Yeah...but...tax cut!
And here’s the rub. All that was true at the end of the Obama administration. Throw on more stimulus and bam!
Like riding a 10 speed down a 9% grade in third gear.
Jackburton
Gone Fish'n
I know most of you don’t play in options, but a lot of traders use margin to leverage themselves to make more money. Margin is basically a line of credit with a floating rate. Your line is tied to the amount of equity in your account, stocks and cash for example.
Brokerages require anyone trading or buying options maintain a level of “maintenance” money in the account. If that level of equity falls below a threshold, the trader will get what’s called a “margin call”. This means he has to make his account whole in order to maintain his credit line that he’s using for options. If the trader doesn’t come up with cash or equity to satisfy the margin requirements, the brokerage can sell any of his positions to make the account whole without telling the trader. I hope you can see where this is going, it starts a waterfall of selling and premature closing of positions.
A lot of traders have been using margin in the last decade because rates have been so low, it’s been cheap money. The fear is when margin is more expensive where the spread is less and less, it’s harder to make money. Combine that with the above scenario, you have a full fledge meltdown in a very short time.
This is very simplistic explanation of how this can unravel very quickly. My advice to anyone that’s heavy in the market right now, tune out the noise and keep investing, unless you’re in margin, in that case may god have mercy on your soul.
Brokerages require anyone trading or buying options maintain a level of “maintenance” money in the account. If that level of equity falls below a threshold, the trader will get what’s called a “margin call”. This means he has to make his account whole in order to maintain his credit line that he’s using for options. If the trader doesn’t come up with cash or equity to satisfy the margin requirements, the brokerage can sell any of his positions to make the account whole without telling the trader. I hope you can see where this is going, it starts a waterfall of selling and premature closing of positions.
A lot of traders have been using margin in the last decade because rates have been so low, it’s been cheap money. The fear is when margin is more expensive where the spread is less and less, it’s harder to make money. Combine that with the above scenario, you have a full fledge meltdown in a very short time.
This is very simplistic explanation of how this can unravel very quickly. My advice to anyone that’s heavy in the market right now, tune out the noise and keep investing, unless you’re in margin, in that case may god have mercy on your soul.
Quoted for unintentional hilarity. This thread should be kept alive as testament to financial ignorance.
1989
Well-Known Member
Actually 50+ % of Americans own stocks. A nice dip in the market could help cool down housing prices too. Lower prices bring on value and opportunity. I know, you have no idea what that means. Slave wages are what you like.
1989
Well-Known Member
The economy is gang busters for my coworkers. We are a far cry from 1987. We would need the dow to open @ 15,000 tomorrow to compare to ‘87
1% of the population owns 75% of the stocks.
they might as well own 100% of the stocks because some people are pretty slow at figuring out who this system benefits.
Catatonic
Nine Lives
That's a deceiving statement and I doubt it is true.
The 'owners' of that 80% are tens of millions of individuals with retirement plans and mutual funds.
doubt it. most people dont own alot of wealth; its all in teh top 10%. if you dont own alot of wealth, how could you own stocks?
so i just searched it and the top 10% own roughly 82% of all stocks...
Catatonic
Nine Lives
You ever heard the saying, "It's better to not say anything ...".
This might be one of those times for you.
SMH
Catatonic
Nine Lives
Let me see the link because I know that is incorrect or more than likely, you don't understand what you are reading.
Catatonic
Nine Lives
Here's your poster child.
i just read it and its exactly what i said.
the 1% owning 75% of all stocks is a number from a few years back, should be worse now.
from TIME magazine. it quotes:
"So where is middle-class wealth? Wolff finds that the majority of it remains tied to homes. That’s quite different from the wealth holdings of the very rich, whose assets are tied up in equities (whether as publicly held stocks or privately owned shares of businesses). For the richest Americans, a principal residence accounts for just 7.6% of their total wealth."
now look up african and latino wealth and you will be shocked... they own nothing.
The Richest 10% of Americans Now Own 84% of All Stocks
ill find another article as well.
Catatonic
Nine Lives
80% of the stocks owned in America are owned by Funds and retirement plans.
All this stuff you are posting is gibberish or maybe you are talking about the 20% owned by individual investors.
ok so this is not exactly what i said regarding 1% owning 75%"... but this is from the washington post
Perspective | Yes, stocks are up. But 80 percent of the value is held by the richest 10 percent.:
The figures below show that, since the late 1980s, about 80 percent of the value of the market has been held by the top 10 percent. Within that top 10 percent, the share of stock wealth held by the top 1 percent is about equal to the share held by the 90-99th percentiles; both groups’ shares are twice as large as the share that the entire bottom 90 percent holds.
Source: Ed Wolff (
The deeper problem here is the fact that wealth concentration is even more skewed toward the rich than income concentration. The median net worth (income + assets including homeownership – debt) of white households was about $117,000 in 2013. For African American households, the comparable figure is just under $2,000. In other words, black net worth is less than 2 percent that of white net worth.
1989
Well-Known Member
You have it a figured out? That’s why you have been left behind. And you want slave wages to boot.
funds and retirement plans for whom?
