Replies to post #10584 on Short Term Trading Member Forum

[Manti]

My thought on Zero Sum: (I only have one)

Company ABC ipo's 100,000,000 shares at $10.00 Of those, 1% are free trading, the other 99% are just held because the purchaser doesn't feel like selling. If the sp goes to .01 through the trading of the 1%, the holder of the 99% has virtually nothing left, and no one has gained what was lost. How can this be zero sum?

By the same principle, if the sp goes to $100, the holder of the 99% has tremendous assets which make him wealthy (at least on paper), and it could be used as collateral in many cases, and there has been no influx of money to account for the increase. How can this be zero sum?

I think the machinations of the market has more influence on the perceived wealth of the world than I would really like to see. If we were smart, we'd tie the value of the world currencies to grain, or some other necessity of life, rather than paper, or worse, cyberspace.

[Toppcats]

4godnwv - With respect to changes in liquidity - this can be reflected in monetary change by fed fund creation AND by change in the stock shares available in the underlying entity.
Both will affect the variable coefficient {z} since both ultimately affect liquidity.

Gary