True News 3: What's Going Wrong in the Stock Market

[QuatFax]

I'm really glad you pointed out that selective tax breaks are a form of government privilege. So many right-libertarians treat all tax breaks as smaller government, not realizing that the government can use tax breaks to give certain advantages to certain people.

[abarford1]

LEGIT QUESTION !!!

Wouldn't the biggest factor in increased turnover in the US stock market be from foreign investement ??

[leopodstanicky]

I like this very clear-cut analysis - problem is that US have thousands of economists who are used for to get us all in trouble - what can we do about it? Yes, nothing. But a very good vid indeed thx leo

[vladimiros95]

great, great work man keep on!!!!

[TheCeejReturns]

Maybe it's just my ignorance in the subject, but couldn't the problem with futures be solved tomorrow if you couldn't cash out your futures? If you could only trade the future value for what the future is for? For example, if you bought $500 in wheat futures, then it later became worth $750 and you wanted to cash out, you had to go home with $750 worth of wheat rather than cash?

[MrHeiwa07]

My GOD Stef, if I only watched this video 2 years ago I could have saved so much money. Fortunately I`m still young and I`m still working :-)

[alistairproductions]

i have a headache and i know the government planted it in my head

[BenettFreeman]

Yes legislation and monetary policy have distorted the stock market, but fundamentally the stock market is complete and utter madness. The idea that someone can create tangible, real values for himself purely by the exchange of remote values on behalf of people they will never meet, is f-ing bonkers

[LordAgonis]

@BenettFreeman Madness is the lack of risk-adjusted values in the stock market under the clearinghouses.

[BenettFreeman]

Yes legislation and monetary policy have distorted the stock market, but fundamentally the stock market is complete and utter madness. The idea that someone could work as a "trader" in non-realtime commodities is completely anathema to rational life

[Surhotchaperchlorome]

12:29 -- Madness?

THIS IS SPARTA!!!

I'm sorry, I couldn't resist.

[bootayjam]

Great video Stefan, please keep up the good work. I'm doing my best to show these videos to my friends, but you know, most people are content being cows and want to keep chewing the cud.

[Zen5012]

That's exactly what's always bothered me; I look at the 401(k) reports I get and it lists companies that I 1) Didn't even know they existed and 2) The names don't mean anything.

I would love to take my extra money and give it to Matt's Rifle Shop to help Matt out and let him grow. "Black Hills Financial", "Westlake Finance", "Cypress Investments" - what are these people? Do I believe in their mission? Do I know, understand and care about what their employees do day to day?

Hell no.

[hazywho]

GDP vs total dollars in stock market does not take into account overseas investment. The dollar is an especially bad example because of the world trade surplus that exists denominated in dollars. Granted, this surplus exists in part due to fiat currency. Multi-national companies and other nation states investing their non US 'GDP' in the US market in dollars must be taken into account. The graph must be put into these terms to be true.

[mikeybrumbrum]

The problem is, that the govt are claiming that since they can't in a 3 minute statement, explain whats happened, or even summarize it properly, then they cant explain it, at all. We dont need to knwo, cus we're too stupid to understand.

However, we are not stupid, and can see their disshonesty, as the most probable "cloak", which covers the truth of our perils.

Personally, I believe that the Mafia is th evatican, and the freemasons are the Royals, and they both feed off us, liek vampires.

[mikeybrumbrum]

The only way the rich people (all of them, from police to Lords) can keep their power, is by TAKING all the money, from all the rest of us.

They will subject us, to whatever form of govt, we will accept.

Then they will continue to wrap themselves around us, and slowly pin us into our own homes, with no way of leaving.

Then they will gas us, or something.

This is th enatural progression, if htings carry on, as they are, as far as I can see.

Close your eyes, and project the behaviour of cops.

[whatrugonnadocrazy]

hey everyone, what does that metaphor mean in relation to the stock market?

thanks

[IgnoranceIsNoExuse]

Chickens = massive amounts of money thrown/forced into the stock market by the gov, etc.

Chicken coup = stock market

That's my understanding, anyone feel free to correct me if I'm not understanding the metaphor properly.

[ambj219]

I took money and banking in college, so i caught most of your fastballs, but a few flew over the Cuckoo's nest, just a few-- for me. Another great one.

[Frettsy]

"If you force people to gamble, casinos would get huge and weird"

lol.

[StandUp555]

Excellent work .... best explanation of what's going on that I've seen for years !

Thankyou !

[mikeybrumbrum]

And the choice of the middle classes will soon be:

Do we side with the people, or the bankers. And if you side with the bankers, YOU will become the working class. We are coming ot the stage, where millions of us are looking for new ocuntries or ANYWHERE away from these viel cities, which treat us, and call us cattle,

Men in black capes earn a year of my wages to persecute a child for pessession of a tiny amount of weed.

20 people profit form his suffering, and we are getting angry.

[mikeybrumbrum]

Whichever bullsht they gove us about rules, regulations, whatever, it is basically this:

They Play, We Pay !

And its a "fluid" system, so it changes to suit THEIR needs, at all times, regardless of th cost ot us.

In serious fact, they ENJOY puttin gmore fictional "mental" debt on us, so that we constantly feel we "owe" them something (therefore we are more likely to pay them something).

But it will NEVER work for the people.

NO uncontrolable govt will EVER work for the people. EVER !

[Falco4e]

ANY GUYS UP?

just moved new area yk

[datalorez]

Von Mises!!!

I love you

[namename654]

"The socialization of risk, and the privatization of profit."

Wow, hit the nail right on the head.

[vegnagunL]

Again blaming the government!? This is a joke.

The FED US central bank is PRIVATE. Funny how u didnt mention that.

The governemnt around the world are only injecting money into the system to save the damm corporations.

You need to do your homework to understand how the big corporations control the governemnt. They pay for the capaingns of the elected liders.

[lpszOxFFFF]

"Again blaming the government!?" The gov vs private business is a false dichotomy in the US. Often the same oligarchs who are captains of industry get in gov to advance their own business agenda. The Commerce Dept, Treasury and the FED are known to serve the narrow interests of the FIRE sector of the econ (Finance Insurance & Real Estate) regardless of what party appointed them. What's true however is that gov bashing is a propaganda tool to discredit the idea of gov via progressive taxation

[vegnagunL]

lol im not defending the government.... i agree with you....

But the government is not the enemy, they are simply a tool... so that we blame the wrong person...

[FjordLynn]

One more thing to consider with this model is the effect of the widthdrawl of the capital from the market as the boomers retire. This is, of course, part of the reason why the government wants to "privatize" part or all of the social security money. It's another step in the shell game to prop up the phantom values.

[Insomniatoh]

Thanks! This question may have been brought up somewhere else, but I'd like to confirm this: Why is the govt so intent on pumping all the money obtained from 401k plans into the stock market? I'm guessing that it is to earn more money through speculation, since they don't have any means other than taxation and printing money.

[HomeBoyCharlotte]

"hy is the govt so intent on pumping all the money obtained from 401k plans into the stock market? I'm guessing that it is to earn more money through speculation, since they don't have any means other than taxation and printing money."

I think you're exactly right. at 8:46 he explains alittle to your question

[23Memes]

very interesting video, thanks for shedding some more depth on this situation

[jjnature]

Thank you very much.

[errorspending]

Also, why is it that it seems only one man in the entire world is actually telling the truth and working things out logically? How can no one else be releasing videos like this???

[HaoLong07]

Uh, I'm sure you can find plenty of other people. This guy just does it as his life's calling.

[errorspending]

What I wanna know is do you actually have suit pants on too Stef? I mean we can't see your bottom half so why bother :).....sorry just trying to get used to the new look ;-)

[mindprism]

Succinct and unimpeachable. Thank you.

[abacus000000]

You may not read this but I felt compelled to say it. Keep on doing what you do! Very insightful information.

[stefbot]

Thanks :) I read all the comments, the listeners are so brilliant!

[axg7279]

Nice.........

[gnu11111]

Seems like Ludwig von Mises is on his way to be the Karl Marx of the 21th century. What do all the hard-core communists say today: "The system itself is working, only the real-life manifestations of communism were all wrong". They were wrong, because they depend on "good" people, who act in a "good" way for the whole society.

Same thing happens now with free markets... the system itself is working, only the real-life manifestations are all wrong, because capitalism depends on "good" people...

[jupiterjjrm]

So true.

[Moragauth]

Care to point out how a heavily regulated market system is free market? Or are you just trying to make cute little rhetorical points? I think I know the answer...

[gnu11111]

This is the first time I hear about an overly regulated financial market in a very long time. Is there any scientific publication you are referencing to or is it just a personal assertion out of the blue?

[Moragauth]

Perhaps because most people just like chanting the "deregulated markets" bullshit meme? One does not even need a "scientific" publication; one only need look at all the gov't bodies and regulations in place.

mises[dot]org/story/3120 That lists just a few of the regulations in the US' "unregulated" financial markets. Unregulated my ass.

[StrafingMoose]

All designs of governance expect politicians to act like chemical agents or mathematical formulas; not driven by self-interest. That is why we cannot afford governement at all if you are interested in peace, prosperity and all these nice things. That is pretty much what Mises was saying. He was not proposing another design of governance.

[gnu11111]

That was my original point. Mises' ideas will go down the drain just like Marx' ideas did a 100 years ago. Both systems can easily be exploited by only a few destructive people in power.

The basic problem is, that we still are thinking in tribes and there are no social systems that work well for more than 50 to 100 people. Trying to form a coherent collective involving hundreds of millions of people and call it "one country" is mind-boggling megalomania.

[Moragauth]

It is, which is why Mises had no such ambitions.

[mikepeino]

Actually the free market is a system based on the assumption that individuals will act in their self interest. In the absence of violent intervention that also works to serve others. In fact it is all statist ideologies that depend on violence that assume the need for "good" people, or "the right people in charge". The real life manifestations are all distorted by violent state intervention. That's what Stef is trying to point out with these videos.

[do1o]

What?

1. The fall of the Sowjet Union was a nice example of the flaws of Socialism, but is in no way a proof. You just don't have controlled experiments, where you can isolate one variable when you view whole societis.

Marxism isn't wrong because self-proclaimed "communist" countries are doing crappy. Marxism is wrong because it fails in theory.

[do1o]

2. Nobody today knows Mises or his work and certainly no politian follows his policies, which would be the end of their job. The most in academia are references of Hayek. The whole system whe have today is everything Mises fought against his entire life, he would call it "Zwangswirtschaft". I recommend his article:

"Middle-of-the-Road Policy Leads to Socialism"

(Just google it)

[gnu11111]

Sorry, but I've heard that all before. Marx would have hated Stalinism, the politicians got him all wrong, it was never "real" communism, yadayada. I hate that fanboy stuff.

[DixyHair]

Maybe because it wasn't real communism. Would you use Nazi Germany as an example of how democracies fail?

[gnu11111]

Nazi Germany was a fascist dictatorship, a totalitarian one-party-system. You've got a lot to learn, oh boy.

[jetsamjetsam]

Fascism derives from Democracy because only from a establish Democracy can a Fascist state thrive. This is because of the people supporting the government and Fascism needs the people's support.

But overall, I like this video, learned a lot.

[gnu11111]

1. you fail for not knowing the difference between socialism and communism.

2. every market based on fiat currency fails in theory and in practice. when it's regulated, it lasts a bit longer till it crashes, that's the only difference.

[DixyHair]

Free markets aren't based on fiat currency.

[gnu11111]

read my second point again, lean back and try to understand it.

[lukeev]

Magnifico!

[tiko2114]

well all of a sudden i dont feel so good about my pending finance degree.

[Trandofir]

Great video. Just a side note though, nothing to do with the video, but voting at podcastawards starts on the 23rd Oct. 2 Days! So I don't know if you want to make a "Go and vote" video, just a heads up.

[TruthHidden]

Great points. This current "market" setup is corporate fascism at it's finest.

[Enhorn]

Silence!

I concur... :-D

[ARCHETECTONIC]

Stef - listen to me!! - I know when your making these video's you're probably sometimes frustrated thinking, 'well, who cares??' - just remember that your videos are very, very important to me, and no one i knows is explaining problems that are so relevent so clearly - i think youtube was designed or is at least best suited precisely for people like you to educate people like me - thanks. Keep it up.

[kvan1917]

Mmmm, chicken...

[D4Shawn]

I'm feeling a bit overwhelmed by our task.

Z statist explanations are always simple and based off of one little factor/idea (i.e. "Zis all happened because of deregulation. Zerefor, we need more regulation."), and zey are echoed throughout z entire culture (thanks to mass communication [especially "mainstream" media]), whereas we're but a few voices here and zere trying to explain something far more complicated zat seems to require endless study just to keep pace with z propaganda mill. :/

[simonodell]

the suit makes you look like one of them...

[dover1982]

You can look professional without being "one of them" simonodell. I like the suit lol. I love these types of videos too, just like his "House, MD" video.

[simonodell]

It was a joke, but tbh I am rather cynical of humanities penguin-suited faction. In my experience the only people who wear suits are trying to sell you something.

Along the same lines of argument stef himself used; a suit doesnt make someone a professional any more than another suit makes murder moral.

A suit therefore is used to either to conform to a coercive "norm" or expressly to decieve, because sheeple have more respect for a man in a suit because of the "impression" it creates.

[dover1982]

Oh you're both right that wearing a suit doesn't make you more professional, but it does make you look more professional that's all. It deosn't really matter for a youtube videoi, but in general, in our society, image is unfortunately often more important than what you really are.

[simonodell]

Absolutely, the suit is like a uniform, a symbol of conformity to the very way of thinking which is ruining this world. Can you imagine a politician getting elected without wearing a business suit? How ironic that the populace would deem such a person as less trustworthy than the shifty fellow who wears a special outfit to impress them into liking him.

[overmind25]

Much better than the Real News.

[iorbit]

This is realer

[Mahoivlich]

keep em coming Stef. i love the new format.