Skip to main content

View Diary: Why what Ben Bernanke said yesterday should make you angry (102 comments)

Comment Preferences

  •  ot/but I have a question for any finanseers? (1+ / 0-)
    Recommended by:
    Pluto

    1.  It seems to me that pension funds are a significant part of the investor community.

    2.  Which would make it highly advantageous for the street to have an affluent middle class.

    3.  However, it did occur to me that you could say that as wealth is being distributed, there is the same amount of capital available to invest, but a smaller investment number of investors.  So maybe it doesn't matter?

    4. Or maybe it does?   Is it in the street's interest to have a larger number of investors with wealth more widely spread out?  Does that make for higher employment with a larger number of brokers and houses?

    Thinking this through/value any input?

    •  Just push it out to the extreme (0+ / 0-)

      ...to analyze the scenarios.

      If only ten individuals held all the investing wealth in the US, the markets would grow if they invested it there -- and the fundamentals of the company's (earnings ratio) were ignored.

      These ten individuals would be making all of their money from investing money. Not from creating jobs. Jobs are not needed because the consumer class is too poor to buy much and create demand.

      That's pretty much where we are now.

      _____

      If 100 million individuals held all the investing wealth in the US, the markets would also grow if they invested it there. This time there is no need to ignore the fundamentals of the companys, since everyone would also be a consumer -- so demand would be very high.

      These 100 million individuals could NOT be making all their money from investing. They would also have jobs to supplement the income from their investments. Companies would be creating jobs like mad -- because of the intense demands from this wide and deep American consumer/investor class.

      That's pretty much where we were before 1980.


      "People who are forgetful have no future." — Chen Guangcheng, blind human rights activist who escaped house arrest and sought refuge in the U.S.

      by Pluto on Fri Jun 08, 2012 at 12:50:45 PM PDT

      [ Parent ]

      •  thanks, but still not clear (0+ / 0-)

        I was originally trying to make a case that it is to the wise boy's advantage to have an affluent middle class...with pensions, etc...

        From what I could tell, you are claiming that a large investor class should result in more effective and rewarding investments as brokers would not need to ignore a company's fundamntals as much?

        And, again, is it to the street's advantage to have a large number of investors because there would also be more brokers, more support staff?

        thanks/sh (not too well, so sorry if I didn't completely understand)

        •  Heh. (0+ / 0-)

          The fault is all mine. The middle class in America WAS the investor class, until just recently.

          Truth.


          "People who are forgetful have no future." — Chen Guangcheng, blind human rights activist who escaped house arrest and sought refuge in the U.S.

          by Pluto on Fri Jun 08, 2012 at 09:49:06 PM PDT

          [ Parent ]

Subscribe or Donate to support Daily Kos.

  • Recommended (150)
  • Community (71)
  • Baltimore (68)
  • Bernie Sanders (49)
  • Civil Rights (38)
  • Freddie Gray (38)
  • Elections (28)
  • Hillary Clinton (27)
  • Culture (24)
  • Racism (23)
  • Education (20)
  • Labor (20)
  • Rescued (19)
  • Media (19)
  • Economy (19)
  • Law (19)
  • Science (16)
  • Politics (15)
  • 2016 (15)
  • Barack Obama (14)
  • Click here for the mobile view of the site