Contribution

[Jesse Livermore]

Hi people,


This question is short and simple, how does financial trading contribute to society?

Jesse Livermore

 

[It's Snake Pliskin]

Jesse,

It provides people with the means to make money and provide for themselves and their families.

 

[Kauri]

And some people may be more interested in finding out how society can contribute to their financial trading.

 

[Jesse Livermore]

Jesse,

It provides people with the means to make money and provide for themselves and their families.

Hi tina,

I am asking how goes financal trading contribute to society at large, assumming you do it for a living. Traders are not providing a good or service to anyone. I need to know how does me trading benefit society at large? I feel if you are to be successful and fulfilled you need to know what you are doing is in some way is contributing to society. I would like reinforce I am talking about how trading for a living contributes.

Jesse Livermore

 

[It's Snake Pliskin]

Hi tina,

I am asking how goes financal trading contribute to society at large, assumming you do it for a living. Traders are not providing a good or service to anyone. I need to know how does me trading benefit society at large? I feel if you are to be successful and fulfilled you need to know what you are doing is in some way is contributing to society. I would like reinforce I am talking about how trading for a living contributes.

Jesse Livermore

I'll spell it out to you then. The flow on effect. You make money and then spend it on goods and services. The people who recieve your money then can spend it and on and on.

 

[wayneL]

This is a common question, and critisism, of trading for a living...that it does nothing to contribute to society. I've even discussed this topic with someone who thought it evil...because (in this persons faulty logic) a winning trader must profit at the expense a losing one.

The same, and worse accusations, can be levelled at any number of industries e.g. gambling, cigarettes, booze, etc etc.

I've even seen it written that it is evil to be a landlord! Sheesh!

However, it is an irrelevancy. There is no moral or ethical contract that our vocation must "contribute to society". An individual may contribute to society in many other ways, other than in their method of making money.

Add to this Tina's point about the flow on effect, and the argument further loses strength.

Worry not! Trading is not a sin!

Cheers

 

[WaySolid]

People who trade futures such as myself (small traders/speculators) provide nescessary liquidity in a very important institution for our society.

Futures markets are vital in our economic system. This is very very much different to a casino or anything related to gambling.

My motivation is that I love the challenge of trading and it pays my wage but it also serves some purpose as well.

And it's only a sin when I lose money Wayne

 

[wayneL]

And it's only a sin when I lose money Wayne

I hear you!! LOL

 

[tech/a]

Without it you wouldnt have a way for companies to finance expansion.
Increase employement oportunities--develope new technology---make available new improved product and export it to the world.

Without it the infrastructure of the modern world would cease to exist.

I'd say that it has a fair contribution to life as we know it!

 

[wayneL]

Without it you wouldnt have a way for companies to finance expansion.
Increase employement oportunities--develope new technology---make available new improved product and export it to the world.

Without it the infrastructure of the modern world would cease to exist.

I'd say that it has a fair contribution to life as we know it!

Tech,

That is only applicable if buying a float or share issue.

Trading existing shares/futures/options on exchanges don't add one iota of capital to the company.

But certainly the stockmarket does facilitate this when new shares are issued...which wouldn't be so attractive to the buyer, unless they could turn around and flog them on the exchange...so indirectly, yes.

 

[tech/a]

More comments from the "X" files.

Couldnt resist Wayne!

 

[mit]

The biggest thing that traders as opposed to investors add is liquidity which keeps the market orderly. The bid/ask spreads would be huge if there weren't traders in the market.

MIT

 

[Smurf1976]

Generally agreed with the comments of others but don't forget that it is ultimately productive industry that is the basis of wealth creation. So no problem with traders but I do have a bit of an issue with those who always find some reason to oppose any kind of productive industry whilst claiming that service industries and speculation offer a complete alternative when in reality they do not.

It is the farms, mines, mills, smelters and factories that are largely responsible for the wealth of this country and its people. So I'm quite happy to support their continued existance. It's not the direct employment that is an issue, but the enormous flow on effects of such activities that benefit everyone from chefs to engineers and nurses.

 

[wayneL]

More comments from the "X" files.

Couldnt resist Wayne!

Hahaha Love it!

 

[AnUbIs]

One could say that making money in this way contributes, by keeps the welfare bill lower. (less people looking at the government for a hand out)

But believing the flow on effect is real is too simplistic. Because you made money by trading which came from some of those people you hope the money will flow too.

So believing you are supplying a service by trading is really out there as a theory!!!

But don't get me wrong, I’m a capitalist that means capitalizing on others, painting over this makes some of you sleep better at night doesn’t it!!!

 

[It's Snake Pliskin]

One could say that making money in this way contributes, by keeps the welfare bill lower. (less people looking at the government for a hand out)

But believing the flow on effect is real is too simplistic. Because you made money by trading which came from some of those people you hope the money will flow too.

So believing you are supplying a service by trading is really out there as a theory!!!

But don't get me wrong, I’m a capitalist that means capitalizing on others, painting over this makes some of you sleep better at night doesn’t it!!!

Yes the flow on effect is simple to understand. I take their money and they take mine, but I keep a bit of it - hopefully a lot- and so do they. It's what keeps economies going.

Trading is not a service and is not bad. Why would trading be bad? Because it beats working for slave wages? Or it is not the normal thing to do, because you know and others don't? I'm all for vocations that make you money by simply thinking and making decisions.

Capitalism is all about exploitation. The exploitation of resources. So if you have a moral conscience and find capitalism bad, don't look at Lenin or Mao, because it's the same only you don't own anything and you are a comrade exploiting resources for your motherland.

 

[AnUbIs]

Yes the flow on effect is simple to understand. I take their money and they take mine, but I keep a bit of it - hopefully a lot- and so do they. It's what keeps economies going.

Trading is not a service and is not bad. Why would trading be bad? Because it beats working for slave wages? Or it is not the normal thing to do, because you know and others don't? I'm all for vocations that make you money by simply thinking and making decisions.

Capitalism is all about exploitation. The exploitation of resources. So if you have a moral conscience and find capitalism bad, don't look at Lenin or Mao, because it's the same only you don't own anything and you are a comrade exploiting resources for your motherland.

You wrote a lot, but I can't really see what you meant?

You might want to think about becoming a Politician, you seem to have the gift!!!!

Capitalism means capitalizing in my dictionary!! Do you have a different meaning in yours?

 

[rembrandt]

Hi Jesse ... IMHO financial markets exist to transfer funds from savings-surplus units to savings-deficit units which then invest in productive assets and thereby add to the wealth of society.

As a savings-surplus unit my only ethic is that the wealth of society should benefit ... this by nature is as loose a definition of an ethic as you can get but there we are. Individuals may refine their interpretation of ethic and may for instance, refrain from investing in say tobacco/asbestos companies.

The worlds equity markets depend on 'stock exchanges' which have many responsibilities that relate to 'market efficiency' if they are to gain and keep our TRUST. Others have mentioned 'liquidity' and it is worth noting that generally, around 95% of company scrip is generally not traded but held passively as long term investment.

The remaining 5% that is actively traded serves the important stock-market function of pricing stock instantly and accurately thereby allowing funds to move from inefficient/high risk firms to more efficient/low risk firms.

From time to time, surplus wealth will transfer from the financial markets back into society increasing demand for goods/services.


Cheers ...

 

[It's Snake Pliskin]

You wrote a lot, but I can't really see what you meant?

You might want to think about becoming a Politician, you seem to have the gift!!!!

Capitalism means capitalizing in my dictionary!! Do you have a different meaning in yours?

Well well, no need to be nasty about it.

Maybe this should be my last post.

 

[Julia]

Maybe this should be my last post.

Tina,

No, it shouldn't be your last post. I, for one, have found considerable value in your posts.

To those "anti-trading" people: if we take Bill Smith as an example. If Bill manages to earn enough by his trading on the stock exchange to keep himself, and he has no other apparent talents or skills, and therefore finds it difficult to hold a more "ordinary" job, then by earning a living by the only means he finds possible, then he is benefiting society by not being a drain on the welfare system, i.e. his fellow taxpayer.
I just don't see why anyone needs to be so morally outraged by any one who earns or supplements their living by trading in legitimate companies, most of which produce products which in some way or another benefit the society in which we live. The moral high ground can become pretty mushy at times.

Julia