While I would think that someone acquiring a huge profit could infuse some stimulus into any number of social economies, I also think that a huge loss would equally have an negative impact on a number of economies. The winners might create some job markets while the losers might increase the level of unemployment. So in that sense I don't see anything more than the equivalent of a Las Vegas casino gambling house. I would consider that the market is more complex and strategic with calculated risk; its not like just playing a slot machine or spinning the roulette wheel. A huge concern is how much a market will become subject to manipulation by those who refuse to take a loss.
On Apr 27, 9:16 am, DarkwaterBlight <[email protected]> wrote: > On the surface I would sat that derivatives would have the social > value ascribed to them by those who deal in those markets and those > affected by them. But I much appreciate what JefferyC wrote! I know > little of these markets but what recently skimmed over in the links > which you provided. I think it would make for an interesting > conversation and most definitly be a learning experience! Thanks Slip! > > On Apr 24, 1:58 am, Slip Disc <[email protected]> wrote: > > > > > We know that some people have made fortunes but is there really any > > social value to what seems to be just gambling. Have we really gained > > anything as a society or has it caused more ruin? > > > Almost a year ago US Treasury Secretary Tim Geithner wants to regulate > > the derivative > > market.http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/53212... > > > The wiki definition;http://en.wikipedia.org/wiki/Derivative_%28finance%29 > > > Criticisms of the Derivative > > Markethttp://en.wikipedia.org/wiki/Derivative_%28finance%29#Criticisms > > > Below that the benefits which are clearly outnumbered by the > > criticisms > > > NPR discussion on the Diane Rehm show which you can listen to > > here:http://thedianerehmshow.org/shows/2010-04-23/news-roundup-hour-1 > > AUDIO:http://thedianerehmshow.org/audio-player?nid=12352 > > > JeffreyC wrote: > > > Diane, > > > I am a dedicated listener and I love your show. However, today I was > > very upset that none of your guests new anything about derivatives. > > Their inability to describe how derivatives increase social welfare > > demonstrates what little they know of finance and economics. More > > upsetting is how they pretended to know and still commented, spreading > > misconception and falsehoods. > > > DERIVATIVES allow institutions to hedge against uncertainties, > > effectively reducing risk and volatility in earnings and investment. > > This is good for business as more predictable cash flows allow for > > better planning and increased investment. This has a direct positive > > effect on the welfare of an economy. Also, speculators are necessary > > to ensure that all hedgers are able to place their hedges. The > > speculator thus provides needed liquidity since all transactions need > > two participants. > > > THAT being said, the real topic is whether or not derivatives > > transactions should only take place on a transparent exchange. > > > PLEASE try to have someone trained in economics or finance on your > > show when discussing matters of this type. Thank you. > > > -- > > You received this message because you are subscribed to the Google Groups > > ""Minds Eye"" group. > > To post to this group, send email to [email protected]. > > To unsubscribe from this group, send email to > > [email protected]. > > For more options, visit this group > > athttp://groups.google.com/group/minds-eye?hl=en. > > -- > You received this message because you are subscribed to the Google Groups > ""Minds Eye"" group. > To post to this group, send email to [email protected]. > To unsubscribe from this group, send email to > [email protected]. > For more options, visit this group > athttp://groups.google.com/group/minds-eye?hl=en. -- You received this message because you are subscribed to the Google Groups ""Minds Eye"" group. To post to this group, send email to [email protected]. To unsubscribe from this group, send email to [email protected]. For more options, visit this group at http://groups.google.com/group/minds-eye?hl=en.
