Well Esther, I am not French though I love them. I don't understand them
much. I love what they have done with their countryside. It is so,....je ne
sais quoi, so bosque-y.
I am not a mocker, Mocking is anathema to me. Death to mockers. This list is
not for mockers. Mock not, lest ye be mocked. Mock me, mock my cat.
Now, gang, I suggested two months ago that the Stock market was overvalued.
Actually I likened it to an enormous Ponzi scheme.
Ponzi Scheme: Early investors are paid off well so as to induce others to
join in.
Sunken Costs: What you paid for something less what is it worth today. (That
money is GONE regardless of how long you retain the item.)
Russian Investors: Those people, on TV today, crowding into the banks in a
futile attempt to exchange rubles for "hard" currency.
Financial Instruments: Let's start with "Derivatives"
A Chinese guy in a Singapore Bank and Noodle shop decides to offer a 100,000
bet that the S and P Futures will rise 100 points by close of business
September 15th.
Your Banker, (let's say Brad Wilson, a mouth-breather you knew in high
school, and wouldn't date in a million years) decides to take that bet and
uses the hard earned money you just earned over the last 10 years.
Now lets say that Fu Wan, the noodle shop owner is not making any money from
noodles OR banking decides to close up shop the day Brad expects to collect
on his bet. Well you can see the problem. You can't get noodles from a
stone. Of course Brad can always box groceries at the Piggly Wiggly but what
about your money? It is lost forever.
See, a Derivative, like many other "financial instruments" is not backed by
any tangible thing, not even a bowl of noodles.
OK, you say, thanks but I NEVER would invest in such a thing. Fine, but the
guy running your retirement fund will do so cheerfully.
(Please e-mail me off the list if this kind of news is annoying and I will
stop. It really has no place on the Gardens list but it has been on my mind
of late and I just couldn't hold it in.)
I personally aspire to someday being called une moqueuse. That is to die for.
Esther
who is torn between moral gratification that our financial markets are
actually affected by the economic pain being suffered in eastern europe and
wondering how I will feel when I see minuses on my 401k statement. (You
can give the peasant a salary but if you take her too far away from the
earth she gets confused.)
snip
