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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Mark Adams who wrote (6059)	7/19/2001 9:32:11 PM
From: Maurice Winn	Respond to of 74559

<because of the speed of the huge run up in share prices during 1q00, the appreciation had not been totally absorbed (and spent) mentally by the <bag>holders. Thus the impact of the reversal did not hurt as much as it might have if the price appreciation had taken place at a slower pace. > Good point. The markets cleared really fast, both up and down. Ownership of the same actual money changed quickly and the simple act of ownership change has had little overall impact [though many dreams of leisure and wealth were shattered "So near and yet so far" "There's many a slip twixt the cup and lip"]. Mq

To: Mark Adams who wrote (6059)	7/19/2001 10:40:01 PM
From: Ilaine	Read Replies (2) \| Respond to of 74559

>>I think this kind of statement rises from the fact that the total pool of stock is valued at the price the last trade took place. So while the last buyer paid $200/share for Ariba to the last seller prior to it's swoon to $5, and that money was not destroyed- the paper wealth of all the other Ariba shareholders appeared to rise and fall. Hence the 'destruction of trillions of dollars of wealth since 3/2000'.<< My memory is not as good as it should be - I know Don Lloyd and Grace Zaccardi both explained this very well - my recollection is that Grace explained it to me first but my recollection of the circunstances suggests that it should have been Don. Maybe they remember. But you're right, and they're right, and the people who talk about the trillions of wealth destroyed are wrong. I mentioned it for two reasons: Trivial reason, I was surprised to see Richebacher say it, because I think he's pretty sharp. Major reason, I am starting to think that this concept has not passed into common knowledge, so we are dealing with a concept that needs to be explained so we can pass it on. But I am not sure of that so want feedback. Does this idea have a name? ~~~~~~~~~~~~~~~~~~~ Does illiquid wealth make you feel and act like you're rich with liquid wealth? Depends on how good you are at objective thinking. Some very advanced individuals probably are able to rise above it, but I guess most can't. Nevertheless, the question is, when the market crashed, was wealth destroyed?

To: Mark Adams who wrote (6059)	7/19/2001 11:57:13 PM
From: marek_wojna	Read Replies (1) \| Respond to of 74559

<<I think this kind of statement rises from the fact that the total pool of stock is valued at the price the last trade took place. So while the last buyer paid $200/share for Ariba to the last seller prior to it's swoon to $5, and that money was not destroyed- the paper wealth of all the other Ariba shareholders appeared to rise and fall. Hence the 'destruction of trillions of dollars of wealth since 3/2000'.>> Ask maybe was the wealth there in the first place, or was this promise of wealth? (broken promise)