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I'm pretty sure I read about this from this HN before. Take for example the story of the 15 year old that found out how to drum up stocks and turn a profit and

by TGJ 16y ago

I'm pretty sure I read about this from this HN before. Take for example the story of the 15 year old that found out how to drum up stocks and turn a profit and the SEC barely does anything when they find out because they don't want the public to learn about the practices on Wall Street. http://www.cs.brown.edu/~rbb/risd/Lebed.html http://www.cs.brown.edu/~rbb/risd/Lebed.html

blehn 16y ago
Thanks for sharing that article. The kid's letter to his lawyer was remarkably clever. If it wasn't for everybody manipulating the market, there wouldn't be a stock market at all...
jrockway 16y ago
That's a pretty dishonest characterization of the article. It is a case of the government taking a settlement because they are afraid of losing in court, but everyone knows that stock prices are artificial and that the media can manipulate them. That's why I don't get the recent anti-speculation sentiment. The stock market was never about value-investing, it's about speculation. Everything is speculation -- when you put money in a CD, you are speculating that the bank is not going to become insolvent and lose your money (and that the insurer is also not going to become insolvent). That's why you get the interest rate premium over treasury bonds. Now, you may argue that you're less likely to lose money in your savings account than in betting that Google will drop to $1 a share, and you're right... but it's all about degrees. Every decision you make is speculation. The market is all speculation, either people speculating, or people's algorithms speculating. Nothing more.
- mistermann 16y ago
  Really? So all the explicit rules and regulations about disclosure, etc that participants in the stock market must adhere to are not actually binding? Everything is just a big crapshoot? Sadly, your assessment is just about bang on of how it actually is. What people are complaining about is that it is advertised as something else. After the whole Bre-x scandal, there are now very strict rules on stating mineral resources. However, you can adhere to those rules, get money from investors to fully develop a mine and mill, and then sell the company for ten cents on on the dollar to a cayman islands based company, and the regulators won't bat an eye, even when you do most of the legwork for them. You seem to talk as if the markets have always been rigged. It was not always like this. Of course there were always indiscretions here and there, but the way it is now is just ridiculous.
  - jrockway 16y ago
    So all the explicit rules and regulations about disclosure, etc that participants in the stock market must adhere to are not actually binding? Everything is just a big crapshoot? Yup. Because although the disclosures are correct, nobody reads them. They invest with their gut or their own metrics. (Someone who posts to HN regularly likes to claim that certain shapes in the EURJPY graph mean the whole world economy is going to collapse, for example.)

by TGJ 16y ago

blehn 16y ago

Thanks for sharing that article. The kid's letter to his lawyer was remarkably clever. If it wasn't for everybody manipulating the market, there wouldn't be a stock market at all...

jrockway 16y ago

That's a pretty dishonest characterization of the article. It is a case of the government taking a settlement because they are afraid of losing in court, but everyone knows that stock prices are artificial and that the media can manipulate them. That's why I don't get the recent anti-speculation sentiment. The stock market was never about value-investing, it's about speculation. Everything is speculation -- when you put money in a CD, you are speculating that the bank is not going to become insolvent and lose your money (and that the insurer is also not going to become insolvent). That's why you get the interest rate premium over treasury bonds. Now, you may argue that you're less likely to lose money in your savings account than in betting that Google will drop to $1 a share, and you're right... but it's all about degrees. Every decision you make is speculation. The market is all speculation, either people speculating, or people's algorithms speculating. Nothing more.

mistermann 16y ago
Really? So all the explicit rules and regulations about disclosure, etc that participants in the stock market must adhere to are not actually binding? Everything is just a big crapshoot? Sadly, your assessment is just about bang on of how it actually is. What people are complaining about is that it is advertised as something else. After the whole Bre-x scandal, there are now very strict rules on stating mineral resources. However, you can adhere to those rules, get money from investors to fully develop a mine and mill, and then sell the company for ten cents on on the dollar to a cayman islands based company, and the regulators won't bat an eye, even when you do most of the legwork for them. You seem to talk as if the markets have always been rigged. It was not always like this. Of course there were always indiscretions here and there, but the way it is now is just ridiculous.
- jrockway 16y ago
  So all the explicit rules and regulations about disclosure, etc that participants in the stock market must adhere to are not actually binding? Everything is just a big crapshoot? Yup. Because although the disclosures are correct, nobody reads them. They invest with their gut or their own metrics. (Someone who posts to HN regularly likes to claim that certain shapes in the EURJPY graph mean the whole world economy is going to collapse, for example.)