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Yup, just ask Bernie Ebbers. $300million margin call wasn't it? The
Japanese had limitless real estate wealth in the late 80s but could
not sell because of high tax rates. They leveraged their assumed
wealth until all the dominoes fell.
Wealth does evaporate without transfer. A stock does not have to
change hands to go lower. No bids = lower price. Everyone owns it
at $100. Next morning its at $10. The only winners are the corp
issuer which in the case of tech burned up the cash pursuing
profitless dreams and the fed gov't which taxes you on your worthless
unexercised stock options.
--- In realtraders@xxxx, "Ray Raffurty" <r.raffurty@xxxx> wrote:
> Wrong, wrong, wrong, wrong, wrong, wrong, wrong, wrong, wrong,
wrong, wrong, wrong, wrong, wrong, wrong, wrong, wrong, wrong, wrong,
wrong, wrong, wrong, wrong, wrong, wrong. If you believe this, STOP
INVESTING/TRADING NOW. You are in great danger.
>
> You are only "wealthy" on paper. You have NO wealth until you take
profits. A bank will gladly loan you money on 50% of your paper
wealth, then sell 100% of the position (or whatever % is required to
make THEM nor you whole if the stock drops below 40%) at any cost to
you.
>
> Good luck (you'll need it) and good trading.
>
> Ray Raffurty
>
>
> ----- Original Message -----
> From: Steve Walker
> To: realtraders@xxxx
> Sent: Thursday, August 01, 2002 11:34 AM
> Subject: Re: [RT] bear market stats
>
>
> Wealth does disappear to the extent the market moves higher after
the
> purchase and then retreats.
>
> >>> r.raffurty@xxxx 08/01/02 10:30AM >>>
> Recently the Democrats have been harping on the 7.7 trillion loss
in
> market cap. This shows a total lack of understanding on how
markets
> work.
>
> If a person is stupid enough to by stock in Dr. Coop.com (fill in
your
> favorite dead stock) at $80 they deserve to drive a Dodge Omni
with
> 100,000 miles (they probably paid 2995.00 for that too).
>
> The point is that the 7.7 trillion dollars did not disappear, it
just
> changed hands. The uninformed and greedy sucker ALWAYS gets
clipped.
> CNBC just ran a report about a couple that lost 75% of their
account in
> JDSU. Their kid wants to go to Duke University, so they are
moving,
> riding the subway, etc. He was man enough to admit it was his
fault,
> but fell short of admitting it was GREED, pure and simple, that
made him
> buy an over priced stock and IGNORANCE that prevented him from
> protecting his position with options or even stops. The person
(s) who
> sold him JDSU at the top are driving the Porsche because they
recognized
> that the market could not go parabolic for long.
>
> If there is a case of fraud, a stock holder would have a
legitimate
> complaint and new laws may address some of this by returning ill
gotten
> grains to investors (if the feds can find the assets). However
in most
> cases this is not applicable. The vast majority of losses are
caused by
> GREED coupled with IGNORANCE. Now the great masses are crying to
their
> congress man "They never told me I could lose".
>
> Good luck and good trading,
>
> Ray Raffurty
>
> ----- Original Message -----
> From: SLAWEKP@xxxx
> To: REALTRADERS@xxxx
> Sent: Thursday, August 01, 2002 6:03 AM
> Subject: [RT] bear market stats
>
>
>
>
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