Frances
On Wed, 12 Aug 1998, Doug Henwood wrote:
> Shelvers at aol.com wrote:
>
> >reassurance machinery? What would one normally see?
>
> Pundits on TV assuring us that this is a short-term correction and people
> in it for the long term, etc. News clips of heroic small investors writing
> buy orders - or, today, clicking buy orders. What would Keynes:
>
> "The spectacle of modern investment markets has sometimes moved me towards
> the conclusion that to make the purchase of an investment permanent and
> indissoluble, like marriage, except by reason of death or other grave
> cause, might be a useful remedy for our contemporary evils. For this would
> force the investor to direct his mind to the long-term prospects and to
> those only. But a little consideration of this expedient brings us up
> against a dilemma, and shows us how the liquidity of investment markets
> often facilitates, though it sometimes impedes, the course of new
> investment. For the fact that each individual investor flatters himself
> that his commitment is "liquid" (though this cannot be true for all
> investors collectively) calms his nerves and makes him much more willing to
> run a risk. If individual purchases of investments were rendered illiquid,
> this might seriously impede new investment, so long as alternative ways in
> which to hold his savings are available to the individual. This is the
> dilemma. So long as it is open to the individual to employ his, wealth in
> hoarding or lending money, the alternative of purchasing actual capital
> assets cannot be rendered sufficiently attractive (especially to the man
> who does not manage the capital assets and knows very little about them),
> except by organising markets wherein these assets can be easily realised
> for money."
>
> have made of day trading on the web?
>
> Of course a contrarian would see the Economist's bear cover as a buy signal.
>
> Doug
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