Tuesday, June 28, 2005

Inflation?

Inflation is when too much money chases too few goods.

The shelves are fully stocked, the only reported ‘shortages’ out there are in energy ‘futures’ market so what’s up with Google?

Like Yahoo, a stock that started out trading for a few dollars that soared to over $440 a share before the bubble burst, Google is now trading at over $300 a share.

Could this be too much money chasing too few investment opportunities?

Where do you suppose this money is coming from?

Why yessiree Bob, it’s the billions of tax dollars that we’ve poured into Iraq. It’s sitting there in the world’s largest money shredder, waiting to be vaporized.

The ‘bubble’ will burst, the stock will drop like a rock and ‘poof’ the money will ‘disappear’ (into the pockets of the insiders, just like the eight trillion that ‘evaporated’ when the Internet bubble burst.)

But wait, does that money really vanish?

What really happens when a stock ‘loses’ value?

Those who invested in the company definitely take a hit on the head but where do those very real dollars actually go?

Somebody has to get them, the money is still out there somewhere. Heck, somewhere out there the first dollar ever minted is still floating around.

So the money is not actually ‘lost’ it just changes hands.

Who gets it and why is something I think we’d all like to know.

For there is a whole segment of the market that bets against stocks, a weird and more than a little shady proposition.

‘Shorting’ stocks can be done at any time, even as the stock starts to fall and could conceivably make a stock fall farther than it ordinarily would.

I don’t trade stocks so I don’t know the answers to these questions. This may make me ignorant but never confuse ignorant with stupid.

Google is a search engine that sells ad space to companies on their web pages.

From what I gather in the papers, the profits to earnings ratio don’t justify the high price of the stock so what the heck is going on?

Is this an example of investor stupidity or are we witnessing another boiler room operation designed to fleece the greedy?

Seems they fall for it every time, don’t they?

Rationally speaking, there should be no such thing as a ‘stock market’ just as the ‘rules’ regarding money and it’s ‘legal’ uses are total BS.

Like time, money is a human invention. Both are physical manifestations of something that in reality doesn’t exist.

To put a finer point on it, you’re busting your stones for nothing. Money is a figment of your imagination, the pieces of paper and the six coins are exactly that, pieces of paper and stamped bits of metal.

While these items ‘represent’ wealth in our minds, the fact they are not in themselves valuable leave the real producers of wealth vulnerable to being robbed by those who issue this worthless representative scrip (i.e. central banks.)

And so you have it good citizen, a situation where huge sums of cash are resting in the hands of too few people.

While our society crumbles.

Some people, some, are making huge profits from the war while others are making tremendous commissions by loaning out tons of foreign subsidized mortgage money to anyone with a pulse.

When these damnable/irresponsible lending practices come home to roost, these people will have made a ton of money by burying their fellow humans in debt that can’t possibly repay.

One can only imagine that their response will be, ‘We can’t help it if you’re stupid!’

While it’s hard to gauge whether or not the concept of labor driven society is gaining any traction out there, the fact that all debt and debt instruments would instantly become illegal will certainly go along way towards making the idea much more attractive.

While almost everyone has investments the true investor segment of our society is that top one thousandth of a percent of our population.

They are a parasite that we as a society can no longer afford.

Everyone pulls their weight and in doing so reaps their share of the bounty, equally.

No one who wishes to participate will be left out. Don’t have a job now then a job will be created for you. Don’t want to work; you will be invited to be elsewhere. There are no free rides save for those totally incapable of participating through no fault of their own.

In this way we will achieve a balanced economy. Everyone works and contributes thereby providing them with the means to procure the items they want or desire.

Like all change it will be a tough slog in the beginning. However, a vast majority of us will instantly be a hell of a lot better off than we are now.

Only the wealthy or those precious few people (like CEO’s) that right now make more money than they can spend will feel a ‘crimp’ in their lifestyle.

I think it’s a small price to pay for elevating millions out of abject poverty, providing them with a future as well as giving them a stake in the success of our society.

We can save ourselves and our children from the coming crisis but the will to act must be there.

I leave this matter in your capable hands, trusting that you will finally act in your own best interest now that a vehicle to do so has been provided.

Thank you for letting me inside your head,

Gegner

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