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"We as individuals can do any of 3 things with our money.
1. We can spend it.
2. We can save it in a manner where we have 99 pct certainty our principal cannot decline. (Typically a bank)
3. We can decide to accept some level of risk in order to earn a return on the cash or assets we have available to deploy.
If we decide we want some risk in our lives, we have the choice to decide where to put those assets ourself, or hire someone else to do it, or some combination.
At this point the decision is made to speculate or invest.
The difference between the two is very simple. If you spend the money and the only way you can earn a return on that money is by selling whatever it is you have purchased. You are speculating.
If you give your money to a person or company, and that money is used directly to create commerce or to create an asset that will be used in commerce and if there are profits from that commerce that can be returned to you as a result, that is an investment..."
"...I do think itâs important to understand the expectation behind money. It can help us understand why irrational exuberance is rational. It can help us understand why bubbles happen. It can help us understand why markets donât react like you would statistically expect them to so often..."
"...Speculators invest purely to gain an annual return based on the risk they are willing to accept. This has lead to huge businesses competing to attract speculative money. This has lead the public equity markets to evolve from being primarily a source of capital for growing businesses to primarily a means of extracting wealth for insiders and speculators. Companies donât go public to grow, they go public so people can get rich..."
http://www.blogmaverick.com/entry/1234000660060351
"Posted Sep 25, 2005, 11:20 PM ET by Jim Parham
Hi Mark,
My Opinion.......A lot of lower and middle class individuals "speculate" because they believe it to be their best chance at attaining a better life. Most average folks don't have the financial wherewithal to seek out real quality "investments." Why do you think so many people stand in line at the corner 7-Eleven, waiting to buy a lotto ticket, or a scratch off? Same concept with stock market speculation....
The rich control the world and the game is rigged. Some people believe they have no choice but to speculate. Just my opinion....
"Posted Sep 26, 2005, 9:32 AM ET by Niklas
Hi Mark,
Did not you become rich "speculating" by founding a company, broadcast.com, that did not generate much dividends but was sold during good times?"
http://www.blogmaverick.com/entry/1234000660060351
1. We can spend it.
2. We can save it in a manner where we have 99 pct certainty our principal cannot decline. (Typically a bank)
3. We can decide to accept some level of risk in order to earn a return on the cash or assets we have available to deploy.
If we decide we want some risk in our lives, we have the choice to decide where to put those assets ourself, or hire someone else to do it, or some combination.
At this point the decision is made to speculate or invest.
The difference between the two is very simple. If you spend the money and the only way you can earn a return on that money is by selling whatever it is you have purchased. You are speculating.
If you give your money to a person or company, and that money is used directly to create commerce or to create an asset that will be used in commerce and if there are profits from that commerce that can be returned to you as a result, that is an investment..."
"...I do think itâs important to understand the expectation behind money. It can help us understand why irrational exuberance is rational. It can help us understand why bubbles happen. It can help us understand why markets donât react like you would statistically expect them to so often..."
"...Speculators invest purely to gain an annual return based on the risk they are willing to accept. This has lead to huge businesses competing to attract speculative money. This has lead the public equity markets to evolve from being primarily a source of capital for growing businesses to primarily a means of extracting wealth for insiders and speculators. Companies donât go public to grow, they go public so people can get rich..."
http://www.blogmaverick.com/entry/1234000660060351
"Posted Sep 25, 2005, 11:20 PM ET by Jim Parham
Hi Mark,
My Opinion.......A lot of lower and middle class individuals "speculate" because they believe it to be their best chance at attaining a better life. Most average folks don't have the financial wherewithal to seek out real quality "investments." Why do you think so many people stand in line at the corner 7-Eleven, waiting to buy a lotto ticket, or a scratch off? Same concept with stock market speculation....
The rich control the world and the game is rigged. Some people believe they have no choice but to speculate. Just my opinion....
"Posted Sep 26, 2005, 9:32 AM ET by Niklas
Hi Mark,
Did not you become rich "speculating" by founding a company, broadcast.com, that did not generate much dividends but was sold during good times?"
http://www.blogmaverick.com/entry/1234000660060351
