Next year I'm going to get back into the market. It has been about 9 years since I dabbled. I had a nice little pile back then and I did will with a conservative portfolio through the times of irrational exuberance, like everybody else. Except I was very skeptical as I learned about the different classes of investors and came to understand what professional traders know that day traders do not. There are indeed some rigs in the game. All that said, I've put away some money and it's time to make it work. And I'm not going to be so edgy that I need to beat 4 percent.
So I started looking at ETFs and I found RSX. No it's not a Mazda, it's a Russian fund, and it's doing damned well. I sent that googled page over to my brother Doc who is carping about unemployment. And an old idea creeped into my head. Capitalism doesn't die just because the man running the government is a socialist.
It would seem that by definition, anyone dumb enough to be a socialist is less intelligent than Adam Smith. I exaggerate socialist stupidity, but Adam Smith understood something about the greed of men, socialists only understand the greed of businessmen. Limiting the greed of businessmen but giving everything by law over to the appetites of the masses is indeed a formula for self-destruction. This is why command economies that survive restrain the masses to an extraordinary degree. It doesn't auger very well for those who start in the peasantry but are clever enough to figure out how merchants make money. Where's the incentive for them to learn? Where's the law that protects them as they do?
Just imagine the scenario. The great leader says "Who want's to make more money than the average prole?" Mee!" The hands fly up by the millions. "OK", he says. "I'm going to pass legislation to get a program started that will get you the government pass you will need to be a part of the production for the people." Yeah, right behind the cousins of everybody who's writing the legislation. The lottery is held and a new protected class is created, just like that. Free men don't wait for government legislation and business programs to figure out how to make money with their fellow men. They scheme about it over a beer at the local pub or turn their living room into a smoke filled room or sit up late nights in the dorm or walk into Mr. Peterson's corner store and ask for work. They read the Wall Street Journal or Motley Fool. They even try out for game shows. There are a million ways to make a buck and those dreams and schemes never stop percolating. Cigarettes trade in prison, sandwiches trade on the schoolyard. Every man is a market, you merely need to find his price.
Governments will always have some role in setting rules and regulating markets. But markets are between and among men and have always been because it is our nature to trade selfishly to eventual mutual benefit. Some men are clever traders and others are fools, but they are motivated by the same thing - their very nature as human beings. That never changes no matter what the balance of power. Capitalism dies when the human spirit dies. Anybody want to take a wager on when that happens?
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