|
PureBytes Links
Trading Reference Links
|
Dan, the way I see it is this:
The number of shares in a company/index does not change significantly
(discounting share splits and share options), OK; the share price/index
value does change. For every buyer there has to be a seller, right.
>If the stock market drops, who wins??
>
Those who sold at the top.<g>
>Similarly, if Italian interest rates go up relative to US interest
>rates, who wins?
Wouldn't this be the banks and money lenders who use variable interest
rates?
The real problem is when the wealthy people who put these trades on fail to
pay out when they lose. Hence Greenspan's attempt to persuade LTCM to honour
its commitments.
RPP
-----Original Message-----
From: TheGonch <Daniel.Goncharoff@xxxxxxxxxxxxxxxxxxxx>
To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
Date: 03 October 1998 11:53
Subject: Re: Long Term Capital Management
>Richard Parsons wrote:
>>
>> Forgive me if I'm missing something here but isn't one traders loss
>> another's gain?
>>
>I am no expert, but a couple of thoughts come to mind quickly:
>
>If the stock market drops, who wins??
>
>Similarly, if Italian interest rates go up relative to US interest
>rates, who wins?
>
>It seems to me that both a falling stock market and rising interest
>rates both eliminate wealth. Together they can eliminate a lot of
>wealth.
>
>JMO
>
>Dan Goncharoff
|