[NEWS]Iceland

[user]

Jim decides to buy out company A for 10$ a share.

Jim has all of a company's stock.

Jim's stock is dropping, and he is trying to sell his stock before it's too late. He sells at 6$ a share.

I buy all of his stock thinking that the company will turn around.

It continues to decline and the company goes bankrupt.

The only interaction of money was between me and Jim. Nobody won money, everyone lost.


The law of conservation of mass has NOTHING to do with economics.

K, here is my question to you? Value of stock decreased from $10 to 6, someone somewhere gained 4 dolalrs. You bought it at 6 and the company flipped, where is the 6 dollars gone to now?

[Barotix]

The money is gone since dealing in the stock market is purely speculative and you don't have the money on hand at that time; that's why it's called an investment. The market is run by simple investments that involve risk and reward. In a high risk venture all participants risk massive losses. In the case where stock is continually plummeting neither investor gains. In other words; people don't gain from other people's losses in a speculative market where the money isn't even tangible yet. This, of course, assumes the market is free and unhampered, which it isn't. =]

tl;dr: The 6 dollars is A]Gone, or B]redirected to productive long(short)-term investments and(or) sound institutions.

[marjin_boo]

Rule of thumb in most 3rd world country, when you have a lot of money invest in asset, mainly property. If it falls, you still can use it. Also you can buy diamond or gold, the price never drop. Doesn't apply to everyone but, hey it helps in this kind of shit economic crisis.

[Reise]

Rule of thumb in most 3rd world country, when you have a lot of money invest in asset, mainly property. If it falls, you still can use it. Also you can buy diamond or gold, the price never drop. Doesn't apply to everyone but, hey it helps in this kind of shit economic crisis.

No, you invest in guns, then you take what you want by force.

They've been doing that in Africa for years now.