Wednesday, 15 October 2008

Where does it go?

I must admit the thought crossed my mind yesterday about what the effect of all these bail outs is and who they will advantage.
Since, it seems to me, the rich are the ones who are best able to withstand the ravages of the crashes, they are also the ones who are able to buy up all the cheap stocks and shares.
So if the ACME Trading Company dropped from $5 to $1 and then Mr Ichg bought 500,000 shares and then they bounced back to $1.50 (well below the original price but a cool 50% better than the purchase price) by my reckoning he made an easy $250K possibly overnight.
Of course Mr and Mrs Joe Average would never even be able to purchase anything like $10,000 worth of shares to get a modest $5000 overnight profit.
So who does the bail out help.
As someone said to me a few days ago...where did all this money go, and who has it now...tell them to give it back.
My answer is that this money never existed in the first place (credit), but it sure ain't in the pockets of the poor.

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