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

To: Maurice Winn who wrote (11251)	11/23/2001 10:33:45 PM
From: LLCF	Read Replies (1) \| Respond to of 74559

<That assumes a 'normal state' and anyway, that's not the second law of thermodynamics which is to do with thermodynamics, not economic systems. > Has to do with everything... and since economics is simply an outgrowth of 'things' it is not excluded. BTW, it doesn't matter whether yellowstones state was normal or not. <Humans never did revert to the 'normal' state of being a chimpanzee type beast. Computers never did revert to the 'normal' state of being an abacus. The human population never has reverted to the 'normal' state of hunter gatherer numbers. > Humans normal state is not a chimpanzee type beast.. it's a human type. Computers normal state is not the abacus. The human population's normal state may or may not be hunter gatherer. And I'm not talking about PE's at all in my post... it's much more pervasive than that... it's ALL underbrush that has been ignited... so far the real dry stuff [.bom, etc] is ablaze... I expect critical heat soon to allow it to jump to the tree tops :) DAK

To: Maurice Winn who wrote (11251)	11/24/2001 2:04:27 AM
From: Don Lloyd	Respond to of 74559

Maurice - ...With a lot of people deferring consumption and investing, that reduces the average returns on investment. So, while 8% might have been reasonably expected mid 20th century, perhaps 3% is reasonable for these days. Profitability is a reflection of value added. Maybe there are relatively few ways in which high value can be added, so people prefer to just spend their money instead of deferring expenditure to earn a small return on investment.... All good points, except the reality is worse. All investment gains are a combination of fortuitous timing of the valuation fluctuations ( buying low and selling high ) and ownership claims on the real returns of businesses. The former is zero sum over the long term and over all participants. The latter is limited by two factors. First, business returns are not enhanced to any significant degree by the number of public market investors trying to share them, so the rates of return to those investors vary largely inversely to their population. Secondly, the majority of the economic value added by business is not accessible to investors in financial form, but rather flows to consumers in increased standards of living in the form of lower prices, higher quality, and more choices. In addition, sustained profits are the exception, not the rule. Regards, Don