Kat Hak Sung
Save stock market with your pension
Mon May 23, 2005 18:50
207.200.116.137
3. The stock price depends on the amount of investment fund.
If monthly trade stock is 100 shares, ($1.00 each) the investment fund in that month is $110, then the share price will be 1.10 each, it's a 10% rising market. If there is only $90 fund go into the market, then the price will be $0.90 each. A falling of 10%.
More fund is needed to support a growing up market. A $100 market grew up 10% in first year with $110 investment.Next year, to support a $110 market growing another 10%, you need $121 new investment fund. And $132 for the third year..... To blow a ballon bigger, you need more air.
For decades, the index of US stock market went upwards. It created a fake phenominon that if you invest in long term, (e.g. 40 years) you got a good return. That's the justification someone like Bush used.
But if you know the above principle(a rising market depends on increasing investment fund) you must know that it was built up artificially. The US stock market growing up at public's pension fund. At first, Different pension fund push up the stock market. Then financial group created mutual fund in 1970s(?) which put your savings into the stock market. When it was not enough they invented "IRA" in 1980s which push another amount of retirement fund into the stock market. Further more, in 1990s, government allowed 401(k) to access the stock market. Wave after wave, Americans' retirement money were pushed into that gambling market. It became a big bubble.
But money was harvested by company and winners already. What public held are only a bunch of papers. When people want to cash their 40 years long savings, (they think they have a bunch of treasures, but that's only a paper value) Who has the ability to take over that big bubble? It needs a lot of new investment fund to support it.
That's why when government exhausted your money by "pension fund investment", "IRA", "401(k)" the last exit is your social security
If monthly trade stock is 100 shares, ($1.00 each) the investment fund in that month is $110, then the share price will be 1.10 each, it's a 10% rising market. If there is only $90 fund go into the market, then the price will be $0.90 each. A falling of 10%.
More fund is needed to support a growing up market. A $100 market grew up 10% in first year with $110 investment.Next year, to support a $110 market growing another 10%, you need $121 new investment fund. And $132 for the third year..... To blow a ballon bigger, you need more air.
For decades, the index of US stock market went upwards. It created a fake phenominon that if you invest in long term, (e.g. 40 years) you got a good return. That's the justification someone like Bush used.
But if you know the above principle(a rising market depends on increasing investment fund) you must know that it was built up artificially. The US stock market growing up at public's pension fund. At first, Different pension fund push up the stock market. Then financial group created mutual fund in 1970s(?) which put your savings into the stock market. When it was not enough they invented "IRA" in 1980s which push another amount of retirement fund into the stock market. Further more, in 1990s, government allowed 401(k) to access the stock market. Wave after wave, Americans' retirement money were pushed into that gambling market. It became a big bubble.
But money was harvested by company and winners already. What public held are only a bunch of papers. When people want to cash their 40 years long savings, (they think they have a bunch of treasures, but that's only a paper value) Who has the ability to take over that big bubble? It needs a lot of new investment fund to support it.
That's why when government exhausted your money by "pension fund investment", "IRA", "401(k)" the last exit is your social security
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