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Musicmystery -> RE: Imagine there's no stock market... (6/4/2010 11:24:12 AM)
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Again, you are talking about the monetary system and manipulation by those with power.
Let's say we do away with the stock market, do away with the Fed, in fact, do away with money.
What would happen? First, liquidity of trade would drop and transaction costs would rise. People would find ways to facilitate their dealings and to store value, and those facilitations would become money, whether coffee beans, credits, salt, scrip, gold, shells, whatever. Loans would create money, people would trade their stakes, and we'd be back to a different version of the same institutions. It comes right back to the fundamentals of money and trade. And even then, people with more resources would have more power, and some would strive to abuse that power and to manipulate trade.
Nor am I troubled about the government's stake, from the Fed to my deed. I'm glad the government has a stake. If not, I'd have to defend all this myself, and before long, people would realize they could just come over and take what I've got. So, I'd have to hire my own army--but my land doesn't produce enough to support an army, so we'd have to go into the business of taking over other people's land too. Hell, I couldn't even be sure my own men wouldn't turn on me--I'd have to quickly become a ruthless warlord, and since there's always a bigger army, I'd have to form alliances with other landlords, and our agreements would become government.
But because the government has a stake, it backs my property rights. I can expect police and even military protection. I can expect the rights to my music and writing. I can expect recourse in the courts. I can also expect the currency to be backed, even if only paper notes and accounting ledgers. Comes back to the fundamentals of government and economics.
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