Entries Tagged 'Economics and Investing' ↓
June 30th, 2010 — Investing
Money, as Karl Marx spent thousands of pages in his book titled Grundrisse trying to convince us, is not a “thing.” In modern economics this idea is expressed more succinctly. Money, we are told, is “a medium of exchange.” But an exchange of what for what?
Even though they say money is about exchange, economists usually talk about things in connection with it. “You sell me one thing. I give you money. You take my money and buy another thing. That person takes your money and buys more things, etc.”
Marx’s view of money as an medium of exchange was quite a bit more profound. Marx viewed money as a “social compact.” When the society that created and agreed to use a certain kind of money no longer functioned, neither did its money.
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June 17th, 2010 — Investing
- “Now I don’t know who to trust and I don’t know what I can believe. They say they want to help me but with the stuff they keep on sayin’. I think those guys just wanna keep on playin’ [“Roulette”] (Springsteen)
“Risk” is a word you hear a lot if you invest. Ever stop and wonder why that is?
Risk is key to broker success. Large investment brokers have found ways to transfer risk onto the shoulders of their clients without their client’s knowledge. Some do it for commissions. Some do it so they can profit off their client’s ignorance.
Smaller investment brokers use risk as a way to milk clients for money too.
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June 1st, 2010 — Investing
(part 3 of 3)
Risks of Investing
If you’ve ever bought a mutual fund and read its prospectus, you’ve probably seen the section where the prospectus highlights all the kinds of risks attached to that kind of fund. Unfortunately “disclosures” of risks from the financial community are much like disclosures of side effects of prescription drugs in TV commercials for those drugs. There are so many you just tune all of them out.
Is risk a four letter word? No! It’s not a bad thing if you want to live life to the fullest. But only a fool jumps off a cliff without knowing if there are rocks under the surface of the water below.
This blog series aims to reveal the chief risks of ETF’s.
Risks of derivatives in general and ETFs in particular
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