Thursday, January 12, 2012

Greed is good? Not a chance!!!

Ayn Rand wants you to believe that it's people being greedy that gets the market going and keeps it rolling along.  But nothing could be further from the truth.   Think about it;  if you were to bet 5 dollars at roulette,  on number 22,  and someone next to you bet 100,  would that be greed?  Of course not,  it's simply called "taking a chance".  Wagering more on an uncertain outcome,  is taking risk,  not being greedy.

One can only be "greedy"  when,  knowing the outcome already,  they place a "wager" -- which is really no wager at all -- of such size that they risk giving away the fact that they have advanced knowledge.  So,  in short,  greed is parasitism carried to ridiculous heights.  Heights,  such that,  the fraud being perpetrated,  is placed at risk of being revealed,  simply because the actors acquisitiveness can't be contained.

In the marketplace,  investors use various strategies to contain and/or offset the risk they must take to make money.  While the greedy,  merely work to gain foreknowledge of already known outcomes,  and seek to take full advantage of that knowledge.  This actually introduces a cost to the market,  rather than doing anyone but the perp,  any good.  Therefore greed does nothing good for the market at all!  In fact it is a negative that destroys trust and does damage to the market.  Ayn would have you believe that people,  taking advantage of unfair and likely prohibited situations,  are to be lauded and held in high esteem,  when,  in fact,  they should be scorned, castigated and shunned,  if indeed not punished.

Since it is her central theme,  this attempt to turn bad into good,  that underlay all her thoughts on matters,  she totally fails.  People who follow her missives advice are either twisted themselves,  or hopelessly unable to think clearly enough,  to see that she is ultimately wrong.  By her metrics Bonny and Clyde are to be lauded for how,  their efforts and greed,  inspired the banking security industry,  rather than opposed for the crimes they committed.

Real investors are risk takers,  they do not know the outcome of what they've wagered on.  They have only certain,  perhaps educated,  guesses about what kind of outcome to expect,  but beyond that they can't know anything for certain,   because they're not using knowledge certain,  of things already done and decided.  After the coin lands heads up,  any wager made then is not a bet but trickery.  Ayn Rand would have you believe otherwise!

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