Wall Street and Stocks - Worth Investing In?

[Marc]

Wall Street and Stocks - Worth Investing In?

"Seventy percent of the volume [of trades on the stock market] is computers that are run by the banks playing ping pong with stocks for 10 seconds at at time..."

"The stock market at this point, which used to be a reflection of the future value of actual businesses in this country, has been turned by our government and our banks into little more than a paper shredding facility [about which] we can make up reasons why it goes up and down," Ratigan said. "But when the computers ... at the banks are controlling the action, most everything else is kind of silly."

Your opinion and/or comments?

Disclaimer: I no not own any stocks or bonds. As some of you know I have (I will not use the term 'invest' or 'investment' which implies I will make money) physical gold coins, but not because I think they will make money for me, but rather because I believe physical gold will keep up with inflation.

[mguilbert]

The market (whether Wall Street or Commodities) has always been manipulated by the "big dogs". Below is a wuote from an earlier post by me when the supposed computer caused the one day crash.

i.e. This story is about stolen software some may remember it. It is linked below. Here is the quote from the case “The bank has raised the possibility that there is a danger that somebody who knew how to use this program could use it to manipulate markets in unfair ways,”. I wonder if GS uses this software that way. After seeing what happened yesterday makes me wonder.

http://www.bloomberg.com/apps/news?p...d=axYw_ykTBokE "

That is why I am afraid of any new market that is created ie Carbon Credits.

BTW. How do taxes work on Gold? When do pay taxes on Gold only when you sell? Do you pay the taxes based on increase in value only or the sale price? Just wondering.

Thanks,

[Jennifer Kirley]

I know a couple of things for sure:

1) If I had invested that couple of $grand in Home Depot when I was considering it in 1988, I'd be a millionaire now.

2) There are many honest companies, but also many that are using the market as a casino and the small time investor can be very challenged to know the difference before it's too late.

I think if you can find a company to invest in for old fashioned reasons, the market can still be worthwhile but in general it's like the Gulf of Mexico - too easily ruined by bad behavior in the really big players.

[Bill Pflanz]

The large managed pension and insurance funds are probably having more of an impact than banks. Banks are generally into loans not investments. I do agree that giving daily reasons for the market ups and downs is silly. It is like trying to describe common cause events in quality when it is just normal variation.


Over the long run, stocks have done about 8-9% and dollar cost averaging will fix the ping pong effect described.

Bill Pflanz

[palmer]

There used to be a Marion Laboratories that was named for the wife of Ewing Kauffman who also owned the Royals baseball team.

I had a supervisor who constantly bought stock in it from the late 70"s thru the mid 90's.

That stock split almost every year. He didn't buy lots but over the years, with the splits, he sold it when Allure (I think it was them) bought them out. He retired a multimillionaire.

I have cashed out 2 401k's over the years. One was recent. I had almost tripled my money in each of them. But I also managed them as well.

These are examples for my answer to your question......

Yes but not when the market is high. It's always the buy low sell high deal.

Would I say this in 10 years? probably.
Would I say this in 20 years? maybe.
Would I say this in 30 years? probably not.

The reason for the decline over the years? From my perspective, (I'm not a broker and never read the market results in the daily paper) I see it declining and becoming like so many other things that were once solid and good.

Too many hands in the cookie jar and too many manipulating it. Eventually someone or a company will cause the market to crash and not regain....

My opinion.....