Quote:
Originally Posted by Ferd
can you day derivatives? and anyone claiming to understand derivatives as they are used in financial terms is a liar. (i mean in detail)
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I would not go that far. I have a done fairly extensive study and understand the concepts.
I would say I would doubt the veracity of anyone who says that they can actually predict them.
Furthermore, once broken down they are simply insurance policies predicting the future movement of stocks and commodities. Personally, I think of it as educated gambling, which is probably the way the majority approach the stock market anyway.
A far cry from the original intent, namely to raise capital.
Derivatives end up serving the function of reducing the future ACTION of a financial instrument to a commodity in and of itself regardless of what is happening to the company or "goods" which were supposed to be its original basis of value.
Potential trillions involved, enough to wreck the economy world wide and utter folly. Only one of the several factors which will lead to our economic apocalypse.
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