THE MEANINGFULNESS OF THE MARKETPLACE

11 08 2011

Authored by William Robert Barber

Every American is seeking financial surety. Or so says, the select, the brethren of those that comprehend most if not all things. If one seeks such surety one must not make bets in equities, commodities, and avoid the Chicago Mercantile Exchange. One must stay far away, vesting with neither FOREX nor dapple in futures with variable options. And certainly, one must never fool one’s self by creating the self-delusional notion that these at risk bets are anything close to a prudent investment.

George Know-it-all, PhD from Harvard, Yale, and Princeton a renowned wonk who has mastered the obvious points out that: Financial markets have been swaying vertically for thousands of years. George emphases the meaningfulness of financial markets’ by the illustration that in order for a market to go up it must go down. Therefore, George suggests, that the facile objective for profitable performance in the equity game is to buy the instrument when it is down and sell it when it is up. George is right there with Obama when it comes to market economics.

Setting aside the comments of Mr. Know-it-all, PhD the essence of a viable stock exchange is measured in no small part by the fluctuation of its dynamics. A flat line market will not create the necessary action of buying and selling. Financial upheavals and disruptions within the global marketplace off set the elements of the contrived and mundane. Most of us in-trust our investments to licensed brokers, mutual funds, or bankers; in other words, few of us understand the melodrama of striving to invest for a profit. Hell, most of us cannot comprehend the financial prospective of the company one is channeled to invest in.

Since there are no harbingers, how does one select an equity or investment instrument? Well, here is the standard institutional response. Diversify and invest for the long-term…that’s the standard answer. This is the traditional answer because all of the licensed brokers, on-the-street stock pinking pundits, and genuine geniuses are really nothing more than professional guessers. The only true and tested method of picking whether a stock or commodity will appreciate or depreciate is after the event. Post betting is however not only very difficult from a working practical perspective but illegal.

Today’s smart bet is gold. A commodity whose mainstay value (popularly pronounced) is as a hedge against fiat currency. Well, I have always found that an interesting evaluation. No one is going to take their futures gold contract, gold coins, or bulk gold bullion down to the store to buy a loaf of bread without first converting the gold into fiat currency. Therefore, when the collective one(s) sells (in volume) one’s gold in order to buy bread the price of gold will drop as it exchanges itself into fiat currency. If that is so then I find it difficult to understand the difference of buying gold than buying IBM stock or any equity for that matter. The objective is to purchase a value that appreciates while still retaining marketable liquidity.

Now there are those that profess that gold is the only true value. And when Armageddon rages across the land gold will prevail as the only true commodity with surety; hmm…If it comes to that I don’t think the prevailing commodity with surety will be gold-I think it will be lead.

In closing, those who are vested in the equity market hang-in there another Phoenix is close at hand-the election of 2012. This nation of ours is the greatest consumer nation that has ever existed. And one more comforting note, we have the most lethal armed forces that have ever existed. These forces are distributed around the globe. In the end of the end, in any scale of meaningful measurement, we are Hercules and the world depends on us to hold them up high above the chaos which would surely develop if there were no United States of America.

Advertisements

Actions

Information

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s




%d bloggers like this: