Stock traders are idiots.

[Cymric]

whabang wrote:
Agreed! People act too fast! :-(

Seconded. I've always wondered about a law which introduces a minimum time frame in which you can trade to allow markets to properly settle for a bit. I've also wondered about a law which limits access to stock market information---or at least to not tout it all over the major news networks. Stock markets are just a part of the entire economy, but from the press they gather they have become the Supreme Superbeing. Right now we've created a twitchy and nervous monster where the winner is the stock broker with the quickest reflexes, not the one with the best economic insight.

[Cymric]

KennyR wrote:
There are two problems with trying to limit the market. One, economic theory is far from perfect and people might even make things worse if the limits are wrongly thought out. Two, there are too many people with the Libertarian/Conservative/Monetarist notion that limiting the market - for any reason - is evil socialism and so will therefore destroy the market.

Well, as far as I am concerned, economists are a bunch of failed applied mathematicians. I've seen MSc-theses which had me lying my head in my lap in abject shock and terror at the thought of those idiots governing the lives of billions. So in that regard I agree with your observation that economic theory is far from perfect, and that tinkering could very well make things worse than they already are. I'm not even sure whether it is possible at all to make the stock markets more robust and less subject to random jitter.

As for the other notion: I have a slight reddish streak in me, so while I think that overall, free markets are a Good Thing they should not be the definitive answer to everything. People should and must govern the market and its structure, and not the other way around. There are other issues to keep in mind besides shareholder value, ROI and making a profit.