Are traders a waste of space?

[Mr J]

Drug dealing, arms trading, David Tweed's share trading, offers, Peter Foster's slimming tea, trading property debenture "investments",

Sure drug dealing is generally illegal (except alcohol of course), but are all of the above really creating a "benefit to the country and society"

Our economy is a service-based economy. Most of these are things we could do ourselves, but these days we choose to pay someone else to do it. In that respect, trading is no different - liquidity for a fee. If trading is not seen as beneficial, then consistency would require the same opinion of most jobs. In this perspective, the only jobs that really provide a service are the ones we can't learn to do ourselves (ones that require deep and focused education).

Another point of view is that trading has been around since early society, so it is obviously a necessary service. Very few jobs can claim to be have played as significant a role in society.

Wayne's post is spot on.

 

[Wysiwyg]

Another point of view is that trading has been around since early society, so it is obviously a necessary service. Very few jobs can claim to be have played as significant a role in society.

Right there answers the question. Case dismissed.

 

[It's Snake Pliskin]

Drug dealing, arms trading, David Tweed's share trading, offers, Peter Foster's slimming tea, trading property debenture "investments",

Sure drug dealing is generally illegal (except alcohol of course), but are all of the above really creating a "benefit to the country and society"

Let's look at the chemicals and additives etc that are in foods and cosmetics etc that so called valuable professions peddle.

 

[sinner]

Right there answers the question. Case dismissed.

I agree.

I feel like trading is the same as any other business. In the fundamental abstract sense what is the difference between a new farmer and a new trader: you undertake some of your own capital to make potential profit based on supply and demand.

There is no guarantee that your milk will be bought or your cows won't get eaten by wolves or whatever just the same as there is no guarantee that some investment bank won't move in to sell their position of whatever you just bought.

Farmers take out leverage on their capital to buy the farm, and until some profit is generated the issuer of the debt holds the majority of the position.

At the end of the day if all goes well and you avoid every roadblock you return some of the capital to the issuer of the debt, some goes to your landlord, some goes on food & clothes, etc. This is the economic result of your productivity, be that milking and slaughtering cows or sitting hunched over a screen analysing charts and news feeds.

Some small portion remains in your pocket, it goes to the bank account usually and this savings in the bank in turn allows the next farmer with $15,000 to buy a $400,000 farm or the next trader to put down $1000 on the next $40,000 trade he wants to make.

Economic productivity is economic productivity. Think of how many helpdesk/admin/HR/IT staff work at Comsec or Bell Direct? Think government business taxes, council land taxes, think super contributions, etc! This is provided by the clients of these companies i.e.: traders!


That is the way it is currently, be that good or bad. Maybe one day we will all learn to share and then traders will no longer serve the function they do now.

 

[cutz]

After just reading an article on a company called "Tibra", the long time geek in me thought cool, then i found myself thinking what waste of talent and resources on something that doesn't really do anything.

Dunno about that,

I don't know much about what they do but it appears that they may be market makers, a valuable link in the derivatives chain.

Often here when buying/selling options most of the quotes sitting in the order book are placed by market makers, imagine trying to get another retail trader to take the other side.

Actually the oz scene seems to have a lack of competition when it comes to these sort of things.

 

[nulla nulla]

Dunno about that,

I don't know much about what they do but it appears that they may be market makers, a valuable link in the derivatives chain.

Often here when buying/selling options most of the quotes sitting in the order book are placed by market makers, imagine trying to get another retail trader to take the other side.

Actually the oz scene seems to have a lack of competition when it comes to these sort of things.

I find their claims contradictory. If you are following any of the shares involved and you look at the depth screens, you will see the irregular "buys" or "asks" already in the queues. I fail to see how this is supposed to be their ability to react to "trends" in milliseconds, they are already in the queue?

 

[beerwm]

I hear your point of view....its a tad extreme

Traders themselves provide a massive amount of emloyment, so I guess you need to question whether contributing to local employment is a contribution to society...

This is such a baseless argument, might aswell pay people to dig holes in outback australia.... cause they will in turn buy food,clothes,shelter and provide employment

- the money recieved from trading is taken from elsewhere, so its a zero-sum equation.

providing liquidity... sure. but at what price?
- a successful trader is being overpaid for providing liquidity, a poor trader is being underpaid [due to their earnings $$$]

: its a service that needs to be there, but not an equitable one

but this is a trading forum, so i doubt you'll get many unbias answers to this question.

 

[gooner]

This is such a baseless argument, might aswell pay people to dig wholes in outback australia.... cause they will in turn buy food,clothes,shelter and provide employment

- the money recieved from trading is taken from elsewhere, so its a zero-sum equation.

providing liquidity... sure. but at what price?
- a successful trader is being overpaid for providing liquidity, a poor trader is being underpaid [due to their earnings $$$]

: its a service that needs to be there, but not an equitable one

but this is a trading forum, so i doubt you'll get many unbias answers to this question.

BAM. A total hole blown through the defence. Very well put, Beerwm. Love the digging holes analogy.

 

[wayneL]

This is such a baseless argument, might aswell pay people to dig holes in outback australia....

Isn't that pretty much the basis of Australia's wealth right now?

 

[theasxgorilla]

- the money recieved from trading is taken from elsewhere, so its a zero-sum equation.

The first part of that statement might be right, but it is no zero-sum game. The money might have come from someone who borrowed it and then defaulted on their loan.

 

[Trembling Hand]

Of course we are a waste of space if you compare the direct outcome of our "product" to a surgeon or one of the few good teachers but isn't 90% of positions in a services industry the same. Just a heap of middle men passing a heap of electrons from one position to another and taking a bit of the pie for payment?

Would everyone be happier if the wheat farmer made the loaf of bread from his wheat and sold it to the customer without any middlemen milling, transporting, packing, storing, distributing, baking, and then retailing. And the gold prospector refining his meager findings then producing 2 wedding rings each year then finding some soon to be married couples to sell to?

Yes that's the "fair" way to run a society/economy no middle men. I even think I remember what its called. Bronze Age!! lack of widespread specialisation.

Always refreshing to see in action the lack of Australian entrepreneurial spirit. Anyone who has been in business will know that middlemen are an important part of our efficient low cost economy.




But away from the specialisation of our current economy traders greatest use may well be a constant reminder of what freedoms and rewards, both in monetary and time freedom, are available to every man & women if they have the guts and determination to release themselves from the slavery and false sense of security of next weeks paycheck from the boss. Traders, like a sports person, artist or entertainer, if you become an expert in a specialisation that has an uncertain outcome you will be greatly rewarded. To the tune of 100s to 1000s time greater than the gutless wage slave that trades the certainty of next weeks paycheck in a perverse delay of the almost certain redundancy and lack of skill to create income without kissing someones ar$e.

Well maybe not a helpful reminder but rather a constant irratant.

 

[wayneL]

Of course we are a...

....but rather a constant irratant.

Great post TH, best one yet.

 

[Bushman]

If you cannot beat the system, profit from the system.

 

[Ageo]

Some jobs might be useless but nothing will ever be as useless then forced government.

Talk about having a dud effect on our economy.

You see even a bum trader who makes money from nothing will still spend it into our economy which doesnt change the overall money supply so in effect all we are doing is exchanging money from 1 hand to another. But when you "create" money for no reason then the game changes.

The only people that can create money is government and people who control them (not civilians). To me they are the biggest waste of space.

 

[beerwm]

The first part of that statement might be right, but it is no zero-sum game. The money might have come from someone who borrowed it and then defaulted on their loan.

...then doesnt the bank lose money? and pay less dividends to their shareholders/ or recieve a bailout from the population?


also, i guess it must be said - its also a distribution of wealth from the inable to the able, [unwise to the wise?]

-kinda like a casino

 

[shortlist]

I was just thinking that someone hadn't come up with argument for a while.

It's a boring one so won't bother to much but let's put it this way:

Society (via government) has done nothing but leech of me ever since I started working. Because of my circumstances, I don't receive value for money. When I needed support, they told me to go jump.

I support my family, I pay my taxes, I buy stuff, I pay for services, eat at restaurants, contribute to the economy in a million ways.

Aside from that, I have no desire to contribute to society... unless by volunteering. My choice. End of story.

Anybody trying to lay guilt trips on traders can just naff right off.

Two gold stars to WayneL for this post - totally agree.

 

[motorway]

...then doesnt the bank lose money? and pay less dividends to their shareholders/ or recieve a bailout from the population?


also, i guess it must be said - its also a distribution of wealth from the inable to the able, [unwise to the wise?]

-kinda like a casino

It can only be ZERO SUM IF markets are homogeneous ..

Long short POSITIONS , HEDGING , But most of all Very different TIME HORIZONS

Trader A buys on a dip off TRADER B who held for 6 weeks and is taking PROFITS.. HE then sells after holding for two days to someone Who is going short on a small BULGE.. Covers at the low for the DAY where TRADER A re-enters,...

WHAT IS IT ALL THESE TRADERS / INVESTORS want ? LIQUIDITY.

World needs more traders and more things traded.

MORE not LESS Liquidity

And That is a WIN WIN for Everybody

Leads to the cascade of PROSPERITY viz my Earlier post..


Motorway

 

[Largesse]

It can only be ZERO SUM IF markets are homogeneous ..

Long short POSITIONS , HEDGING , But most of all Very different TIME HORIZONS

Trader A buys on a dip off TRADER B who held for 6 weeks and is taking PROFITS.. HE then sells after holding for two days to someone Who is going short on a small BULGE.. Covers at the low for the DAY where TRADER A re-enters,...

WHAT IS IT ALL THESE TRADERS / INVESTORS want ? LIQUIDITY.

World needs more traders and more things traded.

MORE not LESS Liquidity

And That is a WIN WIN for Everybody

Leads to the cascade of PROSPERITY viz my Earlier post..


Motorway

People should really listen to this Motorway fellow A LOT more.
He is bang on the money with every post.

Can the moderators give this guy a special VIP poster status or something that distinguishes him from the rest of the pack?

 

[condog]

Have you ever seen a bloke banging his head on a brick wall?????

Hmmm something in here seems familiar....

 

[Aussiest]

Traders themselves provide a massive amount of emloyment

I agree with condog, so_cynical and a myriad of other posts here.

I pay tax, therefore i contribute to society. Trading also makes me happy (for the most part), so i am kinder to people. It also frees me up to do what i really want instead of remaining a bitter slave to somebody else's idea.