Stock Market Scam
According to professionals, the stock market is not a scam but a legitimate way to make money, if you play by some simple rules. “Observe the stocks, the one overbought and the one underbought.” Professionals say that, “investing in an underbought company, you will have a good chance to make money. Also observe the P/E. A company that has no P/E is in debt per share. Also, any P/E older than twenty years is overbought, like most of the 'dot com-s'. No wonder they eventually, crushed. Investing in any overbought account implies a scam.”
This may sound like Ancient Greek for many. The recent popular belief is that the stock market IS a scam. After the late big scandals, in the stock market, most reached the conclusion that “what goes up must go down”, so they refuse to risk, particularly their retirement funds, into the market. Many go even further, considering that all the financial world is a scam.
In his book, “Innumeracy”, John Allen Paulos, described the psychological process that brings so many, to dark skepticism, about the stock market. According to him, in the finance world, the emphasis is always put on success and the methods used to achieve them. Rarely or never, the failures are discussed. People have the tendency to follow the successful investors and overbuy shares. Without any insider knowledge and experience, they act upon false grounds. These are those who loose their investments. This is why, they compare the stock market with a flashy casino, more and more. They loose faith in future financial speculations, saying that the market predictions are never accurate.
On short, you cannot get rich with the stock market, according to popular beliefs. These are maintained by the trade world insiders. This, actually, makes the core of the stock market scams. These scams occur, on a daily basis, in quite a number. The truth is that nothing but pure professional manipulation stays behind the market oscillations, no inflation, gross national product, interest rates, political events or whatever else it is believed to make a difference.
Borrowing stock from others or from themselves, the Wall Street scammers lower the prices. Even with restrictions, like those imposed by SEC on NYSE members, not to lower prices with short sales, under the price of the last sale, they still find a way to do it and not even to report the short sales. Then, they wait until the prices reach a level convenient to them and sell their shares, for a huge profit and also repay the lender. So, the market is subject to the insiders and their partners and their interest to buy or sell stocks, at a certain moment.
All this market scam is, obviously, done at the expense of the small investors who are told to buy when a stock is on the rise and sell, when a stock is dropping, in value. Behind successful speculations, the investors are, always, high profile figures in the political and financial world.
