CDZ redistribution of wealth

[danielpalos]

Is redistribution of wealth, aided by social institutions, from the top down wrong, but from up from the lower strata to the top OK?

Isn't all taxation just legalized theft and 'redistribution of wealth?'

While some taxation's justifiable (gotta be able to build and support infrastructure and the like) too much becomes theft and unjustified.

I agree. Let's dump our wars on crime, drugs, poverty, and terror; and replace them with policies public that better conform to our Commerce Clause.

 

[CultureCitizen]

All those transactions are voluntary therefore legitimate.

And if no one can profit from the movement of goods and services then there is no economy.

So , at some point all those huge corporations decide that the best way to invest their money is in the stock market. But the companies in which they are investing , don't really invest that money in actual production, because the market shrunk , so they instead invest it in the stock market. This , just causes a stock market bubble and zero growth, specially because they can do this with ultra fast algorithmic driven transactions ( all legit by the way) but this leads to economic stagnation.

 

[Skull Pilot]

All those transactions are voluntary therefore legitimate.

And if no one can profit from the movement of goods and services then there is no economy.

So , at some point all those huge corporations decide that the best way to invest their money is in the stock market. But the companies in which they are investing , don't really invest that money in actual production, because the market shrunk , so they instead invest it in the stock market. This , just causes a stock market bubble and zero growth, specially because they can do this with ultra fast algorithmic driven transactions ( all legit by the way) but this leads to economic stagnation.

The stock market is merely an exchange where equities in public companies are traded. You do not invest in the stock market you invest in individual companies via the stock market

Equities in a company do not appreciate if that company has no profits.

If a public corporation does nothing to maintain a profitable position ( if it does not produce anything or provide a service) it will soon have no investors.

 

[CultureCitizen]

Equities in a company do not appreciate if that company has no profits.

If a public corporation does nothing to maintain a profitable position ( if it does not produce anything or provide a service) it will soon have no investors.

That is true ( as the economists say) in the long run.
In the short run that does not happen. And even in the cases where the company has a sustained growth, the price of the shares is not proportional to any of the indicators for that company .
For example , Microsoft's equities were sold at $37 by the end of 2013
By the end of 2014 they had a price of $47 while total revenues increased from 77 billion to 86 billion. The equitiy price is rather disconnected from the revenues (the extreme example of this situation is the .com bubble ).
Regardless of that you can still profit on declining equities by short selling them.

 

[Staidhup]

Actually CultureCitizen those vile evil corporations, as you like to paint them, are purchasing their own stock. Furthermore multinational corporate earnings are coming in below or flat, in relationship to street estimates, due to Oil and decreased European and Asian consumption. At present the market is primarily driven by foreign and individual investors in attempts to hedge against risk and continued low bond yields.

 

[Skull Pilot]

Equities in a company do not appreciate if that company has no profits.

If a public corporation does nothing to maintain a profitable position ( if it does not produce anything or provide a service) it will soon have no investors.

That is true ( as the economists say) in the long run.
In the short run that does not happen. And even in the cases where the company has a sustained growth, the price of the shares is not proportional to any of the indicators for that company .
For example , Microsoft's equities were sold at $37 by the end of 2013
By the end of 2014 they had a price of $47 while total revenues increased from 77 billion to 86 billion.
Regardless of that you can still profit on declining equities by short selling them.

And how does that hurt anyone?

 

[CultureCitizen]

Actually CultureCitizen those vile evil corporations, as you like to paint them, are purchasing their own stock. Furthermore multinational corporate earnings are coming in below or flat, in relationship to street estimates, due to Oil and decreased European and Asian consumption. At present the market is primarily driven by foreign and individual investors in attempts to hedge against risk and continued low bond yields.

I did not use the words vile or evil ( that was your wording ) . I regard them as self interested . But self interest is only usefull when it drives competition, not when it is used in high speed trading (which is not an option for individual investors) or when creating stock bubbles ( like the .net bubble ).

 

[CultureCitizen]

And how does that hurt anyone?

It creates a cash flow clog and utimately leads to recesion.

 

[Skull Pilot]

And how does that hurt anyone?

It creates a cash flow clog and utimately leads to recesion.

No.

How does making a profit on stocks clog anyone's cash flow especially people's who are not invested in that company?

Profit does not lead to recession.

The free and voluntary exchange of goods and services is desirable. Without it you have no economy.

 

[there4eyeM]

By the way, the quotation was from Lincoln.

 

[JoeMoma]

By the way, the quotation was from Lincoln.

Lincoln is overrated.

 

[CultureCitizen]

And how does that hurt anyone?

It creates a cash flow clog and utimately leads to recesion.

No.

How does making a profit on stocks clog anyone's cash flow especially people's who are not invested in that company?

Profit does not lead to recession.

The free and voluntary exchange of goods and services is desirable. Without it you have no economy.

Ok , here it goes , step by step : We have company A has a profit, but since the market isn't growing it decides to purchase stock from company B. Company B has also a slight proffit, but since there is a market contraction it decides to invest it in companies C and D. Companies C and D do the same ( or purchase gold or whatever commodity seems proffitable in the near future ).
So the money gets clogged in the stock without anyone making any actual investment.
Many stock options get overevaluated until the stock crashes, and no productive investment is actually done.
So goes my explanation of the current situation , where economy seems stagnated but stocks are skyrocketing. Care to share your explanation about the aforementioned situation ?


Warren Buffett Stock Market Indicator - Business Insider

 

[danielpalos]

Redistribution of wealth should be considered the "oil pump" of our economy.

 

[Skull Pilot]

And how does that hurt anyone?

It creates a cash flow clog and utimately leads to recesion.

No.

How does making a profit on stocks clog anyone's cash flow especially people's who are not invested in that company?

Profit does not lead to recession.

The free and voluntary exchange of goods and services is desirable. Without it you have no economy.

Ok , here it goes , step by step : We have company A has a profit, but since the market isn't growing it decides to purchase stock from company B. Company B has also a slight proffit, but since there is a market contraction it decides to invest it in companies C and D. Companies C and D do the same ( or purchase gold or whatever commodity seems proffitable in the near future ).
So the money gets clogged in the stock without anyone making any actual investment.
Many stock options get overevaluated until the stock crashes, and no productive investment is actually done.
So goes my explanation of the current situation , where economy seems stagnated but stocks are skyrocketing. Care to share your explanation about the aforementioned situation ?


Warren Buffett Stock Market Indicator - Business Insider

All you did was outline investments.


that you don't think companies should be investing in other companies is irrelevant.

The current situation has been caused by quantitative easing coupled with near zero interest rates.

Since there is no place to get a return except the market that's where the money is going.

 

[CultureCitizen]

The current situation has been caused by quantitative easing coupled with near zero interest rates.

Since there is no place to get a return except the market that's where the money is going.

This is not the first stock bubble , nor the last.
There was a stock bubble in 2000 , there was another in 2008 and there is another one right now.
While QE has something to do with the current situation , this was not the case with the previous two.
The stock doesn't reflect the economic situation.
Perhaps, what is QE but a form of subsidy for Banks : turning their dubious assets into capital .

 

[danielpalos]

Unlimited credit can be pretty nice when you can afford to be "too big to fail".

 

[there4eyeM]

Merely making a profit is not wealth creation. Wealth is not money, though money may be considered part of wealth. Education, heritage and other 'intangibles' are also wealth. Creating national parks could be considered 'redistribution', as it makes available to all what might otherwise be limited or reserved.

'Citizen's' examples express this realization that simply putting liquidity where it gains more liquidity does not make the market place function to the advantage of all.

 

[there4eyeM]

Does no one see the wisdom in Lincoln's observations, even if he may be otherwise 'overrated'?

 

[dblack]

"The purpose of an economy is not producing GDP it's increasing the welfare of most citizens." -- Joseph Stiglitz

The purpose of an economy is as varied and diverse as the people participating in it. An economy is just people working and trading. The question raised by "redistribution of wealth" is whether people working and trading should be controlled by government.

 

[there4eyeM]

'Redistribution', particularly as originally proposed in this thread, is not necessarily something reserved to government to do. Charities redistribute wealth, for example. The 'rich' could intelligently defuse the catastrophic consequences of excess by diffusing a portion of that excess.