I know you haven’t been around much. You are talking to one of the few on this board that knows economics and finance better than the average Econ or Kelley grad.
Congrats on missing the gains in 2024. Pretty sad you missed out.
Stock markets have already recovered the losses they suffered in April. What is going on?
- Thread starter sglowrider
- Start date
I know you haven’t been around much. You are talking to one of the few on this board that knows economics and finance better than the average Econ or Kelley grad.
Congrats on missing the gains in 2024. Pretty sad you missed out.
I hate when people make statements like this. If that's your position, make a huge bet and see how it goes. People that complain things are cheap or expensive and don't put their money where their mouth is are worthless.
Everything is relative and if people are comfortable paying 25x for earnings, maybe that is the current "normal"? All of these "value" guys get bent out of shape when growth is more in favor and vice versa.
Okay Mr. Smarty Pants. Tell us the answer to this question:
What is the airspeed velocity of an unladen swallow?
0. It smashed into my window yesterday evening and is now laying on the lawn... lifeless
The Chineses in town went on a month vacation. Supposed to be back May 2nd. Still not open. I need coconut shrimp dammit
What do you mean? African or European swallow?
The NYSE represents the top firms in the country which in many ways are the powerful invisible hands of our marketplace. Politics and government can cause temporary downturns, but ultimately the invisible hands manage to stabilize investor emotions.
The stock market, however, doesn't tell the whole story IMO. It doesn't always reflect the concerns of the millions of ordinary Americans who depend on businesses not part of the companies on the NYSE exchange. People whose savings and investments are so scarce that real life emergencies can sink their ship. Emergencies such as illnesses and job layoffs, or something as simple as auto repairs.
These ordinary citizens take no particlar joy in the stock market returning to normal as they have lots of other things to worry about.
Soooo the monty python and the holy grail reference was not recognized?????
No, the Nasdaq developed a reputation based on its clientele as more growth-oriented than the sleepy, cash-flowing NYSE.
I looked him up.
Two things jumped out at me. First, he's an advocate of Modern Monetary Theory (MMT), which is among the most fringe schools of thought in economics. It has the dubious distinction of being rejected by every other prominent school of economic thought...which is to the economic world what a 9-0 SCOTUS opinion on a contentious matter is in the legal world.
MMT has been pushed here by the likes of AOC:
(Ocasio-Cortez) said she was open to Modern Monetary Theory, a burgeoning theory among some economists positing that the federal debt is not an economic restraint for the US. She said the idea, which holds that the government doesn't need to balance the budget and that budget surpluses actually hurt the economy, "absolutely" needed to be "a larger part of our conversation."
They're realizing that they've "run out of other peoples' money", so now they've just taken to basically saying "So what? We can print all we need."
Second, he's closely associated with Jeremy Corbyn...a man who penned a heartfelt obituary thanking Hugo Chavez for all he did. Apparently, Murphy was expected to have a prominent economic role in a Corbyn government, had he become PM.
Also, calling stocks a "Ponzi scheme" demonstrates either a lack of knowledge of corporate equities or a lack of knowledge of Ponzi schemes. Are there highly speculative stocks that are ridiculously overvalued based largely on near-term demand from speculators...making them ripe for big selloffs? Yes, of course. Does this make "the stock market" a Ponzi scheme? No, it doesn't.
What do you mean? An African or European swallow?
@Mark Milton I didn't remember this part of it, but laughed at the clip. Looks like I need to rewatch the whole movie.
I think his premise re: ponzi schemes was more than the reduction in publicly traded companies since the Dot Com bust has contributed to outperformance and overvaluation of public equities. Of course, if he were right, he would have missed out on the best long-term bull market in history.
So, he's either wrong and rich or right and stupid. Give me the former any day.
Oh man…that’s when they close off the joke.
The first part at the castle is just the setup.
The video was referencing the FTSE 100 (the main UK index). Which has had low valuations for years. I think it's trading at like 12 or 13x earnings and has something like a 3.5% dividend yield. It's the definition of a value index (particularly compared with the growth tilt of the US/SP500).
The FTSE 100 price index... It's at 8500 now. It was 6900 in....1999! 26 years later and up less than 25% total. Obviously would have been collecting dividends so total return is better than that, but
If that's a ponzi, it's not a very good one.
Also in the video he seems to be complaining about 'pensions' being invested in the market. I assume he means individual retirement accounts, that operate similar to the 401k in the US. What does he think defined benefit plans (traditional pensions) do with their pension funds?
Too much discussion about a guy who doesn't know what he's talking about in this thread. But he made a reference to the switch from the UK guaranteeing a pension to people (through tax revenues, I assume) to making people save for retirement "with their own money."
I wonder, though, if that emeritus accounting professor (not a finance professor) would think the Bailey Bros. Building and Loan was also a Ponzi scheme:
My favorite movie of all-time. This scene makes me tear up every time, especially when Mary holds up their wedding money and says "How much do you need?"
I don't track the FTSE, but I imagine it's suffered the same fate as most developed public markets - shrinkage. The cost/benefit of being public isn't what it used to be.
Also, that performance is insanely putrid, even in a lower inflation, lower growth environment.
I assumed he was referring to the defined benefit plans and lackluster returns creating risk for recipients, but admittedly got bored after the first minute.
The guy in the video essentially wants a govt. DB plan. Doesn't think govt default is a thing, I'd guess.
Are pensions not the ultimate ponzi scheme? If too many people exit and want payment, it collapses. That's even more so without pensions investing in risky assets.
