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Samizdata, derived from Samizdat /n. - a system of clandestine publication of banned literature in the USSR [Russ.,= self-publishing house]

Samizdata quote of the day

“The stock market is pure capitalism. The stock you buy doesn’t know if you’re white or black, male or female, old or young, American or French. Prices are dictated by supply and demand and nothing else. It’s global, efficient, wildly volatile, always surprising: raw and beautiful.”

Ken Fisher investment management chief and Forbes columnist.

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5 comments to Samizdata quote of the day

  • Ken

    There should be no color but-as I’m in USA-green,or gold or what ever color your money is-except for those pesky debased Zim.$ -to a buisness person.
    (we want our payment in swiss francs, damnit!)

  • Paul Marks

    Accepting payment in Swiss Francs would have been a very good idea over the last few years.

    As for the Stock Market:

    It is distorted by the regulations of the S.E.C. and so on (offend the powers that be and you will find yourself in prison on some trumped up charge), and the demand for shares is influenced by the supply of credit funny money from the Federal Reserve system (all the credit money has to go somewhere and the stock market is one of those places).

    Even in the 19th century the Stock Market in the United States was influenced by the booms and busts of the banking system (backed in various ways by government) and in Britain by the Bank of England.

    However, I think the quote given would have had a close connection to the truth in the 19th century (the “long 19th century” than ended with the First World War), at least there was no S.E.C. or other such then.

    Even today the quote is not totally wrong. Investing is not totally a matter of guessing which way the Fed will shove interest rates or what other tricks it or other entities will play.

    There is still the basic work of serious research into a company – to see whether those nice looking financial statements are true.

    Judging a company – judging whether it will produce the right products at the right price (and is not loaded with open or hidden debts) is the same as it ever was.

    Even given the same facts different investors will come to different conculsions about what is the right way to go.

    Some people will think that a company is going to produce the right products – and some will not.

    And some people will think the methods of production the company has chosen are the right ones – and other people will disagree.

    The market is still a “discovery procedure”.

  • Johanthan

    By the way, Paul, I think Fisher would agree with all of your points (full disclosure, I have met him several times and we have become friends); he loathes Eliot Spitzer, the former NY AG, with a passion.

  • Hold the green, just send gold

  • Paul Marks

    “Judge a man by his friends” – perhaps, but also judge him by his enemies.

    If Mr Fisher has you Johnathan as a friend and Mr Spitzer as an enemy – my guess would be that Mr Fisher is a good man.