The Incredible Lies We Are Told About Wall Street

[xchrom]

http://www.alternet.org/corporate-accountability-and-workplace/incredible-lies-we-are-told-about-wall-street

Fewer than half of the US population owns a single share of stock and even fewer Americans are in a position to start their own businesses. Nonetheless, at least in rhetoric this nation remains the land of the self-made man — and occasional woman. Many believe they still have the opportunity to be real entrepreneurs — by investing in corporate America through the stock market.

Stock markets provide all our citizens the chance to invest in those companies with promising products and technologies. Companies use capital from the markets and loans from banks to expand plants and innovate. Banks also act as an instrument to screen and evaluate new business opportunities. All of these contentions would hardly survive the usual scrutiny the media give to most economic matters, especially government programs. Why these myths persist is a vital political question.

The stock market today seldom raises capital for real investment. Our economy has become increasingly financialized with speculative activity generating a large share of total profits and also steering — and disrupting — the course of the productive economy.

Consider first what happens when I purchase a share of stock on the New York Stock Exchange. If I buy a share of GE stock, am I in effect loaning funds to GE, which it may then use to expand its productive facilities? No. I am buying this share from another market participant. GE sees none of this money. The only circumstance in which stock purchases lead to productive activity is corporate issuance of Initial Public Offerings, IPOs.

[KG]

1. wall st = lie factory

[Depaysement]

2. It ancient times - half a century ago - there was a word for this

Gambling

[dixiegrrrrl]

3. There are 2 people in Congress who are pointing out the fraud.

Elizabeth Warren
and..
Rand Paul.

[seveneyes]

4. The truth is hidden in plain sight

Vestation exists only in those that hold an interest in their observations at hand. Escape from the misery is assured without promise of pleasantries along the way.

[Tierra_y_Libertad]

5. Isn't that the place that where the people who talk about "Takers not makers" hang out?