The thing about the stock market that bothers me.

Having better odds does not mean its not gambling.

Gambling = take risky action in the hope of a desired result.

All experienced stock speculators expect to lose some and win some, and they believe they will win more than lose. There are low-risk stock investments and high-risk ones, and some where you can lose more than you invested.

 

It does, and that's exactly what open free markets do.

For thousands of years human beings have exchanged goods in the free markets and while it's hard work it's how we create wealth. To sit back and whine about those that create weath --versus doing the hard work of creating it-- is lazy and irresponsible.

 

OK, if u want to change the meaning of the word from what most folks use to some screwing meaning that you prefer then that's your choice.

If we do a quick google (key words define gambling) we end up w/ lots of hits that typically include the phrase "game of chance". Breathing in and taking a "gamble" that we won't breathe out again is NOT a "game of chance". A farmer taking his harvest to the market w/ the risk that no buyers will show up is NOT a "game of chance".

Now, if you want to say that breathing is gambling then I'll just banana the tree and settle my water out.

 

Stock market carries significant risk, so its very much a game of chance.

Breathing is something we must do to stay alive. Short-selling GameStop stocks is not something anyone must do to survive, but many made the gamble and lost lot of money. Heck, during the great depression people jumped out of their windows after losing their life savings + some in their gamble at Wall Street.

Farming can be a bit of a gamble and many have lost everything trying and failing. Many have tried to grow fruits and crops in places which are not suitable, and lost the gamble.

I didn't say anything about breathing, - you did.

 

This is correct. Investing long term in the stock market through buying and holding of index funds is not gambling. Why? Because one invests in the long term productivity of American (and international) companies as a whole. On average, this productivity has gone up over the last century, despite some temporary dips in the stock market.

On the other hand, day trading or market timing are gambling. Why? Because the main objective here is not to harvest the productivity gains of companies, but rather to make profit off the random fluctuations of the stock market. Nobody can predict those random fluctuations in the long run, not even computers or AI, which is why market timing is a losing proposition.

 

~ Follow Nancy P 's stock buys. You'll never lose ...
Personally I invest in Hunter Biden’s artwork . Very good return !

​

 

Yes. Good point. There are low-risk and high-risk types of stock market investments.

 

In virtually any field of endever there will always be some self-destructive fools who waste their resources. It happens in the super market, in sports, and equities markets are no exception.

That doesn't change the fact that folks who squander their money will either stop on their own accord or will stop when they run out of money. Given the fact that overwhelming majority of people who work in the market place create wealth, we can ignore the losers.

 

Yeah, and electricity is very dangerous --it can kill people-- so every time u turn on a light it's "gambling"? Let's get serious.

Human beings breathe, poop, and work to feed themselves. Some folks work at farming, others mop floors for a wage, and yet others short sell shares of Gamestop Corp. This is what humans do to survive.

--and the fact that eventually we all die doesn't change the fact that right now we're alive. Farming is hard work. It can be risky. The farmers that fail to manage their risks end up losing their money and they switch to running a convenience store. It's life.

Huh, in your second response you talked about breathing but if you argue that you were repeating what I said then I can say that I never said that you said anything about breathing but I won't because u'll just say that you never said that I ever said that you said that--

Are u aware of how silly this convo's getting?

 

I wish you'd get serious as opposed to trying to compare stock market speculation to breathing and turning on the lights.

Are you aware that its you who makes it silly?

If you don't think stock market speculation is a form gambling, but rather comparable to breathing, then so be it.

 

No argument from me...

 

thanks, sometimes it seems like we got fewer & fewer sane people on these threads..

 

Maybe this is where our disconnect happens.

Some people work mostly in the capital markets and others work largely in the labor markets. Virtually all of us work in both. There's this comic book belief that only those the labor markets are 'working' and everyone in the capital markets are 'non-workers'. Thank you Karl Marx.

My daily experience half farming and half capital markets --right now I'm all interest accounts but I'm open for equity trades all the time. To me, this kind of work --be it farming or financial trades-- is the same as breathing or turning on a light. To me this is serious.

You're telling me that this is not your experience at all and thus u and I are unable to relate. We can leave it there if u want, I'm easy. Another option is we can continue the convo while being more careful to understand each other's varied backgrounds. Your call.

 

You're describing, accurately, the aftereffects of central bank manipulation and 'magic tricks'. But we've seen what happens when the Fed's role in propping up the stock market is even slightly diminished with microscopic interest rate increases -- the stock markets drop like a rock! If the 'value' is there, then why do the stocks drop so suddenly and so deeply, just because a central bank stops feeding the inflation that it had a very large part in creating in the first place?

Sure, at the moment gamblers are playing with their usual mechanisms of "catch-a-falling-knife" and betting on the "dead-cat-bounce", but remember what happened when the 'virus' weighed-in on the economy in 2020...? THAT was when we saw what true value of equities were!






search recall marker

 

I said there is risk in stock market speculation, which is a well known fact, and you compared that to the 'risk' of dying after taking breath, or from turning on the lights.

We can agree to disagree. You do not think market speculation is 'gambling', not even the high risk bets, and I think the high-risk bets are gambling. It boils down to word games, and I have no interest in it. I understand the risks, and choose to participate, but steer away from high-risk speculation. I am a steady plotter. You downplay the risks to a point where its non-existent, so all I can do is wish you luck, but typically people who do not understand the risk get burned.

There was no "dead-cat-bounce" in 2020. The markets fell like a rock, and the begun to recover when people realized the crash was temporary. A "dead-cat-bounce" would mean there is a temp recovery and then markets continue downward. We'll see what happens next year, and if you think it continues to fall, then I hope you are out of the markets.

 

I'm old, so I've seen the spectrum of change over many decades. Unfortunately, there is a pattern that is generational. A family coming from hardships focuses on bettering their lives and that of their children, and they have learned how to do that the hard way. Their children have seen some of those hardships, but endured far less and have had a better life with a lot more taken for granted and less earned. The next generation however comes into the cycle at a point where the hardships of the past are simply ancient history, not something they think is relevant anymore.

Because of this, generational wealth- the wealth of a family that we pass on to our children to make things better for them, is increasingly used rather than built on. About 70% of wealthy families lose most of that wealth in the second generation, and about 90% of it in the third. This despite wealth being much easier to acquire for them than it was for the first generation. The same thing has occurred with the value system. Grandfather had to adhere consistently to certain values to succeed, but each generation we try to make things easier for sees less and less need for that. This is an erosion of primary values- and the capacity to think and reason clearly. I think most of all, it dilutes the importance of personal responsibility as the source of power over your own life. All that creates a gap of reason over generations, and many young people simply dismiss the idea that they could learn from the people who have already been where they are going. That is indeed visible on forums like this.

I think it comes down to not being able to find value in things you haven't had to earn; and today, we have a political support of entitlement, the idea that nothing has to be earned.

 

The highest paid fund managers can't outperform index funds.

 

Thank you for your concern. Yes, I most certainly am totally OUT of the "Big Casino". I enjoyed success with stock options I earned with the last corporation I worked for before I retired, and then I got the hell out -- on top! I don't trust the Federal Reserve central bank as far as I can spit into a hundred-mile-an-hour headwind, so, it follows that I don't trust the stock markets, either.... When the time comes, I hope your 'parachute' doesn't have any holes in it.






search recall marker

 

If you are retired, then its best to play it safe anyway.

 

Yes, but not too safe. You need some stocks in your portfolio as inflation protection. The general idea is to never go below 30-40% stocks, even in retirement.

 

I think that is more or less standard recommendation. Now they have the "Target Date" funds which balance it for you based on your age. Some people like to make their own calls however, and might have other means like rental properties etc.

 

On the day that we abolish a central bank, like the stinking Fed, and go back to relying on the Dept. of the Treasury, as we were prior to 1913, I'll certainly go back into the stock markets. But, that isn't going to happen until/unless these manipulating central bank criminals wreck the entire economy first....







search recall marker

 

Are not computer algos involved in stock purchase choices? I thought they were.

https://algorithmictrading.net

 

Doesn't negate my point.

 

Your point is fair, but cannot exist in real life.