will go for on the open market.



And it’s not in a vacuum. Money wasn’t created. They just took that money from all the other people buying that stock after them, as when they sell it all it normally goes back down to it’s realistic price. That’s how it’s all a rigged game.


After the first day, over the next year an IPO averages 4-5%. So those people who had their money "taken from them" (by deciding to purchase an ipo stock?) still see a gain over the first year, on average.



So, when rent is increased as it usually is, the apartment complex didn’t do anything to earn that money. It just takes more from the people renting. This reduces the money they have to buy things.


You're very economically illiterate. Does the landlord not spend money in the same economy?



When you miss a payment on a credit card and your interest goes up to 29%. That’s not creating a product, it’s just charging you more.


No, that's a penalty for you not following the contract terms.



If you have low credit a bank charges you more money in interest when purchasing a home. They are not creating a product, they’re just scalping you. And it’s not about risk, as that money is guaranteed by the federal govt on all home loans under 500k.


No, they're not all guaranteed by the government. Please source this claim. Yes, it's about risk as evidenced by your previous example.



Banks aren’t loaning you their money. They literally create credit on their keyboard which is then leveraged by the federal reserve.


Man this is tiresome. The only bank that can create money is the federal reserve bank.



According to my economic understanding the market and us economy will have a massive crash, likely next year. What do you think?


I think this is a fools errand. You've used really loose terms and defined two increasingly disparate terms. So define crash in both the economy and market.



And I’m not sure what your feeling was in 06-07 but I was predicting a market crash then too, while everyone else was raving about how strong the market was.


Sure you were. You must be rich now. Or are you like zerohedge? You declare this is the year for a correction or crash every year and eventually, like a broken clock, you'll be right.



I think the problem is you don’t understand positive economics and negative economics.


Because those aren't economic terms.



Negative economics is things extraction based. Things like high interest, capital gains, monopolized services Or products, increased rents that largely take fluidity out of the economy.


Fluidity refers to how things flow in the economy. Typically jobs. I don't even get what you're saying here because economics studies all sides of all transactions you're breaking things down into subsets that are part of the same equation. It's an inaccurate way to look at things and it ignores the whole of the economy. You are making weird assumptions that "unearned" money is not part of the economy and is not spent in the economy.



Since 08 all our “economic growth has been in the financial sector, extracting fluidity from the economy.


That's simply false.
Have a look



If you take away financial growth from the gdp, that’s interest, privatized services, real estate, the fire sector, our economy has actually been contracting. And hat is not the presentation of an economy doing well or growing.


I'd love to see your source for that because my above source pretty well destroys that, but you are obviously reading this stuff somewhere.
edit on 12-1-2019 by Dfairlite because: (no reason given)



 
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