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5/20/2008 11:38 PM
lame duck

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This is economics trivia
5/20/2008 11:39 PM
lame duck

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Why a rich man got perfect timing?

Why a natural disaster in USofA is worse for stock prices than a natural disaster in China?

5/21/2008 5:21 AM


G'day

G'day

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Why a rich man got perfect timing?


Because he was kung fu fighting?

(oh sorry, that's expert timing)

5/21/2008 6:13 AM


die with honor

die with honor

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Why a natural disaster in USofA is worse for stock prices than a natural disaster in China?


Cuz dat be wher da consumin be at ...

A disaster in production tends to inflate prices ... a disaster in consumption tends to deflate prices.
As consumption drops, production drops, worker lay off's in production, marketing, transportation ... everything goes down the tubes ... this is the reason we need to keep Joe 6 pack dumb, fat, and happily spending way beyond his means.

Why a rich man got perfect timing?


They don't ... they simply pay attention to business ... while the rest of the sheepol are deciding whom to vote for on American Idol ... or whatever happens to be what they call *down time* ...
5/21/2008 7:30 AM


Grognard fantôme

Grognard fantôme

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I think your principles are correct Tosk, but I'm not so sure about the empirical reality of it, or at least I wonder if it is not more complicated.

I did a little consulting gig last year that involved looking at various country stats for a number of countries. What really surprised me was the very low rate of consumer growth, and rather high rate of "inflation" (consumer price index D as I recall?) for the U.S. as compared to more incipiently developed nations like China, Brazil, Russia.

I guess it is a matter of whether 1.2% growth on a Brazillion is absolutely more than 5.6% growth on a mere million.

5/21/2008 7:56 AM


die with honor

die with honor

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Look at it on a scale of one to ten with a population ratio thrown in and it is quite simple.

If 3 people are consuming at 8 and they grow to 8.1 the ratio is massively lower than 10 people consuming at one and growing to 1.1. Add to that the difference in emerging pay scale (real disposable income as opposed to credit) and you get some pretty wild numbers.

Economists attempt to make up complex formulas to explain why but it's all BS.

When the Economists get up to speak the wealthy go out for coffee.
5/21/2008 10:46 AM


Culture-Monger

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What's wrong with American Idol? Those David's are MOLTEN HOT BABY!
5/21/2008 11:03 AM
lame duck

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I didnt know Davids could be hot
5/24/2008 11:37 AM
lame duck

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Answers

1. He dont intend to, but it so happens. He owns diversified assets & his spending is set. So when 1 cash cow starts bringing less, he compensates w/the other cash cow. And the market dont start going down untill the rich man starts selling.

2. Desaster drives up transaction demand for money. When money is used for stuff like FEMA trailers, soup kitchens, & transporting of sandbags, less of it is available for buying securites. So that is where disasters are bad for stock prices. It is more so in USofA bcz we got insurance, insurance companies hold securities. So when policiy holders gome to claim, insurance sells. Add that to dried up cash due to transaction demand & u get panics here that make Chinese look like cool bunch.

I think this is wut Tosk said pretty much, although somewhat differently.

5/24/2008 12:52 PM