have you seen stock market these days?

The stock market isn't fundamentally a gamble. Spending money to buy a share of a company's future dividends is a sound way to invest money and earn a return on it.

The problem with the stock market is when there aren't enough new companies going public to soak up the spigot of all the capital that people want to invest, leading average P/E ratios to increase over time. There is too much money chasing too few earnings. When the underlying fundamentals don't match up, then all that investors are doing is speculating that someone else will be the bigger fool and buy from them at an even more unreasonable price - and that is a gamble.

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Avshalom 2 hours ago | parent | prev | next [-]

Yeah, we hate that too man. It's just not the topic at hand.

	▲	azan_ an hour ago \| parent \| next [-]
		Why do you hate it? It’s a great way for average person to get share in the profits of giant corporations.
	▲	Helloworldboy 2 hours ago \| parent \| prev [-]
		[dead]

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Avicebron 2 hours ago | parent | prev | next [-]

Is the stock market able to distinguish cancerous vs non-cancerous growth?

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amelius 2 hours ago | parent [-]

Well, long term trading is what we should stimulate because it corresponds to investments based on insights in the underlying companies.

Short term trading, however ...

Maybe we should just put limits on how short one can own a stock (?)

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bluecalm 2 hours ago | parent [-]

You want short term trading because you want the prices to be as close to efficient as possible. You may never trade short term but at some point you are going to buy and at some point you are going to sell. Market being far from efficient one would hurt you there. So let them trade and discover price. You don't have to play that game but you still benefit.

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amelius 2 hours ago | parent | next [-]

How much will it hurt me? Maybe I'm OK with being hurt through the markets if it means the world is a saner and more fair place?

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orangecat an hour ago | parent [-]

Ok, and how does banning short-term trading make the world more fair?

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amelius an hour ago | parent [-]

For one thing because now people who own high-speed low-latency connections to stock markets have no advantage over "normal" people who actually do meaningful work, like being a policeman or nurse.

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azan_ an hour ago | parent | next [-]

Price discovery and increasing liquidity is meaningful work.

	▲	amelius an hour ago \| parent [-]
		To a very limited extent, maybe.

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logicchains an hour ago | parent | prev [-]

>people who actually do meaningful work, like being a policeman

Making a sudden event that happened on the other side of the world reflect in the local market price at almost the speed of light is far more meaningful work than going around shooting dark-skinned people.

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ambicapter 2 hours ago | parent | prev | next [-]

Long-term traders don't need the price to be as "efficient" as possible by definition.

	▲	orangecat 2 hours ago \| parent [-]
		Maybe an extra 1% spread doesn't matter if you buy and hold for 50 years, but for 2 years it absolutely does.

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cyberax 2 hours ago | parent | prev [-]

> You want short term trading because you want the prices to be as close to efficient as possible

But do I want the prices to be as efficient as possible?

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amelius an hour ago | parent [-]

If this whole efficiency argument means I'm going to make $1 more per month while some lousy traders make $100k more per month, then I'd say: to hell with "efficiency". Fairness and wealth equality are more important to me than $1.

Also considering that these traders will use their $100k in ways that my $1 will become worth even less. For example by buying all the housing in my neighborhood and thereby increasing my rent.

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logicchains an hour ago | parent | next [-]

Without that efficiency it'd be like the old days before electronic trading where you're paying 100x larger fees to a crusty old brokerage any time you want to trade.

	▲	amelius an hour ago \| parent \| next [-]
		Doesn't matter. Banning short term trading will also reduce # trade events, so the fees don't matter.
	▲	cyberax 27 minutes ago \| parent \| prev [-]
		Why would the fees be bigger? The old brokerages had to do manual work to put the bid on the trading floor. Electronic trading doesn't need to go away. The trade itself might take some time instead of being functionally instant, but that's fine.

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azan_ an hour ago | parent | prev [-]

It’s amazing how successful populism is, even HN is now full of populistic comments.

	▲	amelius 30 minutes ago \| parent [-]
		What makes your comment better or less "populist" than mine? What does populism even have to do with it?

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cdrnsf 2 hours ago | parent | prev [-]

Yes. It feels more and more like a casino as time goes by.

	▲	dominotw an hour ago \| parent [-]
		would love to see if there is any data if stocks are more volatile now for ai related stocks