I’ve got to admit that I giggle a little each day the stock market loses another hundred or so points. As a macro-economist and macro-sociologist, it has always amazed me that people will invest in speculative hubris and drive a market (stock or credit or other) to soaring heights, never believing that it’ll hit a snag somewhere, and then be horrified when it drops off – while they sell off, amplifying the drop.
Of course, I sympathize with individuals who are caught in the crunch. But so much of this money is just trading of bits (of paper or digital). There’s no foundation to it at all (although I’m not naive enough to believe that a gold standard or some such is necessary or workable). I prefer to think of it as Flight of Icarus behavior… you speculate, your wealth soars, you fly close or beyond the bubble, and you lose spectacularly.
The part that is no laughing matter is when “normal” people are unwittingly participating in others’ speculation through all the different types of derivative funds. They lose the physical trappings of a comfortable life, despite never being able to see (let alone understand) the financial forces that caused it.
Am I losing money in the financial crisis? Yup. Do I depend on that money in my day to day life? Not the stuff that I control and own. And the company I work for is quite conservative financially. But I bet that I will be affected individually by the larger downturn in the economy, and the affect it will have on capital investment in automation.
But I still find this dismal news perversely pleasurable. <giggle>