Market Speculation Quotes

It is not hard to make money in the market. What is hard to avoid is the alluring temptation to throw your money away on short, get-rich-quick speculative binges. It is an obvious lesson, but one frequently ignored.

A stock operator has to fight a lot of expensive enemies within himself.

A man must know himself thoroughly if he is going to make a good job out of trading in the speculative markets. To know what I was capable of in the line of folly was a long educational step. I sometimes think that no price is too high for a speculator to pay to learn that which will keep him from getting the swelled head.

The most important of these rules is the first one: the eternal law of reversion to the mean (RTM) in the financial markets.

A man must believe in himself and his judgment if he expects to make a living at this game.

If a man loses his money through unwise market speculation or by playing the horses, he has been punished in a manner which we may call passive. By this I mean that another person has not taken special, socially overt steps to harm the "offender." This phenomenon has not received the attention it deserves.

No, sir, nobody can make big money on what someone else tells him to do.

A capitalist economy cannot be maintained, however, if it oscillates between threats of an imminent collapse of asset values and employment and threats of accelerating inflation and rampant speculation, especially if the threats are sometimes realized. If the market mechanism is to function well, we must arrange to constrain the uncertainty due to business cycles so that the expectations that guide investment can reflect a vision of tranquil progress.

Another lesson I learned early is that there is nothing new in Wall Street. There can't be because speculation is as old as the hills. Whatever happens in the stock market to-day has happened before and will happen again. I've never forgotten that. I suppose I really manage to remember when and how it happened. The fact that I remember that way is my way of capitalizing experience.

The scary thing is that the more open our markets get, the faster people can move their money around and the more trading is based on this kind of speculation instead of serious analysis. And that’s scary because—recall—the whole point of the stock market is to decide the crucial question of what we, as a society, should build for the future. As Keynes says, “When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done.

Our corporate executives speculate with their shareholders’ assets because they get big personal rewards when they win—and even if they lose, they are often bailed out with public funds by obedient politicians. We privatize profit and socialize risk. The

Darknet markets remain the most popular Bitcoin use case after speculation and ransomware. In 2014, darknet markets were estimated to have processed more bitcoins than all legitimate payment processors put together.

In the mutual fund industry, for example, the annual rate of portfolio turnover for the average actively managed equity fund runs to almost 100 percent, ranging from a hardly minimal 25 percent for the lowest turnover quintile to an astonishing 230 percent for the highest quintile. (The turnover of all-stock-market index funds is about 7 percent.)

Human nature, gentleman. It is original sin that leads men to misfortune, every time. I am a speculator in the market, gentlemen, and that is part of God's plan. Men only learn through suffering. So I punish human weakness, and God rewards me.

(Jefferson) was deeply suspicious of Hamilton's assumption plan (by which the nation would assume responsibility for the states' individual war debts.) He feared this was yet another example of the avaricious hand of the unscrupulous money powers, the sprawling, hydra-headed creature associated with banks, stock markets and devious speculators, especially in New York, Boston, and the City of London, not to mention unrepublican, unAmerican attitudes of all kinds - everything he despised.

Before Volcker’s speech, bonds had been conservative investments, into which investors put their savings when they didn’t fancy a gamble in the stock market. After Volcker’s speech, bonds became objects of speculation, a means of creating wealth rather than merely storing it.

The state of perpetual emptiness is, of course, very good for business. The feasts of consumption sustain the economy, keep up the volume in the stock markets, employ the unemployable, excite the fevers of speculation and stimulate the passion for political and sexual novelty.

What imperialists actually wanted was expansion of political power without the foundation of the body politic. Imperialist expansion had been touched off by a curious kind of economic crisis, the overproduction of capital and the emergence of "superfluous" money, the result of oversaving, which could no longer find productive investment within national borders. For the first time, investment of power did not pave the way for investment of money, since uncontrollable investments in distant countries threatened to transform large strata of society into gamblers, to change the whole capitalist economy from a system of production to a system of financial speculation, and to replace the profits of production with profits in commissions. The decade immediately before the imperialist era, the seventies of the last century, witnessed an unparalleled increase in swindles, financial scandals, and gambling in the stock market.

The fact is, nobody has the faintest idea of what is going to happen next year, next week, or even tomorrow. If you hope to get anywhere as a speculator, you must get out of the habit of listening to forecasts. It is of the utmost importance that you never take economists, market advisers, or other financial oracles seriously.

For many of us, trying to outguess the market is a game that is much too much fun to give up. Even if you were convinced you would not do any better than average, I'm sure that most of you with speculative temperaments would still want to keep on playing the game of selecting individual stocks with at least some portion of the money you invest.

The most realistic distinction between the investor and the speculator is found in their attitude toward stock-market movements. The speculator’s primary interest lies in anticipating and profiting from market fluctuations. The investor’s primary interest lies in acquiring and holding suitable securities at suitable prices. Market movements are important to him in a practical sense, because they alternately create low price levels at which he would be wise to buy and high price levels at which he certainly should refrain from buying and probably would be wise to sell. It is far from certain that the typical investor should regularly hold off buying until low market levels appear, because this may involve a long wait, very likely the loss of income, and the possible missing of investment opportunities. On the whole it may be better for the investor to do his stock buying whenever he has money to put in stocks, except when the general market level is much higher than can be justified by well-established standards of value. If he wants to be shrewd he can look for the ever-present bargain opportunities in individual securities. Aside from forecasting the movements of the general market, much effort and ability are directed on Wall Street toward selecting stocks or industrial groups that in matter of price will “do better” than the rest over a fairly short period in the future. Logical as this endeavor may seem, we do not believe it is suited to the needs or temperament of the true investor—particularly since he would be competing with a large number of stock-market traders and first-class financial analysts who are trying to do the same thing. As in all other activities that emphasize price movements first and underlying values second, the work of many intelligent minds constantly engaged in this field tends to be self-neutralizing and self-defeating over the years. The investor with a portfolio of sound stocks should expect their prices to fluctuate and should neither be concerned by sizable declines nor become excited by sizable advances. He should always remember that market quotations are there for his convenience, either to be taken advantage of or to be ignored. He should never buy a stock because it has gone up or sell one because it has gone down. He would not be far wrong if this motto read more simply: “Never buy a stock immediately after a substantial rise or sell one immediately after a substantial drop.” An

The worst continued to worsen. What looked one day like the end proved on the next day to have been only the beginning. Nothing could have been more ingeniously designed to maximize the suffering, and also to insure that as few people as possible escape the common misfortune. The fortunate speculator who had funds to answer the first margin call presently got another and equally urgent one, and if he met that there would still be another. In the end all the money he had was extracted from him and lost. The man with the smart money, who was safely out of the market when the first crash came, naturally went back in to pick up bargains. The bargains then suffered a ruinous fall. Even the man who waited for volume of trading to return to normal and saw Wall Street become as placid as a produce market, and who then bought common stocks would see their value drop to a third or a fourth of the purchase price in the next 24 months. The Coolidge bull market was a remarkable phenomenon. The ruthlessness of its liquidation was, in its own way, equally remarkable.

Over the short run, however, the fundamentals are often overwhelmed by the deafening noise of speculation—the price at which the stock market values each dollar of earnings.

Don’t speculate unless you are sure you have an edge. Without an edge you can’t beat the market.

the entire art of speculation consists of choosing the right moment to invest in a way opposite to that suggested by popular opinion.

In the stock market the more elaborate and abstruse the mathematics the more uncertain and speculative the conclusion we draw therefrom….

Not losing big is the single most important factor for winning big. As a speculator, losing is not a choice, but how much you lose is.

What is true of the farmer is equally true of the middle man; whether the middle man acts as factor, jobber, salesman, or speculator, in the markets of grain. These traders are to be left to their free course; and the more they make, and the richer they are, and the more largely they deal, the better both for the farmer and consumer, between whom they form a natural and most useful link of connection; though, by the machinations of the old evil counsellor, Envy, they are hated and maligned by both parties. [Thoughts and Details on Scarcity]

..."extreme capitalism": the obsessive, uncritical penetration of the concept of the market into every aspect of American life, and the attempt to drive out every other institution, including law, art, culture, public education, Social Security, unions, community, you name it. It is the conflation of markets with populism, with democracy, with diversity, with liberty, and with choice---and so the denial of any form of choice that imposes limits on the market. More than that, it is the elimination of these separate concepts from our political discourse, so that we find ourselves looking to the stock market to fund retirement, college education, health care, and having forgotten that in other wealthy and developed societies these are rights, not the contingent outcomes of speculative games. James K. Galbraith, Lloyd M. Bentsen Jr. Chair in Government/Business Relations and Professor of Government, University of Texas.

The speculator's chief enemies are always boring from within. It is inseparable from human nature to hope and to fear. In speculation when the market goes against you you hope that every day will be the last day and you lose more than you should had you not listened to hope to the same ally that is so potent a success-bringer to empire builders and pioneers, big and little. And when the market goes your way you become fearful that the next day will take away your profit, and you get out too soon. Fear keeps you from making as much money as you ought to. The successful trader has to fight these two deep-seated instincts. He has to reverse what you might call his natural impulses. Instead of hoping he must fear; instead of fearing he must hope. He must fear that his loss may develop into a much bigger loss, and hope that his profit may become a big profit. It is absolutely wrong to gamble in stocks the way the average man does.

They look, I said. They look in all our rooms. What for? he said. I think I lost control then, a little. Razor blades, I said, Books, writing, black market stuff. All things we aren't supposed to have.

well-functioning market requires all three types of investors for socially beneficial projects to have access to cheap capital. Value investors allocate capital to its most productive use. Speculators, because they trade frequently, provide the liquidity and trading volume that allows value investors and relative value traders to execute their trades cheaply. They also ensure that information is disseminated quickly.

As a result, Keynes warned, the stock market would become “a battle of wits to anticipate the basis of conventional valuation a few months hence, rather than the prospective yield of an investment over a long term of years.

Our essential difficulty is that we are seeking in a mechanism, which is necessary, qualities it simply does not possess. The market does not lead, balance or encourage democracy. However, properly regulated it is the most effective way to conduct business. It cannot give leadership even on straight economic issues. The world-wide depletion of fish stocks is a recent example. The number of fish caught between 1950 and 1989 multiplied by five. The fishing fleet went from 585,000 boats in 1970 to 1.2 million in 1990 and on to 3.5 million today (1995). No one thought about the long- or even medium-term maintenance of stocks; not the fishermen, not the boat builders, not the fish wholesalers who found new uses for their product, including fertilizer and chicken feed; not the financiers. It wasn't their job. Their job was to worry about their own interests. (IV - From Managers and Speculators to Growth)

How do you solve a problem as old as the United States? Gentrification may be a relatively recent phenomenon, but as geographer Neil Smith notes, it's really just the continuation of the 'locational seesaw' - capital moves to one place seeking high profits, then, when that place becomes less profitable, it moves to another place. The real estate industry is always looking for new markets in which it can revitalize its profit rate. Fifty years ago that place was suburbs. Today it's cities. But that's only half the explanation for gentrification. In order to understand why cities are so attractive to invest in, it's important to understand what made them bargains for real estate speculators in the first place. It may sound obvious, but gentrification could not happen without something to gentrify. Truly equitable geographies would be largely un-gentrifiable ones. So first, geographies have to be made unequal.

To say now that the negative results of globalization are simply Destiny is to say that a whole new round of social divisions and violence is also our Destiny. In other words, the collapsing job market, slipping standards of living, the loss of fair regulations, the evaporation of big business tax revenues and the weakening of social programs are inevitable and so we must begin the endless, sterile battles of social division all over again. (IV - From Managers and Speculators to Growth)

In the 1960's, some old-timers on Wall Street-the men who remembered the trauma of the 1929 Crash and the Great Depression-gave me a warning: "When we fade from this business, something will be lost. That is the memory of 1929." Because of that personal recollection, they said, they acted with more caution, than they otherwise might. Collectively, their generation provided an in-built brake on the wildest form of speculation, an insurance policy against financial excess and consequent catastrophe. Their memories provided a practical form of long-term dependence in the financial markets. Is it any wonder that in 1987 when most of those men were gone and their wisdom forgotten, the market encountered its first crash in nearly sixty years? Or that, two decades later, we would see the biggest bull market, and the worst bear market, in generations? Yet standard financial theory holds that, in modeling markets, all that matters is today's news and the expectations of tomorrow's news.

Americans built a culture of speculation unique in its abandon,” writes the historian Joshua Rothman in his book Flush Times and Fever Dreams. That culture would drive cotton production up to the Civil War, and it has been a defining characteristic of American capitalism ever since. It is the culture of acquiring wealth without work, growing at all costs, and abusing the powerless. It is the culture that brought us catastrophic downturns, like the Panic of 1837, the stock market crash of 1929, and the recession of 2008.

First, there is a large body of empirical evidence on the predictive accuracy of speculative markets, on everything from horse-racing to elections to invasions. “Put your money where your mouth is” turns out to be a great way to get the well informed to reveal what they know, and the poorly informed to quiet down. No system is perfect, but betting markets outperform other methods of prediction in a wide variety of circumstances. The PAM was inspired not by ivory tower theorizing, but by the proven success of betting markets in other areas.

What is a price? It is a proposed point of agreement between a buyer and seller. The proposal is the key. It is not a marching order. Past prices represent deals done in history. Current prices represent possible deals in the future. Prices embed vast information about perceived realities: resource availability, consumer demand, cultural biases and habits, speculations about the future. The price is also an amazing tool. It provides an objective basis for accounting and the assessment of profit and loss. Without prices, real prices rooted in real market experience, we’d been lost.

I have been in the speculative game ever since I was fourteen. It is all I have ever done. I think I know what I am talking about. And the conclusion that I have reached after nearly thirty years of constant trading, both on a shoestring and with millions of dollars back of me, is this: A man may beat a stock or a group at a certain time, but no man living can beat the stock market! A man may make money out of individual deals in cotton or grain, but no man can beat the cotton market or the grain market. It's like the track. A man may beat a horse race, but he cannot beat horse racing.

Oh I could be out, rollicking in the ripeness of my flesh and others’, could be drinking things and eating things and rubbing mine against theirs, speculating about this person or that, waving, indicating hello with a sudden upward jutting of my chin, sitting in the backseat of someone else’s car, bumping up and down the San Francisco hills, south of Market, seeing people attacking their instruments, afterward stopping at a bodega, parking, carrying the bottles in a paper bag, the glass clinking, all our faces bright, glowing under streetlamps, down the sidewalk to this or that apartment party, hi, hi, putting the bottles in the fridge, removing one for now, hating the apartment, checking the view, sitting on the arm of a couch and being told not to, and then waiting for the bathroom, staring idly at that ubiquitous Ansel Adams print, Yosemite, talking to a short-haired girl while waiting in the hallway, talking about teeth, no reason really, the train of thought unclear, asking to see her fillings, no, really, I’ll show you mine first, ha ha, then no, you go ahead, I’ll go after you, then, after using the bathroom she is still there, still in the hallway, she was waiting not just for the bathroom but for me, and so eventually we’ll go home together, her apartment, where she lives alone, in a wide, immaculate railroad type place, newly painted, decorated with her mother, then sleeping in her oversized, oversoft white bed, eating breakfast in her light-filled nook, then maybe to the beach for a few hours with the Sunday paper, then wandering home whenever, never- Fuck. We don't even have a baby-sitter.

Hope does not mean that our protests will suddenly awaken the dead consciences, the atrophied souls, of the plutocrats running Halliburton, Goldman Sachs, Exxon Mobil or the government. Hope does not mean we will reform Wall Street swindlers and speculators. Hope does not mean that the nation’s ministers and rabbis, who know the words of the great Hebrew prophets, will leave their houses of worship to practice the religious beliefs they preach. Most clerics like fine, abstract words about justice and full collection plates, but know little of real hope. Hope knows that unless we physically defy government control we are complicit in the violence of the state. All who resist keep hope alive. All who succumb to fear, despair and apathy become enemies of hope. Hope has a cost. Hope is not comfortable or easy. Hope requires personal risk. Hope does not come with the right attitude. Hope is not about peace of mind. Hope is an action. Hope is doing something. Hope, which is always nonviolent, exposes in its powerlessness the lies, fraud and coercion employed by the state. Hope does not believe in force. Hope knows that an injustice visited on our neighbor is an injustice visited on us all. Hope sees in our enemy our own face. Hope is not for the practical and the sophisticated, the cynics and the complacent, the defeated and the fearful. Hope is what the corporate state, which saturates our airwaves with lies, seeks to obliterate. Hope is what our corporate overlords are determined to crush. Be afraid, they tell us. Surrender your liberties to us so we can make the world safe from terror. Don’t resist. Embrace the alienation of our cheerful conformity. Buy our products. Without them you are worthless. Become our brands. Do not look up from your electronic hallucinations to think. No. Above all do not think. Obey. The powerful do not understand hope. Hope is not part of their vocabulary. They speak in the cold, dead words of national security, global markets, electoral strategy, staying on message, image and money. Those addicted to power, blinded by self-exaltation, cannot decipher the words of hope any more than most of us can decipher hieroglyphics. Hope to Wall Street bankers and politicians, to the masters of war and commerce, is not practical. It is gibberish. It means nothing. I cannot promise you fine weather or an easy time. I cannot pretend that being handcuffed is pleasant. If we resist and carry out acts, no matter how small, of open defiance, hope will not be extinguished. Any act of rebellion, any physical defiance of those who make war, of those who perpetuate corporate greed and are responsible for state crimes, anything that seeks to draw the good to the good, nourishes our souls and holds out the possibility that we can touch and transform the souls of others. Hope affirms that which we must affirm. And every act that imparts hope is a victory in itself.

Financial markets are far too complex to isolate any single variable with ease, as if conducting a scientific experiment. The record is utterly bereft of evidence that definitive predictions of short-term fluctuations in stock prices can be made with consistent accuracy. The prices of common stocks are evanescent and illusory.

the time, a psychologist and marketing expert by the name of Ernest Dichter speculated that leaving out some of the ingredients and allowing women to add them to the mix might resolve the issue.• This idea became known as the “egg theory.” Sure enough, once Pillsbury left out the dried eggs and required women to add fresh ones,

The place reeked of vice and corruption and the dregs of Parisian society in all its rottenness gathered there: cheats, conmen and cheap hacks rubbed shoulders with under-age dandies, old roués and rogues, sleazy underworld types once notorious for things best forgotten mingled with other small-time crooks and speculators, dabblers in dubious ventures, frauds, pimps, and racketeers. Cheap sex, both male and female, was on offer in this tawdry meat-market of a place where petty rivalries were exploited, and quarrels picked over nothing in an atmosphere of fake gallantry where swords or pistols at dawn settled matters of highly questionable honour in the first place.

For example, trading in S&P 500-linked futures totaled more than $60 trillion(!) in 2011, five times the S&P 500 Index total market capitalization of $12.5 trillion. We also have credit default swaps, which are essentially bets on whether a corporation can meet the interest payments on its bonds. These credit default swaps alone had a notional value of $33 trillion. Add to this total a slew of other derivatives, whose notional value as 2012 began totaled a cool $708 trillion. By contrast, for what it’s worth, the aggregate capitalization of the world’s stock and bond markets is about $150 trillion, less than one-fourth as much. Is this a great financial system . . . or what!

There have been many times when I, like many other speculators, have not had the patience to await the sure thing. I wanted to have an interest at all times. You may say, “With all your experience, why did you allow yourself to do so?” The answer to that is that I am human and subject to human weakness. —Jesse Livermore, How to Trade in Stocks

Speculation does not determine prices; it has to accept the prices that are determined in the market. I ts efforts are directed to correctly estimating future price-situations, and to acting accordingly. The influence of speculation cannot alter the average level of prices over a given period; what it can do is to diminish the gap between the highest and the lowest prices.

The party will go on until reckless speculation becomes unsustainable, ending with the inevitable collapse in bullish sentiment, a phenomenon called a Minsky moment, named for economist Hyman Minsky. It’s what happens when market watchers suddenly begin to wake up and worry about irrational exuberance. Once their sentiment changes, a crash is inevitable as an asset and credit bubble and boom goes into a bust.

Speculation and opinions drove not only the market but the products, sadly, the values of which were hinged not to the ineffable quality of art as a sacred human ritual—a value impossible to measure, anyway—but to what a bunch of rich assholes thought would “elevate” their portfolios and inspire jealousy and, delusional as they all were, respect. I was perfectly happy to wipe out all that garbage from my mind.

The cultural Left has contributed to the formation of this politically useless unconscious not only by adopting “power” as the name of an invisible, ubiquitous, and malevolent presence, but by adopting ideals which nobody is yet able to imagine being actualized. Among these ideals are participatory democracy and the end of capitalism. Power will pass to the people, the Sixties Left believed only when decisions are made by all those who may be affected by the results. This means, for example, that economic decisions will be made by stakeholders rather than by shareholders, and that entrepreneurship and markets will cease to play their present role. When they do, capitalism as we know it will have ended, and something new will have taken its place. […] Sixties leftists skipped lightly over all the questions which had been raised by the experience of non market economies in the so-called socialist countries. They seemed to be suggesting that once we were rid of both bureaucrats and entrepreneurs, “the people” would know how to handle competition from steel mills or textile factories in the developing world, price hikes on imported oil, and so on. But they never told us how “the people” would learn how to do this. The cultural Left still skips over such questions. Doing so is a consequence of its preference for talking about “the system” rather than about specific social practices and specific changes in those practices. The rhetoric of this Left remains revolutionary rather than reformist and pragmatic. Its insouciant use of terms like “late capitalism” suggests that we can just wait for capitalism to collapse, rather than figuring out what, in the absence of markets, will set prices and regulate distribution. The voting public, the public which must be won over if the Left is to emerge from the academy into the public square, sensibly wants to be told the details. It wants to know how things are going to work after markets are put behind us. It wants to know how participatory democracy is supposed to function. The cultural Left offers no answers to such demands for further information, but until it confronts them it will not be able to be a political Left. The public, sensibly, has no interest in getting rid of capitalism until it is offered details about the alternatives. Nor should it be interested in participatory democracy –– the liberation of the people from the power of technocrats –– until it is told how deliberative assemblies will acquire the same know-how which only the technocrats presently possess. […] The cultural Left has a vision of an America in which the white patriarchs have stopped voting and have left all the voting to be done by members of previously victimized groups, people who have somehow come into possession of more foresight and imagination than the selfish suburbanites. These formerly oppressed and newly powerful people are expected to be as angelic as the straight white males were diabolical. If I shared this expectation, I too would want to live under this new dispensation. Since I see no reason to share it, I think that the left should get back into the business of piecemeal reform within the framework of a market economy. This was the business the American Left was in during the first two-thirds of the century. Someday, perhaps, cumulative piecemeal reforms will be found to have brought about revolutionary change. Such reforms might someday produce a presently unimaginable non market economy, and much more widely distributed powers of decision making. […] But in the meantime, we should not let the abstractly described best be the enemy of the better. We should not let speculation about a totally changed system, and a totally different way of thinking about human life and affairs, replace step-by-step reform of the system we presently have.

In a broad sense, this book, from its first edition in 2000, has been about trying to understand the change in thinking of the people whose actions ultimately drive the markets. It is about the psychology of speculation, about the feedback mechanism that intensifies this psychology, about herd behavior that can spread through millions or even billions of people, and about the implications of such behavior for the economy and for our lives. Although the book originally focused directly on current economic events, it was, and is, about how errors of human judgment can infect even the smartest people, thanks to overconfidence, lack of attention to details, and excessive trust in the judgments of others, stemming from a failure to understand that others are not making independent judgments but are themselves following still others—the blind leading the blind.

The markets fluctuated alarmingly for the rest of the month, falling one day, recovering the next, then plummeting another, leaving speculators alternating between relief and hysteria. By the end of November, with many nervous New Yorkers clamoring for reassurances, Strong confided he was as fearful about Northern capitulation as he was about Southern belligerence. “Our national mottoes must be changed to ‘e pluribus duo’ (at least) and ‘United we stand, divided we stand easier.

The panic was blamed on many factors—tight money, Roosevelt’s Gridiron Club speech attacking the “malefactors of great wealth,” and excessive speculation in copper, mining, and railroad stocks. The immediate weakness arose from the recklessness of the trust companies. In the early 1900s, national and most state-chartered banks couldn’t take trust accounts (wills, estates, and so on) but directed customers to trusts. Traditionally, these had been synonymous with safe investment. By 1907, however, they had exploited enough legal loopholes to become highly speculative. To draw money for risky ventures, they paid exorbitant interest rates, and trust executives operated like stock market plungers. They loaned out so much against stocks and bonds that by October 1907 as much as half the bank loans in New York were backed by securities as collateral—an extremely shaky base for the system. The trusts also didn’t keep the high cash reserves of commercial banks and were vulnerable to sudden runs.

In recent years, annual trading in stocks—necessarily creating, by reason of the transaction costs involved, negative value for traders—averaged some $33 trillion. But capital formation—that is, directing fresh investment capital to its highest and best uses, such as new businesses, new technology, medical breakthroughs, and modern plant and equipment for existing business—averaged some $250 billion. Put another way, speculation represented about 99.2 percent of the activities of our equity market system, with capital formation accounting for 0.8 percent.

Trends consist of three specific phases. Every trend moves through three phases. The accumulation phase is the period when investors with exceptional information actively buy (in a bullish trend) or sell (in a bearish trend). The public participation phase occurs when, due to price movement caused by activity in the accumulation phase, the general public joins in the trend. Finally, the distribution phase occurs when speculators enter the market and over-buy or over-sell, and at this point the observant investor begins to transact in the opposite direction.

The last statement reveals more than may appear at first glance: it indicates that Greenspan's mistake was to expect that the lending institutions' enlightened self-interest would make them act more responsibly, more ethically, in order to avoid short-term self-propelling cycles of wild speculation which, sooner or later, burst like a bubble. In other words, his mistake concerned not the facts, the objective economic data or mechanisms; it concerned rather the ethical attitudes generated by market speculation—in particular the premise that market processes will spontaneously generate responsibility and trust, since it is in the long-term self-interest of the participants themselves to act thusly. Clearly, Greenspan's error was not only and not simply one of overestimating the rationality of market agents—that is, their ability to resist the temptation of making wild speculative gains. What he forgot to include in the equation was the financial speculators' quite rational expectation that the risks would be worth taking, since, in the event of a financial collapse, they could count on the state to cover their losses.

If one day Balloon Dog’s value bursts and shrivels in a Koons crash, we can only hope that Anonymous has an ongoing relationship with his orange pooch that can sustain the inevitable inflations and deflations of all speculative markets. In fact, a balloon serves as a nice metaphor for the lessons of history: you blow and you blow and you blow, and the thing gets larger and larger and larger still, and in your excitement you forget the laws of physics, and you begin to believe that your balloon is like no other balloon in the world—there is no limit to its size. And then, it pops.

I have been in the speculative game ever since I was fourteen. It is all I have ever done. I think I know what I am talking about. And the conclusion that I have reached after nearly thirty years of constant trading, both on a shoestring and with millions of dollars back of me, is this: A man may beat a stock or a group at a certain time, but no man living can beat the stock market! A man may make money out of individual deals in cotton or grain, but no man can beat the cotton market or the grain market. It's like the track. A man may beat a horse race, but he cannot beat horse racing.

The Austrian born Von Hayek has long been under the control of David Rockefeller, and Von Hayek theories have been fairly widely accepted in the United States for some time, especially in “conservative” circles. According to Von Hayek, a future United States economic platform must be based on (a) urban black markets, (b) small Hong Kong type industries utilizing sweatshop labor, (c) the tourist trade, (d) free enterprise zones where speculators can operate unhindered and where the drug trade can flourish, (e) the end of all industrial activity and (f) closing down of all nuclear energy plants.

Posterity can pay for its ancestors’ lives because posterity can be richer through innovation. If somebody somewhere takes out a mortgage, which he will repay in three decades’ time, to invest in a business that invents a gadget that saves his customers time, then that money, brought forward from the future, will enrich both him and those customers to the point where the loan can be repaid to posterity. That is growth. If, on the other hand, somebody takes out a loan just to support his luxury lifestyle, or to speculate on asset markets by buying a second home, then posterity will be the loser.

You didn’t warn us about this, Readier,’ said Stowley resentfully. Gilt waved his hands. ‘We must speculate to accumulate!’ he said. ‘The Post Office? Trickery and sleight of hand. Oh, von Lipwig is an ideas man, but that’s all he is. He’s made a splash, but he’s not got the stamina for the long haul. Yet as it turns out he will do us a favour. Perhaps we have been . . . a little smug, a little lax, but we have learned our lesson! Spurred by the competition we are investing several hundred thousand dollars—’ ‘Several hundred?’ said Greenyham. Gilt waved him into silence, and continued: ‘—several hundred thousand dollars in a challenging, relevant and exciting systemic overhaul of our entire organization, focusing on our core competencies while maintaining full and listening co-operation with the communities we are proud to serve. We fully realize that our energetic attempts to mobilize the flawed infrastructure we inherited have been less than totally satisfactory, and hope and trust that our valued and loyal customers will bear with us in the coming months as we interact synergistically with change management in our striving for excellence. That is our mission.’ An awed silence followed.

The art world had turned out to be like the stock market, a reflection of political trends and the persuasions of capitalism, fueled by greed and gossip and cocaine. I might as well have worked on Wall Street. Speculation and opinions drove not only the market but the products, sadly, the values of which were hinged not to the ineffable quality of art as a sacred human ritual—a value impossible to measure, anyway—but to what a bunch of rich assholes thought would “elevate” their portfolios and inspire jealousy and, delusional as they all were, respect. I was perfectly happy to wipe out all that garbage from my mind.

possibility is that the crisis happened partly because the economic models of the mainstream rendered that outcome ostensibly so unlikely in theory that they ended up making it far more likely in practice. The insouciance encouraged by the rational-expectations and efficient-market hypotheses made regulators and investors careless. As Minsky argued, stability destabilizes. This is an aspect of what George Soros, the successful speculator and innovative economic thinker, calls ‘reflexivity’: the way human beings think determines the reality in which they live.5 Naive economics helps cause unstable economies. Meanwhile,

It is true that the speculator may happen to go astray in his estimate of future prices. What is usually overlooked in considering this possibility is that under the given conditions it is far beyond the capacities of most people to foresee the future any more correctly. If this were not so, the opposing group of buyers or sellers would have got the upper hand in the market. The fact that the opinion accepted by the market has later proved to be false is lamented by nobody with more genuine sorrow than by the speculators who held it. They do not err of malice prepense; after all, their object is to make profits, not losses.

Goldman Sachs hoards rice, wheat, corn, sugar and livestock and jacks up commodity prices around the globe so that poor families can no longer afford basic staples and literally starve. Goldman Sachs is able to carry out its malfeasance at home and in global markets because it has former officials filtered throughout the government and lavishly funds compliant politicians—including Barack Obama, who received $1 million from employees at Goldman Sachs in 2008 when he ran for president. These politicians, in return, permit Goldman Sachs to ignore security laws that under a functioning judiciary system would see the firm indicted for felony fraud. Or, as in the case of Bill Clinton, these politicians pass laws such as the 2000 Commodity Futures Modernization Act that effectively removed all oversight and outside control over the speculation in commodities, one of the major reasons food prices have soared. In 2008 and again in 2010 prices for crops such as rice, wheat and corn doubled and even tripled, making life precarious for hundreds of millions of people. And it was all done so a few corporate oligarchs, the 1 percent, could make personal fortunes in the tens and hundreds of millions of dollars. Despite a damning 650-page Senate subcommittee investigation report, no individual at Goldman Sachs has been indicted, although the report accuses Goldman of defrauding its clients.319

A gambler must think of three main quantities, stake, odds, and prize. If the prize is very large, a gambler is prepared to risk a big stake. A gambler who risks his all on a single throw stands to gain a great deal. He also stands to lose a great deal, but on average high-stake gamblers are no better and no worse off than other players who play for low winnings with low stakes. An analogous comparison is that between speculative and safe investors on the stock market. In some ways the stock market is a better analogy than a casino, because casinos are deliberately rigged in the bank's favour (which means, strictly, the high-stakes players will on average end up poorer than low-stake players; and low-stake players poorer than those who don't gamble at all.

There was more than one way to think about Mike Burry’s purchase of a billion dollars in credit default swaps. The first was as a simple, even innocent, insurance contract. Burry made his semiannual premium payments and, in return, received protection against the default of a billion dollars’ worth of bonds. He’d either be paid zero, if the triple-B-rated bonds he’d insured proved good, or a billion dollars, if those triple-B-rated bonds went bad. But of course Mike Burry didn’t own any triple-B-rated subprime mortgage bonds, or anything like them. He had no property to “insure” it was as if he had bought fire insurance on some slum with a history of burning down. To him, as to Steve Eisman, a credit default swap wasn’t insurance at all but an outright speculative bet against the market—and this was the second way to think about it.

It is one thing to explain the causal origins of thinking, as science commendably does; it is an entirely different thing to conflate thinking in its formal or rule-governed dimension with its evolutionary genesis. Being conditioned is not the same as being constituted. Such a conflation not only sophistically elides the distinction between the substantive and the formal, it also falls victim to a dogmatic metaphysics that is impulsively blind to its own epistemological and methodological bases qua origins. It is this genetic fallacy that sanctions the demotion of general intelligence as qualitatively distinct to a mere quantitative account of intelligent behaviours prevalent in nature. It should not come as a any surprise that this is exactly the jaded gesture of antihumanism upon whose shoddy pillars today's discourse of posthumanism supports its case. Talk of thinking forests, rocks, worn shoes, and ethereal beings goes hand in hand with the cult of technological singularity, musings on Skynet or the Market as speculative posthuman intelligence, and computers endowed with intellectual intuition. And again, by now it should have become obvious that, despite the seeming antagonism between these two camps - one promoting the so-called egalitarianism of going beyond human conditions by dispensing with the rational resources of critique, the other advancing the speculative aspects of posthuman supremacy on the grounds of the technological overcoming of the human condition - they both in fact belong to the arsenal of today's neoliberal capitalism in its full-on assault on any account of intelligence that may remotely insinuate an ambition for collective rationality and imagination.

That City of yours is a morbid excrescence. Wall Street is a morbid excrescence. Plainly it's a thing that has grown out upon the social body rather like -- what do you call it? -- an embolism, thrombosis, something of that sort. A sort of heart in the wrong place, isn't it? Anyhow -- there it is. Everything seems obliged to go through it now; it can hold up things, stimulate things, give the world fever or pain, and yet all the same -- is it necessary, Irwell? Is it inevitable? Couldn't we function economically quite as well without it? Has the world got to carry that kind of thing for ever? "What real strength is there in a secondary system of that sort? It's secondary, it's parasitic. It's only a sort of hypertrophied, uncontrolled counting-house which has become dominant by falsifying the entries and intercepting payment. It's a growth that eats us up and rots everything like cancer. Financiers make nothing, they are not a productive department. They control nothing. They might do so, but they don't. They don't even control Westminster and Washington. They just watch things in order to make speculative anticipations. They've got minds that lie in wait like spiders, until the fly flies wrong. Then comes the debt entanglement. Which you can break, like the cobweb it is, if only you insist on playing the wasp. I ask you again what real strength has Finance if you tackle Finance? You can tax it, regulate its operations, print money over it without limit, cancel its claims. You can make moratoriums and jubilees. The little chaps will dodge and cheat and run about, but they won't fight. It is an artificial system upheld by the law and those who make the laws. It's an aristocracy of pickpocket area-sneaks. The Money Power isn't a Power. It's respectable as long as you respect it, and not a moment longer. If it struggles you can strangle it if you have the grip...You and I worked that out long ago, Chiffan... "When we're through with our revolution, there will be no money in the world but pay. Obviously. We'll pay the young to learn, the grown-ups to function, everybody for holidays, and the old to make remarks, and we'll have a deuce of a lot to pay them with. We'll own every real thing; we, the common men. We'll have the whole of the human output in the market. Earn what you will and buy what you like, we'll say, but don't try to use money to get power over your fellow-creatures. No squeeze. The better the economic machine, the less finance it will need. Profit and interest are nasty ideas, artificial ideas, perversions, all mixed up with betting and playing games for money. We'll clean all that up..." "It's been going on a long time," said Irwell. "All the more reason for a change," said Rud.

An attempt is sometimes made to demonstrate the desirability of measures directed against speculation by reference to the fact that there are times when there is nobody in opposition to the bears in the foreign-exchange market so that they alone are able to determine the rate of exchange. That, of course, is not correct. Yet it must be noticed that speculation has a peculiar effect in the case of a currency whose progressive depreciation is to be expected while it is impossible to foresee when the depreciation will stop, if at all. While, in general, speculation reduces the gap between the highest and lowest prices without altering the average price-level, here, where the movement will presumably continue in the same direction, this naturally can not be the case. The effect of speculation here is to permit the fluctuation, which would otherwise proceed more uniformly, to proceed by fits and starts with the interposition of pauses.

For some years, Trieste was a murky exchange for the commodities most coveted in the deprived societies of Hungary, Czechoslovakia, Bulgaria, Romania and Yugoslavia. Jeans, for example, were then almost a currency of their own, so terrific was the demand on the other side of the line, and the trestle tables of the Ponterosso market groaned with blue denims of dubious origin ("Jeans Best for Hammering, Pressing and Screwing", said a label I noted on one pair). There was a thriving traffic in everything profitably resellable, smuggleable or black-marketable - currencies, stamps, electronics, gold. Not far from the Ponterosso market was Darwil's, a five-storey jewellers' shop famous among gold speculators throughout central Europe. Dazzling were its lights, deafening was its rock music, and through its blinding salons clutches of thick-set conspiratorial men muttered and wandered, inspecting lockets through eye-glasses, stashing away watches in suitcases, or coldly watching the weighing of gold chains in infinitesimal scales.

In this sense, therefore, inasmuch as we have access to neither the beautiful nor the ugly, and are incapable of judging, we are condemned to indifference. Beyond this indifference, however, another kind of fascination emerges, a fascination which replaces aesthetic pleasure. For, once liberated from their respective constraints, the beautiful and the ugly, in a sense, multiply: they become more beautiful than beautiful, more ugly than ugly. Thus painting currently cultivates, if not ugliness exactly - which remains an aesthetic value - then the uglier-than-ugly (the 'bad', the 'worse', kitsch), an ugliness raised to the second power because it is liberated from any relationship with its opposite. Once freed from the 'true' Mondrian, we are at liberty to 'out-Mondrian Mondrian'; freed from the true naifs, we can paint in a way that is 'more naif than naif', and so on. And once freed from reality, we can produce the 'realer than real' - hyperrealism. It was in fact with hyperrealism and pop art that everything began, that everyday life was raised to the ironic power of photographic realism. Today this escalation has caught up every form of art, every style; and all, without discrimination, have entered the transaesthetic world of simulation. There is a parallel to this escalation in the art market itself. Here too, because an end has been put to any deference to the law of value, to the logic of commodities, everything has become 'more expensive than expensive' - expensive, as it were, squared. Prices are exorbitant - the bidding has gone through the roof. Just as the abandonment of all aesthetic ground rules provokes a kind of brush fire of aesthetic values, so the loss of all reference to the laws of exchange means that the market hurtles into unrestrained speculation. The frenzy, the folly, the sheer excess are the same. The promotional ignition of art is directly linked to the impossibility of all aesthetic evaluation. In the absence of value judgements, value goes up in flames. And it goes up in a sort of ecstasy. There are two art markets today. One is still regulated by a hierarchy of values, even if these are already of a speculative kind. The other resembles nothing so much as floating and uncontrollable capital in the financial market: it is pure speculation, movement for movement's sake, with no apparent purpose other than to defy the law of value. This second art market has much in common with poker or potlatch - it is a kind of space opera in the hyperspace of value. Should we be scandalized? No. There is nothing immoral here. Just as present-day art is beyond beautiful and ugly, the market, for its part, is beyond good and evil.

This kind of speculation reached a high point with the Pentagon's initiative of creating a 'futures market in events', a stock market of prices for terrorist attacks or catastrophes. You bet on the probable occurrence of such events against those who don't believe they'll happen. This speculative market is intended to operate like the market in soya or sugar. You might speculate on the number of AIDS victims in Africa or on the probability that the San Andreas Fault will give way (the Pentagon's initiative is said to derive from the fact that they credit the free market in speculation with better forecasting powers than the secret services). Of course it is merely a step from here to insider trading: betting on the event before you cause it is still the surest way (they say Bin Laden did this, speculating on TWA shares before 11 September). It's like taking out life insurance on your wife before you murder her. There's a great difference between the event that happens (happened) in historical time and the event that happens in the real time of information. To the pure management of flows and markets under the banner of planetary deregulation, there corresponds the 'global' event- or rather the globalized non-event: the French victory in the World Cup, the year 2000, the death of Diana, The Matrix, etc. Whether or not these events are manufactured, they are orchestrated by the silent epidemic of the information networks. Fake events.

In a sense, the farmer was the looniest speculator in a nation overrun with them. He was wagering he would master this fathomlessly intricate global game, pay off his many debts, and come out with enough extra to play another round. On top of that, he was betting on the kindness of Mother Nature, always supremely risky. But the farmer had no choice if he hoped to sustain himself and a way of life, the family farm. Instead, he was drawn into a kind of social suicide. The family farm and the whole network of small-town life that it patronized were being washed away into the rivers of capital and credit that flowed toward the railroads, banks, and commodity exchanges, toward the granaries, wholesalers, and numerous other intermediaries that stood between the farmer and the world market. Disappearing into all the reservoirs of capital accumulation, the family farm increasingly remained a privileged way of life only in sentimental memory. Perversely the dynamic Lincoln had described as the pathway out of dependency—spending a few years earning wages, saving up, buying a competency, and finally hiring others—now operated in reverse. Starting out as independent farmers, families then slipped inexorably downward, first mortgaging the homestead, then failing under intense pressure to support that mortgage (they called themselves “mortgage slaves”) and falling into tenancy—or into sharecropping if in the South—and finally ending where Lincoln’s story began, as dispossessed farm and migrant laborers.

Critics of the U.S. Constitution say it is an instrument of class oppression – made by the rich to the disadvantage of the poor. They deny the reality of separate powers under the Constitution. For them, the inequalities of the market economy must be corrected by government intervention. A century ago Le Bon wrote of the difficulties involved in “reconciling Democratic equalization with natural inequalities.” As Le Bon pointed out, “Nature does not know such a thing as equality. She distributes unevenly genius, beauty, health, vigor, intelligence, and all the qualities which confer on their possessors a superiority over their fellows.” When a politician pretends to oppose the inequalities of nature, he proves to be a special kind of usurper – personifying arrogance in search of boundless power. Logically, the establishment of universal equality would first require the establishment of a universal tyranny (a.k.a., the dictatorship of the proletariat). A formula for doing all this was worked out in the nineteenth century, and was the program of Karl Marx. Le Bon warned that socialism might indeed “establish equality for a time by rigorously eliminating all superior individuals.” He also foresaw the decline of any nation that followed this path (i.e., see the Soviet Union). Such a society would aim at eliminating all risk, speculation and initiative. These stimulants of human activity being suppressed, no progress would be possible. According to Le Bon, “Men would merely have established that equality in poverty desired by the jealousy and envy of a host of mediocre minds.

Professor Joseph Stiglitz, former Chief Economist of the World Bank, and former Chairman of President Clinton's Council of Economic Advisers, goes public over the World Bank’s, “Four Step Strategy,” which is designed to enslave nations to the bankers. I summarise this below, 1. Privatisation. This is actually where national leaders are offered 10% commissions to their secret Swiss bank accounts in exchange for them trimming a few billion dollars off the sale price of national assets. Bribery and corruption, pure and simple. 2. Capital Market Liberalization. This is the repealing any laws that taxes money going over its borders. Stiglitz calls this the, “hot money,” cycle. Initially cash comes in from abroad to speculate in real estate and currency, then when the economy in that country starts to look promising, this outside wealth is pulled straight out again, causing the economy to collapse. The nation then requires International Monetary Fund (IMF) help and the IMF provides it under the pretext that they raise interest rates anywhere from 30% to 80%. This happened in Indonesia and Brazil, also in other Asian and Latin American nations. These higher interest rates consequently impoverish a country, demolishing property values, savaging industrial production and draining national treasuries. 3. Market Based Pricing. This is where the prices of food, water and domestic gas are raised which predictably leads to social unrest in the respective nation, now more commonly referred to as, “IMF Riots.” These riots cause the flight of capital and government bankruptcies. This benefits the foreign corporations as the nations remaining assets can be purchased at rock bottom prices. 4. Free Trade. This is where international corporations burst into Asia, Latin America and Africa, whilst at the same time Europe and America barricade their own markets against third world agriculture. They also impose extortionate tariffs which these countries have to pay for branded pharmaceuticals, causing soaring rates in death and disease.

The scheme began to unravel following the Panic of 1873 when railroad investments failed. The bank experienced several runs at the height of the panic. The panic would not have affected the bank if it had been a savings bank, but by 1866, the business of the bank had become…reckless speculation, over-capitalization, stock manipulation, intrigue and bribery, and downright plundering…. In a last ditch effort to save the bank, the Trustees appointed Frederick Douglas as Bank President in March of 1874. Douglass did not ask to be nominated and the Bank Board knew that Douglass had no experience in banking, but they felt that his reputation and popularity would restore confidence to fleeing depositors….Douglas lent the bank $10,000 of his own money to cover the bank’s illiquid assets….Douglass quickly discovered that the bank was full of dead men’s bones, rottenness and corruption. As soon as Douglass realized that the bank was headed towards certain failure, he imposed drastic spending cuts to limit depositors’ losses. He then relayed this information to Congress, underscoring the bank’s insolvency, and declaring that he could no longer ask his people to deposit their money in it. Despite the other Trustees’ attempts to convince Congress otherwise, Congress sided with Douglass, and on June 20, 1874, Congress amended the Charter to authorize the Trustees to end operations. Within a few weeks’ time, the bank’s doors were shut for good on June 29, 1874, leaving 61,131 depositors without access to nearly $3 million dollars in deposits. More than half of accumulated black wealth disappeared through the mismanagement of the Freedman’s Savings Bank. And what is most lamentable…is the fact that only a few of those who embezzled and defrauded the one-time liquid assets of this bank were ever prosecuted….Congress did appoint a commission led by John AJ Cresswell to look into the failure and to recover as much of the deposits as possible. In 1880, Henry Cook testified about the bank failure and said that bank’s depositors were victims of a widespread universal sweeping financial disaster. In other words, it was the Market’s fault, not his. The misdeeds of the bank’s management never came to light.

When a country’s economy is in trouble—when it has a balance of trade deficit, for instance, and when its debts are mounting—and when the currency, therefore, is declining in value because everybody can see that the economy is bad, politicians, throughout history, have found a way of making things worse with the imposition of exchange controls. They run to the press and they say, “Listen, all you God-fearing Americans, Germans, Russians, whatever you are, we have a temporary problem in the financial market and it is caused by these evil speculators who are driving down the value of our currency—there is nothing wrong with our currency, we are a strong country with a sound economy, and if it were not for these speculators everything would be OK.” Diverting attention away from the real cause of the problem, which is their own mismanagement of the economy, politicians look to three crowds of people to blame for the regrettable situation. After the speculators come bankers and foreigners. Nobody likes bankers anyway, not even in good times; in bad times, everybody likes them less, because everybody sees them as rich and growing richer off the bad turn of events. Foreigners as a target are equally safe, because foreigners cannot vote. They do not have a say-so in national affairs, and remember, their food smells bad. Politicians will even blame journalists: if reporters did not write about our tanking economy, our economy would not be tanking. So we are going to enact this temporary measure, they say. To stem the scourge of a declining currency, we are going to make it impossible, or at least difficult, for people to take their money out of the country—it will not affect most of you because you do not travel or otherwise spend cash overseas. (See Chapter 9 and the Bernanke delusion.) Then they introduce serious exchange controls. They are always “temporary,” yet they always go on for years and years. Like anything else spawned by the government, once they are in place, a bureaucracy grows up around them. A constituency now arises whose sole purpose is to defend exchange controls and thereby assure their longevity. And they are always disastrous for a country. The free flow of capital stops. Money is trapped inside your country. And the country stops being as competitive as it once was.

How exactly the debt should be funded was to be the most inflammatory political issue. During the Revolution, many affluent citizens had invested in bonds, and many war veterans had been paid with IOUs that then plummeted in price under the confederation. In many cases, these upright patriots, either needing cash or convinced they would never be repaid, had sold their securities to speculators for as little as fifteen cents on the dollar. Under the influence of his funding scheme, with government repayment guaranteed, Hamilton expected these bonds to soar from their depressed levels and regain their full face value. This pleasing prospect, however, presented a political quandary. If the bonds appreciated, should speculators pocket the windfall? Or should the money go to the original holders—many of them brave soldiers—who had sold their depressed government paper years earlier? The answer to this perplexing question, Hamilton knew, would define the future character of American capital markets. Doubtless taking a deep breath, he wrote that “after the most mature reflection” about whether to reward original holders and punish current speculators, he had decided against this approach as “ruinous to public credit.”25 The problem was partly that such “discrimination” in favor of former debt holders was unworkable. The government would have to track them down, ascertain their sale prices, then trace all intermediate investors who had held the debt before it was bought by the current owners—an administrative nightmare. Hamilton could have left it at that, ducking the political issue and taking refuge in technical jargon. Instead, he shifted the terms of the debate. He said that the first holders were not simply noble victims, nor were the current buyers simply predatory speculators. The original investors had gotten cash when they wanted it and had shown little faith in the country’s future. Speculators, meanwhile, had hazarded their money and should be rewarded for the risk. In this manner, Hamilton stole the moral high ground from opponents and established the legal and moral basis for securities trading in America: the notion that securities are freely transferable and that buyers assume all rights to profit or loss in transactions. The knowledge that government could not interfere retroactively with a financial transaction was so vital, Hamilton thought, as to outweigh any short-term expediency. To establish the concept of the “security of transfer,” Hamilton was willing, if necessary, to reward mercenary scoundrels and penalize patriotic citizens. With this huge gamble, Hamilton laid the foundations for America’s future financial preeminence.

The underlying factor here is the tendency of the security markets to undervalue issues that are involved in any sort of complicated legal proceedings. An old Wall Street motto has been: “Never buy into a lawsuit.” This may be sound advice to the speculator seeking quick action on his holdings. But the adoption of this attitude by the general public is bound to create bargain opportunities in the securities affected by it, since the prejudice against them holds their prices down to unduly low levels.*

Don’t ever talk about the market as if it’s your pal – nobody ever understands the market. The pain of a loss is worse than the pleasure of a profit. Don’t ever take a loss lightly. If you get worried and sleep badly, you’re in trouble already. Forget about the trendy shares of the day. Don’t invest further in a losing situation. Liquidate your position. Even for speculation based on technical analysis I don’t have much time.

Kearney did not go as far in geographic distance as he did in mode of livelihood: although he only went across San Francisco Bay to Alameda County, he went much further in the change of his career, for this erstwhile drayman ended his days as a well-to-do commodity market speculator'4 -the very sort of thing he had so ardently attacked in speech after speech delivered to cheering working men in the sandlots of San Francisco.

The largest threat to freedom, democracy, the market economy and prosperity,' warns Czech president Vaclav Klaus, 'is no longer socialism. It is, instead, the ambitious, arrogant, unscrupulous ideology of environmentalism.' If you doubt the arrogance, you haven't seen that Newsweek cover story that declared the global warming debate over. Consider: If Newton's laws of motion could, after 200 years of unfailing experimental and experiential confirmation, be overthrown, it requires religious fervor to believe that global warming--infinitely more untested, complex and speculative--is a closed issue.

A man must know himself thoroughly if he is going to make a good job out of trading in the speculative markets. To know what I was capable of in the line of folly was a long educational step. I sometimes think that no price is too high for a speculator to pay to learn that which will keep him from getting the swelled head

I have been in the speculative game ever since I was fourteen. It is all I have ever done. I think I know what I am talking about. And the conclusion that I have reached after nearly thirty years of constant trading, both on a shoestring and with millions of dollars back of me, is this: A man may beat a stock or a group at a certain time, but no man living can beat the stock market! A man may make money out of individual deals in cotton or grain, but no man can beat the cotton market or the grain market. It's like the track. A man may beat a horse race, but he cannot beat horse racing

I used a combination of my brand sentence and my three buzz words to create the title and tagline for my author website, which is “The Hidden World of Melissa Storm: Author of Sweet, Speculative Fiction for Women.

The term ‘democracy’ can have two kinds of meaning. It can refer to ways of making effective claims for a more just and egalitarian common world. Or it can refer to a mode of governing populations that employs popular consent as a means of limiting claims for greater equality and justice by dividing up the common world. Such limits are formed by acknowledging certain areas as matters of public concern subject to popular decision while establishing other fields to be administered under alternative methods of control. For example, governmental practice can demarcate a private sphere governed by rules of property, a natural world governed by laws of nature, or markets governed by principles of economics. Democratic struggles become a battle over the distribution of issues, attempting to establish as matters of public concern questions that others claim as private (such as the level of wages paid by employers), as belonging to nature (such as the exhaustion of natural resources or the composition of gases in the atmosphere), or as ruled by laws of the market (such as financial speculation). In the mid-twentieth century, this ‘logic of distribution’ began to designate a large new field of government whose rules set limits to alternative political claims: the field that became known as ‘the economy’.

Mussolini and Hitler also felt that they were doing things along similar lines to FDR. Indeed, they celebrated the New Deal as a kindred effort. The German press was particularly lavish in its praise for FDR. In 1934 the Völkischer Beobachter—the Nazi Party’s official newspaper—described Roosevelt as a man of “irreproachable, extremely responsible character and immovable will” and a “warmhearted leader of the people with a profound understanding of social needs.” The paper emphasized that Roosevelt, through his New Deal, had eliminated “the uninhibited frenzy of market speculation” of the previous decade by adopting “National Socialist strains of thought in his economic and social policies.” After his first year in office, Hitler sent FDR a private letter congratulating “his heroic efforts in the interests of the American people. The President’s successful battle against economic distress is being followed by the entire German people with interest and admiration.” And he told the American ambassador, William Dodd, that he was “in accord with the President in the view that the virtue of duty, readiness for sacrifice, and discipline should dominate the entire people. These moral demands which the President places before every individual citizen of the United States are also the quintessence of the German state philosophy, which finds its expression in the slogan ‘The Public Weal Transcends the Interest of the Individual.’ ”38

The line separating investment and speculation, which is never bright and clear, becomes blurred still further when most market participants have recently enjoyed triumphs. Nothing sedates rationality like large doses of effortless money. After a heady experience of that kind, normally sensible people drift into behavior akin to that of Cinderella at the ball. They know that overstaying the festivities — that is, continuing to speculate in companies that have gigantic valuations relative to the cash they are likely to generate in the future — will eventually bring on pumpkins and mice. But they nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There’s a problem, though: They are dancing in a room in which the clocks have no hands.

The factors that determine activity on the Exchange are innumerable, with events, current or expected, often bearing no apparent relation to price variation. Beside the somewhat natural causes for variation come artificial causes: The Exchange reacts to itself, and the current trading is a function, not only of prior trading, but also of its relationship to the rest of the market. The determination of this activity depends on an infinite number of factors. It is thus impossible to hope for mathematical forecasting. Contradictory opinions about these variations are so evenly divided that at the same instant buyers expect a rise and sellers a fall. The calculus of probability can doubtless never be applied to market activity, and the dynamics of the Exchange will never be an exact science. But it is possible to study mathematically the state of the market at a given instant- that is to say, to establish the laws of probability for price variation that the market at the instant dictates. If the market, in effect, does not predict its fluctuations, it does not assess them as being more or less likely, and this likelihood can be evaluated mathematically.

While Soviet political leaders held certain assumptions about trade, notably that the profit-driven capitalist market was evil and the resale of goods for more than the purchase price constituted a crime (“speculation”), they gave little advance thought to what “socialist trade” might mean.

Many complex elements contributed to the Great Depression of 1929. However, most economists believe that the two main causes of the Depression were the immensely uneven distribution of wealth during the previous decade and the extensive speculation in stock that took place in the latter half of the decade. The decade preceding the Depression was a time of tremendous prosperity and became known as the “Roaring Twenties.” However, prosperity was not for everyone. The number of wealthy people in the country was less than a tenth of a percent of the total population yet they controlled most of the money in the country. In a well-functioning economy, demand must equal supply. But in 1929 wealth was so unevenly distributed that the supply of products far exceeded the demand for them. People may have wanted the products at the time but they couldn’t afford them. If supplies keep building and demand lessens, the economy can collapse. One way to balance the equation is to allow people to buy products over time. By the end of the Roaring Twenties, over 60 percent of all automobiles and 80 percent of all radios had been purchased on credit. With this new influx of money into the market, the economy was booming at the end of the 1920s. Stock speculation became rampant. Profits as high as 3,400 percent could be made in less than a year and people could buy on margin. In other words, they only had to put down 10 percent cash when buying a stock. Because of this, everyone was buying stocks. The poor were equal players with the rich. This buying spree pushed the market to new highs. In 1928 alone the Dow Jones Industrial Average rose from 191 to 300. There were warning signs as minor recessions occurred in the spring of 1929. Investors became nervous. In October people started selling their shares of stock. As the market started dropping, more and more people sold stock, margins were called, and by October 1929 there was panic selling. Stock prices dropped so fast that many rich people became poor in a matter of hours.

In the aforementioned Intellectual Birdhouse, which focuses on artistic practice as research, Michael Schwab examines the role of the artists' artist and, in doing so, extends Foster's reflections when discussing 'love value' over exchange value. Drawing on the work of Bourdieu among others, Schwab describes what values the new archival context suggests for institutions that are looking to recoup their losses: "the 'artists' artist' is too epistemologically demanding on the market, which fails to capitalize (often during the lifetime of the artist) on the symbolic value that is produced while he or she delivers epistemological gain to his or her peers, who appear to be the only ones who are able to perceive such value in advance of the market." Schwab is arguing that the role of the artist in the production of knowledge through artistic research extends and can be differentiated from symbolic value. It is not the market that distinguishes the value of an artist to the artist, it is their epistemic value. In other words, it is what we can learn from that artist, not just their artworks. This produces a dilemma for the established institution that struggles to identifY the cultural significance and value of the 'artists' artist' until late, sometimes too late, in the lifetime of the subject. It is not necessarily just a lack of vision on the part of museum staff, archivists and curators, but the values these institutions are increasingly forced to place on spectacular exhibitions in order to survive through corporate and media driven sponsored relations. Archivists themselves acknowledge this limitation of working within institutions that have little room to speculate on cultural value except through established forms, such as the emerging contemporary markets. Many seek out and must work in new emerging archives, such as Flat Time House. However, I would also argue that it is the artist's understanding of the potential value of' 'becomingness' through cultural capital that applies to the present moment too. As has been stated by Derrida, the 'vision' to see what needs to be archived is now the work of the artist/s: to anticipate the archive itself. (excerpt from Experiments and Archives in the Expanded Field written by Neal White)

These words [bullish, bearish] are not in my vocabulary because I believe they can create an emotional mindset of a specific market direction in a speculator’s mind.” — Jesse Livermore

Buffett also teaches investors that there is one important caveat to the multiyear test: Underperformance in the late stages of a speculative bull market is highly likely. It’s a caveat that he repeats to this day. We

never try to predict or anticipate. I only try to react to what the market is telling me by its behaviour. I believe there are no good stocks or bad stocks; there are only money making stocks. So there is no good direction to trade, short or long; there is only the moneymaking way to trade. Greed, fear, impatience, and hope will all fight for mental dominance over the speculator.” — Jesse Livermore

for the stock market, corporate earnings and dividends; for the bond market, interest payments. Market returns, however, are calculated before the deduction of the costs of investing, and are most assuredly not based on speculation and rapid trading, which do nothing but shift returns from one investor to another. For the long-term investor, returns have everything to do with the underlying economics of corporate America and very little to do with the mechanical process of buying and selling pieces of paper. The art of investing in mutual funds, I would argue, rests on simplicity and common sense.

Gold belongs only in the portfolios of fearmongers and speculators. If you own gold in your portfolio, expect to not get paid an income, pay higher taxes on your returns, take a more volatile ride than the stock market, and get a long-term return lower than bonds.