QE nightmare

BS > George Soros understood the device BS > rather better - he made a lot of BS > money out of Black Wednesday Do you think that's a good thing, Slowman? Is George Soros your hero?

James Arthur has been a right-wing nitwit for some time - less of a nitwit than you are, but no less ill-informed, if at a higher level. I'm picky about the people I befriend.

Part of the failure of the babysitter club had to do with the fact that it was a SMALL and closed system, as well. It would take a monumentally wealthy and sociopathic person to push the limits of the economy of an entire country to the breaking point, the way George Soros did with the Bank Of England. Government imposed "social responsibility" burdens on employers have a larger day-to-day impact on jobs/hiring/prosperity.

John Major's cabinet and in particular his Chancellor of the Exchequer Norman Lamont were being more than usually stupid at the time, and George Soros showed them up, made a lot of money in the process. What's not to like?

No. He has some admirable characteristics - he not only thinks about what he is doing, but also assembles his thought into books that get published- but I don't see him as a heroic figure.

He's almost as good at making friends as he is at building oscillators.

Nah, he's a lot more successful building oscillators.

BS > George Soros understood the device BS > rather better - he made a lot of BS > money out of Black Wednesday G > Do you think that's a good thing, Slowman? BS > John Major's cabinet and in particular BS > his Chancellor of the Exchequer BS > Norman Lamont were being more than BS > usually stupid at the time, and George BS > Soros showed them up, made a lot of BS > money in the process. What's not to like? It was a trick question, considering you're a sociopath, Slowman. G > Is George Soros your hero? BS > No. He has some admirable characteristics BS > - he not only thinks about what he is BS > doing, but also assembles his thought BS > into books that get published- but I BS > don't see him as a heroic figure. Great morality there, Slowman!

G > Did Soros actually BUY Obama? krw > As much as it's legal for one person krw > to buy another, or one person to buy krw > a Presidency. Soros wrote: The Bubble of American Supremacy: Correcting the Misuse of American Power. Sure sounds subversive to me! and he's got $20 Billion. (Sept 2013)

Posing trick questions is a little sociopathic. I know how you would have l iked me to reply. Would you like to educate the rest of us by giving your i dea of a model answer.

And the moral point you wanted to see made was? I'm aware that he would hav e to be a right-wing nitwit to attract your admiration,and probably America n-born as well, but even you should be aware that neither of these attribut es have much to do with morality. There's nothing to stop a right-wing nitw it from having a moral compass, though there's precious little evidence tha t any of them do.

Your point of view being that America can do no wrong? The people who convicted Oliver North of some 16 different felonies thought differently.

which makes him deeply suspect, particularly since he wasn't born an American citizen.

It is you who are confused.

The true value of the business is the net worth to the economy of everything that it does including making and selling widgets, paying taxes and keeping people in gainful employment.

The share price is whatever people will pay for its shares (and often bears no relation to the true value of the business especially in the .con boom). The latter can be a victim of rumour or market sentiment.

It does if you have inside information about market movements or have ultrafast hardware that is connected to a point 10us closer to the pricing data feed than most of the other market players.

It is much less risky to spread unfounded rumours about them on social media. There have been share prices driven to zero already by haywire algorithmic trading instabilities and it can only get worse!

It does if you destroy the underlying business in the process. If the notional value of the business is lower than the secured loans it has with the banks then they will in some cases deliberately foreclose.

A good concrete example of a less than zero sum game played by greedy bankers to destroy SMEs and maximise their own bonuses has just come to light at RBS in a report out today (yet another banking scandal).

Even you should be able to see how this is borderline fraud and results in destroying good but cash strapped SME businesses that could be saved by deliberately frustrating their bank loans, racking up the bank fees and then finally pulling the plug to buy up their assets in a fire sale.

The SME gets wiped out and the tax man and banks are first in line to divvy up the proceeds. Nasty corporate asset strippers ride again.

No. The intrinsic value of a business--what you'd rationally pay if you were considering buying it--is approximately equal to [the (depreciated) value of its assets + future profits], plus risk, less financing costs.

Paying taxes and other expenses are liabilities, not assets. No one buys a business because it pays more taxes.

That's basic.

Yes, that's price. If you sell me a gold brick for 50 cents the market price of gold might be 50 cents a brick for ten nanoseconds. That doesn't change the value of gold bricks to 50 cents. (But if you're intent on bankrupting the gold industry, I'll help--you spread the rumors, and I'll buy your bricks for 50 cents apiece.)

Any difference between market price and intrinsic value, is market inefficiency, exploitable.

Doesn't affect the value.

But rumors don't generally get the job done.

A. That still doesn't affect intrinsic value. B. You couldn't generally profit from an attack just by spreading rumors. You'd have to take an investment position, generally "short." That's risky; more so if you're betting that something valuable (e.g., a viable company), isn't.

Yes, that can happen. Then they bounce back, instantly.

If you were fast enough you could theoretically clean out the (foolish) seller.

Even you should be able to see it would be a conflict of interest for the bank, plus a foolish position for a borrower to accept. And it's hard to see how the bank profits by losing money on risky loans, then cashing in the borrowers' assets for scrap. It sounds like they're just stupid, and making the worst of their bad positions.

That said, the (81% state-owned) bank in question obviously needs more state ownership. Then it would be better-regulated, have to compete more fairly on reputation and service, and would be forced to be more honest. 181% state ownership should fix everything.

Paying taxes was part of your valuing of a business, so, congratulations, value maximized. Success.

An odd country. Strippers, riding, stealing marginal companies' assets by loaning them money, ruining their reputations, then cashing in what's left at fire-sale prices?

It's a wonder you have any companies left. Or that people bother at all, what with all the strippers.

Ours mostly hang out in bars.

Cheers, James Arthur

funds to short sell and damage a perfectly sound business (or currency). It is a less than zero sum game. Shareholder value is destroyed for everyone except the prime market manipulator(s).

lue.

ything that it does including making and selling widgets, paying taxes and keeping people in gainful employment.

were considering buying it--is approximately equal to [the (depreciated) va lue of its assets + future profits], plus risk, less financing costs.

a business because it pays more taxes.

Right. You've just defined the price you'd pay for the business, not it's value to the economy as a whole. In other words you've failed to perceive t he distinction that Martin Brown was making and have done so in a way that suggests that you are incapable of perceiving that kind of distinction.

I've talked about your ideological blinkers before, but you've made the poi nt so explicitly.

bears no relation to the true value of the business especially in the .con boom). The latter can be a victim of rumour or market sentiment.

price of gold might be 50 cents a brick for ten nanoseconds. That doesn't change the value of gold bricks to 50 cents. (But if you're intent on bankrupting the gold industry, I'll help--you spread the rumors, and I' ll buy your bricks for 50 cents apiece.)

ciency, exploitable.

Wrong, in this particular instance. Martin Brown was talking about the valu e of a business to the economy as a whole - to the community in which the b usiness was embedded. If that business goes away, employees lose jobs, supp liers lose sales, retailers lose stuff they can sell at a mark-up and so on .

In a perfectly functioning free market - which doesn't actually exist - oth er suppliers expand to fill the gap, hire the workers and supply the missin g goods. In the real world, this process takes time, and the rest of the ec onomy loses money while it's going on. Kenyesian economists have the wit to perceive that if this happens too frequently, the recovery process is too slow to keep the economy running close to full capacity and you can get a r ecession which can self-feed into a full blown depression. James Arthur's t eachers weren't that smart, and neither is James.

I am very suspicious of any claim of the true value if it can not be expressed as a number. How would you calculate the true value of say Agilent? I picked Agilent so this is somewhat close to being on topic.

Dan

ything that it does including making and selling widgets, paying taxes and keeping people in gainful employment.

essed as a number. How would you calculate the true value of say Agilent? I picked Agilent so this is somewhat close to being on topic.

The "true value" of a business - in the sense - is perfectly expressible as a single number. Essentially, Martin Brown is talking about a business as a mechanism for processing money. It pays out money to suppliers, employees and organisations that provide it with services - like utilities, but also including local government that provides roads and police and education, a nd the national government that provides defence, courts and trade agreemen ts. to Investors and banks are just another such utility, providing capita l in return for interest or dividends.

It takes in money from the people to which it sells goods and services.

These two streams of money should be equal, in the long term. It's not the business that accumulates profits, but the people that own it aka investors .

The number quantifying either stream of money - divided by the time over wh ich the two sums are calculated - is the true value of the business to the economy in dollars per second or dollars per year.

It's usually called "turnover".

The value of a company is a number which is the value as of a date. Say the value of Agilent on Nov 30 2013 or maybe on Dec 31 1999 ( 8 Billion dollars per Wiki ). Value has units of dollars. It does not have units of dollars per second.

Your concept only gives a number per unit time calculated between two times.

Dan

r which the two sums are calculated - is the true value of the business to the economy in dollars per second or dollars per year.

the value of Agilent on Nov 30 2013 or maybe on Dec 31 1999 ( 8 Billion do llars per Wiki ). Value has units of dollars. It does not have units of d ollars per second.

Your concept of "value" is hard to distinguish from "price". Martin Brown w as taking about "value to the economy as a whole" which is a different conc ept, expressed in different units

es.

No. It is a rate, the measure of the velocity and volume of the transfers o f the medium of exchange. Money only exists to facilitate the exchange of g oods and service, and it really does make more sense to concentrate on how often these exchanges take place, rather than focussing on the magnitude of individual transactions while ignoring how often they are taking place.

over which the two sums are calculated - is the true value of the business to the economy in dollars per second or dollars per year.

the value of Agilent on Nov 30 2013 or maybe on Dec 31 1999 ( 8 Billion dollars per Wiki ). Value has units of dollars. It does not have units of dollars per second.

times.

Well this explains part of why liberals get such oddball ideas. They just do not understand basic concepts like value the same as most dictionary definitions. The misunderstanding messes up the ideas of all the related concepts, including budget, fiscal responsibility and the like.

?-)

er which the two sums are calculated - is the true value of the business to the economy in dollars per second or dollars per year.

the value of Agilent on Nov 30 2013 or maybe on Dec 31 1999 ( 8 Billion d ollars per Wiki ). Value has units of dollars. It does not have units of dollars per second.

mes.

t do not understand basic concepts like value the same as most dictionary d efinitions. The misunderstanding messes up the ideas of all the related c oncepts, including budget, fiscal responsibility and the like.

I'd hesitate to describe josephkk as a right-wing nitwit - he's certainly n ot a nitwit - but here he missing the fairly obvious point that Martin Brow n and I aren't discussing the "value" of a business, but the rather differe nt concept of "the value of a business to the economy as a whole".

I do understand the the basic concept of "value"

but - as the Oxford dictionary makes clear, this meaning is context depende nt, and this discussion involves a slightly different context that the one that Dan, or josephkk, is used to.

Liberals do have odd-ball ideas, That's what distinguishes a "liberal" from a "conservative". Liberals are prone to suggesting that if we do things sl ightly differently, the world may work better. Conservatives take the attit ude that all change is for the worse, and generally regarded the motor car as an inferior substitute for the horse, and the US Revolution as an unmiti gated disaster, substituting the new-fangled democracy for the old reliable , though occasionally imperfect monarchy.