Re: [A-List] Internal contradictions of capitalism

[Hudsonmi@xxxxxxx]

Dear Sabri,
       OK, I had food poisoning when I wrote that note. There always is SOME risk. But right now there is a chronic inflation of the real estate and stock markets. This inflation is what takes the risk away.
       The inflation stems from interest accruing on EXISTING savings, being plowed back into new lending for real estate and stocks -- plus new FORCED savings through pension paycheck withholding, Social Security and Medicare, plus the balance-of-payments deficit pumping dollars into the hands of foreign central banks and, via them, back into the U.S. Government bond market.
       It is this flow of funds that removes the risk. One need merely float on the tide.
       For very short-term movements there is a zig-zag, to be sure, but even this is largely caused by hedged derivatives trading. 
       On the bottom line, the risk is about equal to that to the people who bought empty lots after World War II, put parking gates on them to use them as parking lots to cover their taxes and interest, and then cleaned up when they sold them as real estate prices rose.
       If you look at the richest families as published by Forbes each year, you'll see that they either are real estate, finance or monopolies (Bill Gates).
       Does this answer the question?

Michael