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NCBA Deserves an ATTA-BOY

RobertMac

Well-known member
Sandhusker said:
RobertMac said:
If we were free to do as we please, God would not have given us the Ten Commandments.

I don't think the financial markets are a good example to go by. I think (and I realize my opinion is ignorant) that the financial and commodity markets are out of control.

How much of the run up in oil prices is based on actual conditions(fundamentals) as opposed to purely speculator driven?

The same for grains...how much of these prices are based on today's supplies vs. the speculation of problems in the coming growing season?

Is a company's stock based on the company's worth or what speculators believe?

Speculators make money on volatility of the market and being on the right side of that volatility at the right time...does their actions reflect the real world?

As I said, I'm more ignorant than knowledgeable on the markets...so someone please explain it to me!

Anything's value is only what you can get for it. My point is to look at the New York Stock Exchange; The NYSE is very concerned about transparancy and fairness. They realize how market power can be gained by size and how that power can be used against others. They don't want that in their markets, they want a fair shake for everybody. Thus, they have a number of rules that are based on who you are, how big you are, etc..., and those rules work! The NYSE is a model of fairness. Anybody can buy 1 share of stock and be assured that all is being done that can to make sure the guy that has a million shares can't hose that little guy over just with that size.

This is what some people are trying to do in the cattle markets. The money should be made and lost on business savy, not just because you used your weight to lean on people, like it is now. The markets should move on supply and demand, not because one entity has inside information and the market power to use that inside information.

I agree with most everything you said here, but here is what I'm looking for...
If a marketing fund has a large holding of a particular stock and that stock reaches a 'sell' trigger point....then when the stock drops because of this sell and then triggers other funds to 'computer sell' and the company's stock takes a free fall. How is this reflective of the company's real world financial condition? Granted these trades are open and transparent, but does the company and the small stockholder still get a "fair shake"?
 

Sandhusker

Well-known member
RM, "I agree with most everything you said here, but here is what I'm looking for...
If a marketing fund has a large holding of a particular stock and that stock reaches a 'sell' trigger point....then when the stock drops because of this sell and then triggers other funds to 'computer sell' and the company's stock takes a free fall. How is this reflective of the company's real world financial condition? Granted these trades are open and transparent, but does the company and the small stockholder still get a "fair shake"?"

First of all, there is a certain threshold of ownership where you have to register your intentions to buy or sell even before you do it so that everybody get's fair warning that a big boy is moving. I forget, but I think it's something like 5% (compare that to Tyson's 33% that is unrestricted).

Let's say someone under that threshold starts selling and that leads into program stops for other funds. You can't stop that, but you can see it happening and do something. There's a number of free places on the net (Yahoo Finance is a good one) where it not only shows the price of the stock, but also the volume. If you see a stock moving down on a lot of volume, you know exactly what is going on and you can react. That information is available to everybody - everybody can see what any % of the market is doing. Again, compare that to the cattle markets where Tyson is the only one who knows what 33% of the market is doing.

Because of the technology available to everybody, I do think the NSYE participants do get a fair shake. You can't insulate anybody from big market swings, but everybody has access to the same information and can act accordingly.
 

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