Monday, October 06, 2008

Do we need a stock market?

I've talked to two doctors (a friend and a cousin) who both answered me the same way when I asked about health care costs and insurance. They both agreed that because companies were publicly held, there would always be a concern for the market from the shareholder point of view instead of a competitive point of view. It adds to the complexity of profits when a company has to worry about the stock market and not just their own position in the market in terms of sales and the cost of doing business.

Some people think we could do without a stock market . . . and that we'd be better off. AFter all, for many, stocks are just promissory notes that have no value until they're sold. Other than capital, which could be obtained through loans, what would we be losing?

Do we need a stock market?

1 comment:

Anonymous said...

We don't it exists under the pretense of allowing companies capitol for expansion. We could do this through banks. Many people also have pension funds that are tied to the market, but those could be funded by corporate bonds. The reason we have a stock market is to protect the wealth of the already wealthy, and we will probably always have it because those people own our government.