Forum Archive Index - December 2000

[Marilyn Munroe <who.c@res.co.nz>]

The function of a stock exchange is to efficiently allocate capital.

It acts as an intermediary between those who have cash stuffed in their mattresses and those that need cash to establish or expand some economic activity with the aim of making a profit.

The N Z Stock exchange is an institution on its knees because those with cash in their mattresses no longer trust it to efficiently allocate capital in a manner that profits investors.

If it cannot do that function it should be sold off to the knackers, like a broken down old horse.

We need an institution that allocates capital efficiently, fairly, and protects investors from snake oil salesmen.

Investors have to ask themselves whether they believe that the N Z Stock Exchange can do this function.

The challenge is to devise something to take its place.

Boop-boop-de-do Marilyn

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