The wealth of a Nation grows with the gradual investment and re-investment of saved capital into higher order goods with the aim of producing better services and products that may satisfy societal wants. So, the aggregate capital of a society is to be allocated carefully into the hands of the best and the brightest ” entrepreneurs” and ” undertakers” who can attempt at innovating and developing new products for future consumption and satisfaction.
Today's wealth is simply the compounding of yesterday's savings and investments. And this process must be perpetuated or we run the risk of stagnation or even under-development.
The financial economy therefore plays an essential role for its enable stored savings and capital to be diffused among the variety of projects and ideas in needs of capital. Financial institutions thusfore play an intermediary role, so does the stock market and other financial institutions like Banks, insurances…etc
Their main goal is to protect ” the pool of savings” and help allocate it to various investment project in view of future production.
Logically therefore, the stock market cannot be the standard bearer of a healthy economy let alone a metric for economic growth. All the stock market does is to facilitate the exchange of ” business ownership receipt” from various market participants. Stocks by themselves do little to reflect the health of an economy or even the soundness of a business.
Going even further, stocks valuation often misrepresent the underlying value of a business. Especially in periods of craze speculative mania where securities are bid up and valuations are detached from business fundamentals.
Therefore, the function of an ANALYST, I deem, is to help clear the fog between quality undertakings worthy of further capital investments, and, faulty capital wasting self enrichment or fraudulent schemes that eats up capital and impoverish society.
In my opinion, the main MISSION OF AN ANALYST is to HUNT DOWN fraudulent schemes, pumps and dumps, unprofitable constructs, manipulative and deceitful foreign frauds and all sorts of hurtful ” BUSINESS” OPERATIONS that do more harm to our society than petty crime and even gang violence.
Left unchecked, wasteful businesses eats up our pool of savings and put at risk the welfare of our offsprings.
Finally, the faster we can allow a speculative mania to deflate, the easier it will be for us to restore a relative sound balance into our economy by flushing out bad operations and restoring a sound balance between in the value of Capital. Which in turn will only attracts REAL entrepreneurs rather than opportunists speculators and deceitful manipulators trying to take advantage of the low interests rates.
To help grow an economy, we need more entrepreneurs and less speculation!
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