Comments on: Mindless Risk Taking

By: Mindless Risk Taking Ruining Careless Companies - Contrarian Stock Market Investing News - Featuring Bargain Stocks

Thu, 29 Jan 2009 14:27:38 +0000

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By: cal Ennis

cal Ennis — Sun, 11 Jan 2009 17:13:06 +0000

How can i get a copy of you “doubling effect’ of gold?

By: Tickmeister

Tickmeister — Sat, 10 Jan 2009 01:13:07 +0000

I understand the creation of “money” by lending, and how that can evaporate. This article on the other hand gives multiple references to “highly leveraged bets”. As I understand bets, there has to be a counterparty betting the other way. Is that not the case?

By: Sad Sceptic

Sad Sceptic — Fri, 09 Jan 2009 16:28:51 +0000

Tickmeister – in our economy, it is NOT true that “Somebody wins every dollar lost.”. The money never actually exists except as a debt, counted as an asset on the lenders books.
For instance, when you get your mortgage from your bank, no money changes hands. The bank simply counts the money that it “lends” to you as an asset that you owe them. The only thing that changes hands is a promise. That way, if the bank “lends” a whole bunch of money, it can claim all that as “assets”, and say it has so many bajillion dollars in “assets”. There never was any money, so none is really lost if you default. Your money is bundled up with a bunch of other mortgages, (assets), and sold to some other larger bank who will then receive your mortgage payments. What is really being bought and sold is Time; that is, the 30 years it takes you to work your fingers to the bone to pay of the mortgage and interest.

By: Tickmeister

Tickmeister — Fri, 09 Jan 2009 05:52:54 +0000

So who are the big winners? Somebody wins every dollar lost. Who now has the money?

By: Thomas Petersen

Thomas Petersen — Fri, 09 Jan 2009 01:25:36 +0000

Hi Chris,
You have pointed out succinctly the #1 problem the global economy faces today. I call them “Casino Games” and the biggest is the Foreign currency Exchange Trading (Forex or FX). This is where an investor or speculator bets on a pair of currencies i.e. USA dollar vs. Euro to hopefully make money. The average volume of Forex is 1.5 Trillion dollars daily, yes daily more than our national debt last year. None of these bets have anything to do with work production as your article clearly states. Compared to the NYSE which has a paltry 25 billion traded per day but this exchange trades in companies with real production. The Forex was created by greedy financial types for the super rich to make bets. I would guess most working people have never heard of the Forex if they would like to know copy this link for a good explanation: http://www.tradingacademy.com/forextrading.htm
Now imagine, if this amount of money per day (1.5 Trillion) was put into production for the betterment of the global economy. There is a way to get rid of the Forex exchange and stop these global bets. We must go back to the Gold Standard where all currencies are tagged to gold. So all currencies would be worth the same so why brother to bet.
I have been after your Agora brethren to start educating the public on solutions. Here is one that will work.
T Petersen
San Diego

By: Ken Stremsky

Ken Stremsky — Thu, 08 Jan 2009 17:39:21 +0000

Good advice.