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Each one of your cases can be debunked. Stocks only have value when SEC deems that it can have value. There are people who would love to live in a cold climate

by ktta 9y ago

Each one of your cases can be debunked. Stocks only have value when SEC deems that it can have value. There are people who would love to live in a cold climate for whom land in a warm climate has no value. BMW costs more than Honda because people are willing to pay that much for it, which is how BMW sets the price. All of your cases are about subjective value. Take out the buyer with personal interests on the other side of the transaction and see if it has any value. A good test is to take what you think has value and move 10000 years into the future or the past and consider if everyone you encounter will value it. Do you think it will have value? If not, then no, it doesn't have any 'objective' value.

sbenitoj 9y ago
Bingo!
vasilipupkin 9y ago
ehhhh, no. Stocks do not only have value when SEC deems that it can have value. That is completely incorrect. SEC simply regulates equity issuance, it doesn't set the price of each stock. BMW costs more than honda because it is objectively a better car. By objectively identifiable metrics. Yes, it's true there are some people who love cold climates. But in the US people are moving from cold climates to warmer climates, on average - so real estate in warmer climates is growing in value faster. So, no, you are completely wrong.
- ktta 9y ago
  > SEC ... doesn't set the price of each stock No it doesn't, but SEC has the power to allow the stock to get traded in the first place. So the value is subject to SEC's presence. If there is no SEC, there is no 'stock' for you to get dividends from. > BMW costs more than honda because it is objectively a better car. By objectively identifiable metrics. You discount the people do don't give care about the objective metrics. There's a lot of personal preference involved when one chooses a car to buy (apart from buying power). >But in the US people are moving from cold climates to warmer climates, on average Last time I checked, US has of 4% of the world's population. I'd wager more than 4% of the world would love to move to a colder climate. >So, no, you are completely wrong. I don't think any of the facts I've stated are. If you're talking about my opinion that there is only subjective value, well, that's subjective too :)
  - vasilipupkin 9y ago
    Not correct. The price of the stock times shares outstanding is its value. Where does this value come from? Why are Apple and google doing so well? It's not, by your logic, because they are great companies - that would be an objective metric, no? Existence of the SEC doesn't make stock values subjective. Any argument here that starts with "some people" - is irrelevant. Everything we are discussing is about on average, statistically. On average, a beachfront condo in Miami will cost more than an equivalent condo in Iowa. Why? Because it's on the beach and people, on average, value that more than being somewhere in Iowa

by ktta 9y ago

sbenitoj 9y ago

Bingo!

vasilipupkin 9y ago

ehhhh, no. Stocks do not only have value when SEC deems that it can have value. That is completely incorrect. SEC simply regulates equity issuance, it doesn't set the price of each stock. BMW costs more than honda because it is objectively a better car. By objectively identifiable metrics. Yes, it's true there are some people who love cold climates. But in the US people are moving from cold climates to warmer climates, on average - so real estate in warmer climates is growing in value faster. So, no, you are completely wrong.

ktta 9y ago
> SEC ... doesn't set the price of each stock No it doesn't, but SEC has the power to allow the stock to get traded in the first place. So the value is subject to SEC's presence. If there is no SEC, there is no 'stock' for you to get dividends from. > BMW costs more than honda because it is objectively a better car. By objectively identifiable metrics. You discount the people do don't give care about the objective metrics. There's a lot of personal preference involved when one chooses a car to buy (apart from buying power). >But in the US people are moving from cold climates to warmer climates, on average Last time I checked, US has of 4% of the world's population. I'd wager more than 4% of the world would love to move to a colder climate. >So, no, you are completely wrong. I don't think any of the facts I've stated are. If you're talking about my opinion that there is only subjective value, well, that's subjective too :)
- vasilipupkin 9y ago
  Not correct. The price of the stock times shares outstanding is its value. Where does this value come from? Why are Apple and google doing so well? It's not, by your logic, because they are great companies - that would be an objective metric, no? Existence of the SEC doesn't make stock values subjective. Any argument here that starts with "some people" - is irrelevant. Everything we are discussing is about on average, statistically. On average, a beachfront condo in Miami will cost more than an equivalent condo in Iowa. Why? Because it's on the beach and people, on average, value that more than being somewhere in Iowa