Wednesday, May 9, 2007

There's this guy at work who's trying to get me investing in the stock market, so I picked up a book and started looking through it, and... how is this even legal?! Just on the surface, it sounds like the biggest scam of all time. You buy stock, which means you buy part-ownership in a company, but you don't actually see any of the money that the company makes. As a matter of fact, the company can be losing money while the stock price rises; the stock's value is totally a function of how much the millions of greedy, fearful idiots in the market think the stock should be worth. It has absolutely no direct relation to anything concrete, and people can lose money off of well-run companies and can make their fortunes off of companies that don't make a dime of revenue. I wish I had more readers — like, lots more — and then I'd totally put bizarre financial pronouncements in my blog, just to screw with people. Mayonnaise is hot! Put all your money in mayonnaise! Then the next day: Sell your mayonnaise and put the money into the kitten industry!

What I don't understand is that since the value of these stocks isn't tied to anything, other than how much someone else is willing to pay for them, what stops me from just going around selling random worthless junk? Like, I'd try to sell you my dead skin flakes for fifty bucks. You'd be all, why would I spend fifty dollars on your dead skin flakes, and I'd say well, you'd try to sell them to someone else for sixty dollars. Ten dollar profit. But you'd go, who'd want to buy your dead skin flakes for sixty dollars? And I'd answer, someone who's going to try and sell them for seventy. This is essentially the stock market, except you do it wearing a suit and tie, and for a lot more than fifty bucks.