Forum Archive Index - April 2001

["Timothy Field" <novvis@paradise.net.nz>]

My 2c:

Surely *at any instant* the sharemarket is a zero-sum game?  The total
individual gain is equal to the total individual loss.  However, as
investment in the economy actually creates wealth (as you said), in the
long-run the equity markets are not zero-sum.

So, as traders, it is correct to view the markets as a 'win/lose' game;  as
investors it would be fair to say that an increase in publicly available
information leads to an adjustment in expectations promoting better
allocation of resources -- a 'win/win' situation in the long-run.


Cheers,
Tim.

-----Original Message-----
From: owner-sharechat@sharechat.co.nz
[mailto:owner-sharechat@sharechat.co.nz]On Behalf Of Mark Hubbard
Sent: Monday, 23 April 2001 10:07 a.m.
To: sharechat@sharechat.co.nz
Subject: Re: [sharechat] Dissecting the postings.


Just a couple of quick comments Mike.

Regarding the 'game' metaphor, I guess its valid for you to call the
sharemarket a game, if that is the way you view it. In the same way, some
might view life itself as a 'game'. Its just a personal point of view.

The one point, however, I would like to correct :) is that capitalism and
free markets are not necessarily the 'win/lose' game you seem to assume.
Rather, in a true free market, unregulated (so I admit we are no where close
to that), a transaction, indeed, most transactions, will be 'win/win'. The
process is simply two informed individuals coming together to trade value
for value to then achieve their own individual ends.

And now back to work ...


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