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Rt.66
ParticipantMish is the man to explain the “sideline cash” theory. Great article and easy to understand.
From Mish:
I am stunned by the number of emails about sideline cash I have been receiving in response to Unrelenting Bullishness. Many people are telling me that money moves into stocks and that sideline cash is bullish. Here is one such email.
Jon writes: “If I sold $50 million of equity, and I now have $50 million in sideline cash, putting it back in the market (along with a million other people) would force the market up. Don’t try to make it any more complicated Also, don’t think of each transaction as a buyer and seller. If it was as simple as one buyer and one seller, the market would NEVER MOVE EVEN ONE POINT.”
Sadly, this kind of thinking is running rampant. Jon, if you sold $50 million in equities you would indeed have $50 million in sideline cash (minus transaction fees).
However, Jim (who bought those shares from you), had $50 million in sideline cash before and does not have it now. All that transpired is the transfer of $50 million in sideline cash from Jon to Jim. Yes, it is as simple as that.
Money does not flow into the stock market except during IPO and secondary offerings. Otherwise the same amount of sideline cash (minus transaction fees) existed before and after someone buys stocks.
more….
http://globaleconomicanalysis.blogspot.com/2008/11/sideline-cash-theory-revisited.htmlParticipantMish is the man to explain the “sideline cash” theory. Great article and easy to understand.
From Mish:
I am stunned by the number of emails about sideline cash I have been receiving in response to Unrelenting Bullishness. Many people are telling me that money moves into stocks and that sideline cash is bullish. Here is one such email.
Jon writes: “If I sold $50 million of equity, and I now have $50 million in sideline cash, putting it back in the market (along with a million other people) would force the market up. Don’t try to make it any more complicated Also, don’t think of each transaction as a buyer and seller. If it was as simple as one buyer and one seller, the market would NEVER MOVE EVEN ONE POINT.”
Sadly, this kind of thinking is running rampant. Jon, if you sold $50 million in equities you would indeed have $50 million in sideline cash (minus transaction fees).
However, Jim (who bought those shares from you), had $50 million in sideline cash before and does not have it now. All that transpired is the transfer of $50 million in sideline cash from Jon to Jim. Yes, it is as simple as that.
Money does not flow into the stock market except during IPO and secondary offerings. Otherwise the same amount of sideline cash (minus transaction fees) existed before and after someone buys stocks.
more….
http://globaleconomicanalysis.blogspot.com/2008/11/sideline-cash-theory-revisited.htmlParticipantMish is the man to explain the “sideline cash” theory. Great article and easy to understand.
From Mish:
I am stunned by the number of emails about sideline cash I have been receiving in response to Unrelenting Bullishness. Many people are telling me that money moves into stocks and that sideline cash is bullish. Here is one such email.
Jon writes: “If I sold $50 million of equity, and I now have $50 million in sideline cash, putting it back in the market (along with a million other people) would force the market up. Don’t try to make it any more complicated Also, don’t think of each transaction as a buyer and seller. If it was as simple as one buyer and one seller, the market would NEVER MOVE EVEN ONE POINT.”
Sadly, this kind of thinking is running rampant. Jon, if you sold $50 million in equities you would indeed have $50 million in sideline cash (minus transaction fees).
However, Jim (who bought those shares from you), had $50 million in sideline cash before and does not have it now. All that transpired is the transfer of $50 million in sideline cash from Jon to Jim. Yes, it is as simple as that.
Money does not flow into the stock market except during IPO and secondary offerings. Otherwise the same amount of sideline cash (minus transaction fees) existed before and after someone buys stocks.
more….
http://globaleconomicanalysis.blogspot.com/2008/11/sideline-cash-theory-revisited.htmlParticipantMish is the man to explain the “sideline cash” theory. Great article and easy to understand.
From Mish:
I am stunned by the number of emails about sideline cash I have been receiving in response to Unrelenting Bullishness. Many people are telling me that money moves into stocks and that sideline cash is bullish. Here is one such email.
Jon writes: “If I sold $50 million of equity, and I now have $50 million in sideline cash, putting it back in the market (along with a million other people) would force the market up. Don’t try to make it any more complicated Also, don’t think of each transaction as a buyer and seller. If it was as simple as one buyer and one seller, the market would NEVER MOVE EVEN ONE POINT.”
Sadly, this kind of thinking is running rampant. Jon, if you sold $50 million in equities you would indeed have $50 million in sideline cash (minus transaction fees).
However, Jim (who bought those shares from you), had $50 million in sideline cash before and does not have it now. All that transpired is the transfer of $50 million in sideline cash from Jon to Jim. Yes, it is as simple as that.
Money does not flow into the stock market except during IPO and secondary offerings. Otherwise the same amount of sideline cash (minus transaction fees) existed before and after someone buys stocks.
more….
http://globaleconomicanalysis.blogspot.com/2008/11/sideline-cash-theory-revisited.htmlParticipantThat’s creative Flu and funny too.
Are you thought processes on American manufactured goods and unions your own? Are they self serving or self sacrificing? How did you arrive at your “gee my Honda is so great and GM sucks” attitude? Do you even know why you hate good union jobs that have worker protection, good pay and benefits? Any idea why you bloat with delight when thousands more lose their good union jobs in Michigan while Korea picks up those jobs building the Hyundias more and more Americans find so appealing? Do you wonder why your thoughts go strait to “yeah those greedy bastards deserve it”?
Why do you think GM or Ford or Chrysler makes shitty cars when you see them everyday reliably taking your nieghbor to work or next to you on the highway doing the same thing your Honda is doing, just as well. Do you even know that Toyota repair bays are full lots of the time?
ParticipantThat’s creative Flu and funny too.
Are you thought processes on American manufactured goods and unions your own? Are they self serving or self sacrificing? How did you arrive at your “gee my Honda is so great and GM sucks” attitude? Do you even know why you hate good union jobs that have worker protection, good pay and benefits? Any idea why you bloat with delight when thousands more lose their good union jobs in Michigan while Korea picks up those jobs building the Hyundias more and more Americans find so appealing? Do you wonder why your thoughts go strait to “yeah those greedy bastards deserve it”?
Why do you think GM or Ford or Chrysler makes shitty cars when you see them everyday reliably taking your nieghbor to work or next to you on the highway doing the same thing your Honda is doing, just as well. Do you even know that Toyota repair bays are full lots of the time?
ParticipantThat’s creative Flu and funny too.
Are you thought processes on American manufactured goods and unions your own? Are they self serving or self sacrificing? How did you arrive at your “gee my Honda is so great and GM sucks” attitude? Do you even know why you hate good union jobs that have worker protection, good pay and benefits? Any idea why you bloat with delight when thousands more lose their good union jobs in Michigan while Korea picks up those jobs building the Hyundias more and more Americans find so appealing? Do you wonder why your thoughts go strait to “yeah those greedy bastards deserve it”?
Why do you think GM or Ford or Chrysler makes shitty cars when you see them everyday reliably taking your nieghbor to work or next to you on the highway doing the same thing your Honda is doing, just as well. Do you even know that Toyota repair bays are full lots of the time?
ParticipantThat’s creative Flu and funny too.
Are you thought processes on American manufactured goods and unions your own? Are they self serving or self sacrificing? How did you arrive at your “gee my Honda is so great and GM sucks” attitude? Do you even know why you hate good union jobs that have worker protection, good pay and benefits? Any idea why you bloat with delight when thousands more lose their good union jobs in Michigan while Korea picks up those jobs building the Hyundias more and more Americans find so appealing? Do you wonder why your thoughts go strait to “yeah those greedy bastards deserve it”?
Why do you think GM or Ford or Chrysler makes shitty cars when you see them everyday reliably taking your nieghbor to work or next to you on the highway doing the same thing your Honda is doing, just as well. Do you even know that Toyota repair bays are full lots of the time?
ParticipantThat’s creative Flu and funny too.
Are you thought processes on American manufactured goods and unions your own? Are they self serving or self sacrificing? How did you arrive at your “gee my Honda is so great and GM sucks” attitude? Do you even know why you hate good union jobs that have worker protection, good pay and benefits? Any idea why you bloat with delight when thousands more lose their good union jobs in Michigan while Korea picks up those jobs building the Hyundias more and more Americans find so appealing? Do you wonder why your thoughts go strait to “yeah those greedy bastards deserve it”?
Why do you think GM or Ford or Chrysler makes shitty cars when you see them everyday reliably taking your nieghbor to work or next to you on the highway doing the same thing your Honda is doing, just as well. Do you even know that Toyota repair bays are full lots of the time?
ParticipantVery High Temperature nuke reactors (VHTR) are perfect for combo electical generation/desalination, as heat is the main requirement for desal. Cheap clean electricity and fresh water.
As I recall there is a San Diego company who can build VHTRs.
Millions of acres of Colorado river farm land are already fallowed each year to provide drinking water to SoCal. It does not look like its going to improve anytime soon, so why no nuke desalanation plants in Obamas stimulus? That seems like a good way to put people to work and future generations get more than just a tax bill;
they get cheap electricity, jobs and fresh water?ParticipantVery High Temperature nuke reactors (VHTR) are perfect for combo electical generation/desalination, as heat is the main requirement for desal. Cheap clean electricity and fresh water.
As I recall there is a San Diego company who can build VHTRs.
Millions of acres of Colorado river farm land are already fallowed each year to provide drinking water to SoCal. It does not look like its going to improve anytime soon, so why no nuke desalanation plants in Obamas stimulus? That seems like a good way to put people to work and future generations get more than just a tax bill;
they get cheap electricity, jobs and fresh water?ParticipantVery High Temperature nuke reactors (VHTR) are perfect for combo electical generation/desalination, as heat is the main requirement for desal. Cheap clean electricity and fresh water.
As I recall there is a San Diego company who can build VHTRs.
Millions of acres of Colorado river farm land are already fallowed each year to provide drinking water to SoCal. It does not look like its going to improve anytime soon, so why no nuke desalanation plants in Obamas stimulus? That seems like a good way to put people to work and future generations get more than just a tax bill;
they get cheap electricity, jobs and fresh water?ParticipantVery High Temperature nuke reactors (VHTR) are perfect for combo electical generation/desalination, as heat is the main requirement for desal. Cheap clean electricity and fresh water.
As I recall there is a San Diego company who can build VHTRs.
Millions of acres of Colorado river farm land are already fallowed each year to provide drinking water to SoCal. It does not look like its going to improve anytime soon, so why no nuke desalanation plants in Obamas stimulus? That seems like a good way to put people to work and future generations get more than just a tax bill;
they get cheap electricity, jobs and fresh water?ParticipantVery High Temperature nuke reactors (VHTR) are perfect for combo electical generation/desalination, as heat is the main requirement for desal. Cheap clean electricity and fresh water.
As I recall there is a San Diego company who can build VHTRs.
Millions of acres of Colorado river farm land are already fallowed each year to provide drinking water to SoCal. It does not look like its going to improve anytime soon, so why no nuke desalanation plants in Obamas stimulus? That seems like a good way to put people to work and future generations get more than just a tax bill;
they get cheap electricity, jobs and fresh water? -
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