Your Questions About Stock Market Is A Ponzi Scheme

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Chris asks…

how can we help the stock market?

what can we do to make it better?

Justin answers:

The market is and was doing find until Congress wanted to “regulate” it, so how can “WE” (whoever that is) regulate it

The market can and has regulated itself for years until outsiders who know nothing about the markets tried to regulate it.

The banks were separated and prohibited from being active in the markets until Congress decided to regulate the markets by letting banks participate.

The amount of liabilities a brokerage firm could have was change Congress decided to regulate it a raised the amount a firm could borrow

There were undesirables in the market, at one time you could report them and have them put out of business, not now, their actions are ” regulated” and other broker/dealers or individuals can not properly bring actions against such people.

The government is incapable of regulating anything and have proven it time and time again. One of the easiest schemes to pickup on is a ponzi scheme, yet the Government didn’t catch it after 8 years.

The government is worried about insider trading, but they can do it.

Help the stock market by getting the politican, the do gooders, and the unknowing out of the market.

Richard asks…

Why if the USA is having drastic economical problems the us currency is costing more,shouldnt be the other way?

Justin answers:

Due to the deadbeats, both corporate and personal, in America, the rest of the world foolishly invested in our bad mortgages and ponzi schemes.

So, our foreclosures are costing the world 5-15 times the investing dollars.

The Federal Reserve has been printing fake money for months and flooding it into the World’s economies to try and keep this very thing from happening. Didn’t work to well.

BUT, because the foreign countries/investors are being given free money by the US, it is creating a small bubble of value. Gives the foreigners more bang for the buck–and it is all play money.

In the next few months, the value of the dollar is going to plummet.

Since, we idiots let our government throw open our borders to “free” trade, we now get nearly 50% of our FOOD from foreign countries and nearly 70% of our pharmaceuticals and OTC medicines.

When the dollar dumps, and it will, the goods we need to survive may become too expensive for any of us.

We can help hedge this off, for ourselves. Instead of taking the loss from the market and yanking our money, we should be planning for huge spikes in food prices. Conserve, re-use, recycle. Quit spending on credit. Start stocking up on basic necessities like toilet paper and rice.

Some of us will be prepared and be ok. The vast majority are not.

It is going to get really ugly here fast. While people are decimating their future retirements and ignoring the reality, a growing problem is going to rear it’s ugly head.

My family will eat, at least for a while, will yours?

William asks…

Can your experience show you anything other than a country set to destroy it’s citizens?

by either sending them to war, feeding them diseased and unfit foods (the FDA is regulated by the government and so much is allowed through that is in violation of certain standards), causing genetic defects through various forms of pollution & communication devices, using media to display unhealthy, violnet, immoral ways of living (underage -by their own laws- pregnancies, infidelity, murders, etc.etc.)

Justin answers:

Well, first they want to take all of your money with ponzi bank and stock market schemes like the sub prime fiasco and the Bear Stearns bailout. Then there is driving down the value of the US dollar while Cheney and Bush have their money in euros. Yes, it’s all good under the Republican banner. Greed, greed and more greed. Cheney says, “American citizens, f@#$ yourselves!”

Daniel asks…

Should Social Security convert to a program of individual retirement accounts? Why or why not?

Justin answers:

The economic answer is yes, Social Security is really nothing more than a legal Ponzi scheme with those currently working paying in and the retired getting benefits. In theory it works if the number of workers is large in relation to the number getting benefits. As people live longer and the population does not grow very fast (fewer workers per retiree) the plan breaks down.

There is no SS Trust Fund (an account with with your name on in inside the government) , the government gets the money, spends it and puts an IOU in the pot. Right now more money comes in from workers than goes out to retirees, but that will reverse somewhere around 2015 give or take 3-4 years. Then how to the retirees get paid? By raising SS taxes, cutting benefits, or borrowing more money from the Arabs and or China.

Politically, only going deeper in debt will fly. Deficit spending by both government and individuals is what has brought about the economic slowdown we are in today. We will get out of this slowdown, but only by pushing out the problem to a later date.

Historically, the stock market has returned just under 8% per year adjusted for inflation(therefore you buying power doubles about every 9 years), while the payback for SS is less than 2%.

The reality is we can’t afford the transition, so it won’t happen. I am 62 and decided at 30 I could not count on SS so i cut my lifestyle invested well an a comfortable today.

Charles asks…

Since the market is so low, would now be a good time to invest in the stock market.?

What would be good area to invest. Thank you very much.

Justin answers:

LOW?

The dow is almost 8,000!!! It was 6,500 a couple weeks ago and we have a long way to go before we hit 2,000!

Have you seen that our 50 day, 200 day, 500 day and 1000 day moving average is all declining! Do you really think the market is low when this is the case?

SHORT THIS MARKET! This casino game we call the stock market is nothing more than a ponzi scheme and based on the 2012 shift in consciousness the Mayan Calendar talks about (and they have been right 100% as of now, so why are they going to be wrong tommorow?)

We have a long way to go before we reach 2,000 DOW as with almost 20% unemployment (Shadowstats.com) and a fiat currency on the verge of collapse, you think stocks are the way to go (LOL). I hope you do not trust CNBC for they lie to us, and always have for the government controls the media and the government always lies to us also.

Did you not see what VISIONVICTORY and MANOFTRUTH have been saying on Youtube? These guys know what they are talking about and here to help us.

However, if you wanted to invest in the casino stock market, the best code right now I think is SKF or FAZ which is a short fund on the financial markets which is for XLF to go down in price which it should.

Peace

George asks…

Why aren’t the US people starting a revolution?

don’t they know the fed are using the peoples money to keep the stock market going

Justin answers:

It has not affected enough people severely enough yet but just wait until August of this year. People will have no choice but to fight for food or die. I can’t believe i’m even writing this but it is the sad truth, the ponzi scheme of digital bailouts can only do so much before the system completely collapses. Experts predict that it will be the youth that will revolt because they are united through the internet. However, this will be followed by martial rule. The deciding factor will be if those performing the martial rule decide to follow through with it or also revolt. Mark my words “there is a great war coming in fall of 2011”. A few things to keep in mind until then…austerity, FEMA camps, hyperinflation

Ken asks…

Have currency traders concluded that Chinese communists better capitalists than Americans?

The US government credit rating is sinking. When will Americans realize that capitalism is about producing products that people will buy rather than Wall St Ponzi schemes. The Chinese are winning the capitalism game and are preparing to dictate terms to Washington.
http://ca.news.finance.yahoo.com/s/10112010/24/f-afp-china-rating-house-downgrades-credit-rating.html

Justin answers:

Which Americans?
Corporations, who make money by sending jobs to China?
Politicians who have to promise tax cuts in order to get elected?
Voters who think that tax cuts really are free and the deficits that they create can be taken care of by declaring bankruptcy or something?
People in poor areas who are just making ends meet and honestly cannot afford to buy products made in America?
Safeway workers, who go to Costco to buy their groceries? (really)

That said, currency traders are playing Russian roulette when they trade in Chinese currency.
China determines the exchange rate.
When you go into China, you have to trade dollars for yuan.
And you cannot trade back again when you come out.
At least that’s how it was several years ago, and I have no reason to think it’s changed.

When you set up a market system that rewards corporations for cutting jobs,
and you have a populace that thinks buying stuff made somewhere else won’t have a negative effect on the economy,
and you have media that tells people to vote against their own best interest,
and you have voters who are unable to see that they’re being lied to,
and you have states balancing their budgets by taking money away from schools rather than raising taxes,
this is what you get.

Maybe you saw that forbes listed hu jintao rather than Obama as the most powerful person in the world.
That is the way things are going, and i rather suspect that when things start heading south, it will be astoundingly fast.
It may well be that you really do not want to have money in US denominated stocks or bonds, or anything,
and maybe living outside the US isn’t a bad idea either.

OH, and have a nice day. 🙂

Michael asks…

Can somebody tell me about http://www.imonet.biz that how real and reliable this investment firm is?

I want to make some investments with www.imonet.biz and they claim to be the part of international online investments monetary for funds and I found them right till now and they never cheated me but I am still want to get other people views about this firm registered in Belize.

Regards,

Rosewood.

Justin answers:

I can’t say for sure, but anyone that says they can make you 1.6 – 2.5% a day, is likely running a scam, or a ponzi scheme. Banks pay 3 – 5% a year, and the stock market averages 8 – 12% a year.

The fact that it is out of Belize would also give me pause. Since when did Belize become a ‘hot bed’ of investments?? If it sounds too good to be true, it probably is.

Steven asks…

How is the stock market not like a Ponzi scheme?

A serious question.

After all, when investors put in money into the market, stock prices go up. However when investors sell and take money out, stock prices go down. Ultimately if everyone sells, the market loses trillions in value and the stockholders who are left end up with nothing or at least far less than they had.

How is this any different than a Ponzi scheme where investors who take their gains early on benefit while later investors who do not end up with nothing? It just seems to be the only difference is simply the scale and duration of the operation.
Do shareholders really get anything tangible? After all, if a corporation goes bankrupt, common shareholders get wiped out.

Justin answers:

Nice,
I agree with Mr Not Commie that an “investor” is investing in a company which is expected to use your money to produce profits. The company then is creating wealth. So there is more more money, value, in existence because of their operation as a result in doing business.

Second, in a Ponzi scheme there is a fraud involved because they are claiming the early payments are a result of doing business, like a company, and that is not true at all.

– In a small sense you are right that speculating in short term movements of stocks, trading, is essentially a zero sum game where the gains made by some are the losses by others. But even during the time those shares are being traded the underlying companies are usually making profits.

– Trading does has a benefit, a purpose, in that it provides liquidity and a market for investors that want to buy or sell stocks.

An investor looks at the ability of a company to produce profits and that company is competing against other companies in their efforts to do that.

A speculator is competing against other traders and making guesses on the other traders evaluation of a company and is making a determination, a guess, whether they think the other traders are right or wrong.

The distinction between speculating in stocks and investing is a crucial one you need to keep in mind in how you allocate your money.

But I will say the market in last couple of decades has seen too much boom and bust and that “buy and hold” investing is not as valid as it once was as even major companies have become too focused on short term results.

– So If you want to be a “long term investor” I am of the opinion you still must pay attention to the times when the market gets out of balance on either the up or down side and adjust accordingly by doing “some” trading.

As to “tangible benefits” that is one reason dividends are so good at mitigating that risk. Once they pay you that money it is yours and in your pocket.

I believe that investing and speculating is all about managing risk much more than simply always trying to maximise return.

Good Luck.

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