Questions about world financial issues. And also a what if?

Now before I say anything let's exclude all of the "so we can own all the countries one by one" or any of those conspiracy theories or beliefs. Also I only ask these questions and think about things like this because without money (and some sort of system that ensures a fair share of necessities and stuff to live on for everyone) we would live just as we do now without the stress of money. We get all of our supplies, food and materials for everything we need to stay alive and keep civilization going from earth and we don't have to pay earth a dime.

I am semi-educated in how the market works as far as common stocks are traded, charts are read and such. I don't know much about currency trading or anything else but I don't think it will matter much. Basically I know enough about the financial world to ask the question, "Why does it have to come to economic crashes?"

Why do we allow the stock market to crash? Why not, in order to prevent years of more bankruptcies and more debts to pile up, push money aside for one second and look at the bigger picture?

First of all I need to ask who do countries with major debts owe? Companies and other countries is all I can think of. With this being said I'm sure it's possible but doubt we owe any type of enemy country serious money. Now if us and an ally country are at all allies and we owe a debt why not clear it. The government made money and it would only make sense that we can control it and bend the rules if the final outcome is worth it. I as a citizen wouldn't mind working for free for however long it took to prevent an economic collapse. If Greece didn't get promised help, which in my opinion were more cheap words to try and give traders a false sense of security , the market would have supposedly took a hard hit and stuff could go right back to where we were just last year or even worse. Eventually it would begin to affect everyone and mortgage debts rise once more, as well as automotive debts and once again the government and many companies are in a #hole once more and we all suffer.

I know something like this would never happen but I want to know reasoning behind it, if any, besides the greed.
When money was created man stopped worrying about each other and most began to care only about themselves.
If these countries were to come to an agreement like this and a very thought out plan that would involve lots of pros and cons for both the common person and "the man" were created I think it would be an awesome start in reuniting the public and reminding everyone that a little teamwork benefits us all even if life is different for a bit.

Originally posted by seangkt
Why do we allow the stock market to crash? Why not, in order to prevent years of more bankruptcies and more debts to pile up, push money aside for one second and look at the bigger picture?

First of all, when it comes to markets, there is no "we." There are millions of buyers and sellers, from some daytrader dealing in 2-figure amounts on his home computer to managers of massive pension funds and national players like Asian sovereign wealth funds dealing in billions of dollars at a time. How could you even begin to forge a consensus among these people, most of whom don't even speak the same language or live in the same time zones? Think "tower of babel times ten trillion." The only thing that unites them is they are all trying to make money, or at least avoid losing money. Its an emergent, self-organizing system, not one controlled from the top down by any kind of "we" that can make rational decisions.

Market professionals face a stark choice every day they log on or head to the office: Either they make money or they lose their jobs. To "push money aside for one second and look at the bigger picture" means to give the competition an edge. Any trader or fund manager who acts this way will quickly find himself without a job.

First of all I need to ask who do countries with major debts owe? Companies and other countries is all I can think of.

Countries with debts owe money to anyone who holds their bonds. This includes companies, countries, individual investors, and your mother's pension fund. Try explaining to granny why she has to eat cat food for 20 years because somebody decided to "clear the debts" that comprise her pension fund and pay for the interest in the bank she keeps her life savings.

I as a citizen wouldn't mind working for free for however long it took to prevent an economic collapse.

That's very noble of you, but with a negative net savings rate, most people are living month-to-month. What happens when somebody needs a dentist, or to insure their house, or merely to pay the mortgage on their house? "Working for free" isn't going to cut it. That's how starvation and homelessness happen.

If Greece didn't get promised help, which in my opinion were more cheap words to try and give traders a false sense of security , the market would have supposedly took a hard hit and stuff could go right back to where we were just last year or even worse. Eventually it would begin to affect everyone and mortgage debts rise once more, as well as automotive debts and once again the government and many companies are in a #hole once more and we all suffer.

Again, very few can afford to think for the long term because their own jobs, livelihoods, and grocery bills are on the line day to day and month to month. Sad but true. And then at the top of the pyramid are a handful of sociopathic greedheads who think $10 billion isn't enough...if they just had $11 billion then maybe they'd finally be happy...

When money was created man stopped worrying about each other and most began to care only about themselves.

In the system as currently construed, if you don't worry about yourself nobody else will, so you will starve. You need a sea change in human consciousness to get people to think of their fellow man before themselves. Sadly, whenever this has been attempted, it usually goes awry for any number of reasons: Freeloders take advantage of the idealists, or bloody repression and a police state is needed to make everyone "cooperate," or everyone has a different idea of what the common good is, or...

If these countries were to come to an agreement like this and a very thought out plan that would involve lots of pros and cons for both the common person and "the man" were created I think it would be an awesome start in reuniting the public and reminding everyone that a little teamwork benefits us all even if life is different for a bit.

If the world had a population of five or six people, you might be able to sit in a circle, hold hands, and sing "Kum Ba Yah". But we have 6.5 billion, most of whom are desperately poor and must grab what they can just to survive day to day. Good luck forging any kind of consensus. Why, just take a look at ATS...can you imagine any kind of consensus on how to run the world emerging from this virtual community? And this is only a fraction of a fraction of a fraction of a percent of the global population.

Sorry to be such a downer, but we humans are, in my humble opinion, a rather ugly group of savage carnivorous apes who grab as much as they can when they can and crawl over each other's corpses to reach the shiny brass ring on a daily basis.



[edit on 2/14/10 by silent thunder]

Silent Thunder, that is one of the most briliant respones I have read. star for you.

My short take on it is...banking companies makes boat-loads of money whenever the markets move. It does matter if it goes up or down, if its the bond market or the equity market or the real estate market. Banks broker the deal and get paid, then those same banks place bets on those deals. Now there are laws that are suppose to prevent sharing of information between the deal making side and the gambleing side of the bank, but we have all seen how effective the SEC and FINRA are. Not to mention the banks influence in the media. The Greek economy has been in the crapper forever and the EU knew it a year ago, but all of a sudden its a huge problem in the US equity market.



After Goldman Sachs has purchased short position the Greek bonds and long positions in German bonds. Now it makes sense. I don't think its about money anymore, I think its about power.

reply to post by silent thunder


Prior to this post I understood all of these harsh realities. I wanted to see if anyone else had ever thought of this. It bugs me that we invented and we print money and everyone owes it to someone.