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Strategies & Market Trends : Graham and Doddsville -- Value Investing In The New Era -- Ignore unavailable to you. Want to Upgrade?

To: porcupine --''''> who wrote (1361)	2/25/1999 11:52:00 PM
From: Freedom Fighter	Respond to of 1722

Porc, >>But, it is; and it's troubling that you cannot see the obvious. Advocacy of extreme change is by definition extremism. But, this is just the begining. Everything about the AS shouts out "Extremism!".<< In my mind the term "extremist" in its present common use means more than someone that advocates dramatic change. It has a connotation of somehow being bad, wrong, or evil. Perhaps we do not disagree. I think they want big changes. I do not think they are bad or evil. >>I have already written in 3 postings that I agree that they have interesting and probably important insights. This makes 4 times. At some point I will get around to elaborating.<< I know. No need to. In fact please don't. >>"The minority that benefits under the current system is protecting itself."<< >But, Wayne, that's true of everybody. That has no bearing on the merits of a given proposal for change.< I agree. But the above comment is why I didn't want to get into this discussion to begin with. We've had much of this discussion already. And second, despite those discussions I could tell from your original post that you didn't have a complete picture of what they are advocating, what they think, and why it has some advantages over what we have at present. I must have failed to explain it well. I do not want to spend my time trying to demonstrate something to you that I consider to be irrelevant to investing and that you will probably reject anyway. I have better things to do. It is obvious that if the minority is protecting its interests that the alternative may not have merit or be better. It is also obvious that I must think this alternative has merit or I wouldn't have brought it up. I just don't want to spend time trying to explain it. It's there for anyone interested. >>It's extreme if it advocates extreme change, whether for good or ill.< Again, we agree. It's a matter of the connotation of that word. >>I'll say it again: Lunatics can have interesting and useful insights. But, I don't want them in charge of things, or their proposals widely adopted.<< Neither do I. >But, the question that you had brushed aside by quoting Lynch was whether production generates enough in incomes to clear the Market of what is produced.< The reason I brushed it aside is that I have answered it to the best of my ability several times in the past. I really don't think it's an issue though. My thinking on "value" must be very different than yours. I am thinking in terms of long term average returns on capital, the amount of capital that can be invested, how predictable and certain the cash flows are etc... I am expecting that my company will clear x% of what they produce over the next 10-15 years and be earning 'y' 10-15 years from now. What will I pay for that now to get 'z' return? To anwser your question, I try not to think in terms of incomes or money. I think it can confuse the issue. Money is only a medium of exchange. I like to think in terms of barter. Therefore the short answer is sometimes yes and sometimes no. Sometimes people make more of something than is needed or wanted but most of time they are good at what they do. The poor ones are weeded out. As far as credit in our system goes, if credit comes from savings I think it will clear more often (as above) than if credit comes from bank fiat credit creation. Credit from savings is not generally stimulative in aggregate because what is not consumed is saved and invested and vice versa. It's just a matter of where the money or good is going and who is using it. Credit from fiat is stimulative. That stimulation can cause economic miscalculation. Given time though, the economy will continue to save and invest and grow to use virtually all the initial miscalculation. At least in most cases. I think our system has some other non 'free market' aspects to it that can make the process more difficult. I think the idea should be to avoid anything that causes miscalculation so that the remedies of smoothing out the problems can't add to the problems and the miscalculations will be minimal. Fiat Credit is a primary source of miscalculation and excess. >>To me understanding and money is already enough merit."<< >You still haven't explained that one --'''':> If learning "something" helps me to understand things that beforehand I did not and I can use "it" to make more money, it has merit or value.