...their stocks acting as fiat currencies, and large players acting as cartels.

• (4:05:29 PM) Chris(gtalk): oh i had an interesting kinda revellation when i was thinking about the stock market the other day
  (4:05:42 PM) Chris(gtalk): i was wondering if you could tell me if this makes sense
  (4:05:48 PM) mech0r: NOTHING MAKES SENSE
  (4:05:53 PM) Chris(gtalk): haha
  (4:05:57 PM) Chris(gtalk): hear me out :D
  (4:06:02 PM) Chris(gtalk): i originally thought that the stock market was like gambling
  (4:06:06 PM) Chris(gtalk): but it's not, because you've got dividends; *options* are gambling.
  (4:06:27 PM) Chris(gtalk): then, i thought about it from the point of view of a company issuing stocks...
  (4:06:39 PM) Chris(gtalk): and i realized that a stock is a lot like a fiat currency
  (4:06:53 PM) Chris(gtalk): the company can print as many as they want and exchnge them for whatever the "market value" of the paper is
  (4:06:58 PM) Chris(gtalk): but printing too many is bad for them
  (4:07:01 PM) Chris(gtalk): because then they devalue their stocks (like inflation)
  (4:07:05 PM) Chris(gtalk): so they want to keep a balance
  (4:07:24 PM) Chris(gtalk): and, like money, the stocks have a kind of "inherent value" because of dividends
  (4:07:32 PM) Chris(gtalk): while money has inherent value because of the goods you can buy in that country
  (4:07:41 PM) Chris(gtalk): does that seem accurate to you?
  (4:08:31 PM) mech0r: well yeah they have dividends in order to attract investors
  (4:08:43 PM) mech0r: but most small and tech companies won't have divs
  (4:08:57 PM) mech0r: i have to go to the bathroom
  (4:08:57 PM) mech0r: brb
  (4:12:29 PM) Chris(gtalk): ok
  (4:12:39 PM) Chris(gtalk): hmm
  (4:12:54 PM) Chris(gtalk): so how does a small tech company start up?
  (4:13:01 PM) Chris(gtalk): like... why would anyone buy their stocks?
  (4:13:06 PM) Chris(gtalk): i guess they're super-cheap before dividends?
  (4:18:49 PM) mech0r has gone away.
  (4:19:25 PM) mech0r is no longer away.
  (4:19:49 PM) mech0r: hmmm
  (4:19:59 PM) mech0r: before a company starts up
  (4:20:03 PM) mech0r: there will be agents and promoters
  (4:20:25 PM) mech0r: they make deals with potential investors
  (4:21:37 PM) Chris(gtalk): ok
  (4:21:50 PM) Chris(gtalk): haha i wonder if there's a parallel to the fiat currency
  (4:22:00 PM) Chris(gtalk): when you start a fiat currency, you usually have a country already
  (4:22:15 PM) Chris(gtalk): and you make the fiat currency inherently valuable by telling people they can pay taxes with it
  (4:22:44 PM) Chris(gtalk): IPOing is a little different though
  (4:22:58 PM) Chris(gtalk): actually, i guess an IPO is like creating a fiat currency with cartels involved
  (4:23:08 PM) Chris(gtalk): you say, "hey banana cartel.. accept this money and i will give you lots of free money!"
  (4:23:28 PM) Chris(gtalk): which is equivalent to making deals with potential investors
  (4:23:47 PM) Chris(gtalk): so the stock market is like lots of tiny countries with their own fiat currencies
  (4:24:20 PM) Chris(gtalk): in the real world, of course, countries will adopt other countries' currencies
  (4:24:25 PM) Chris(gtalk): does that ever happen in the stock market?
  (4:24:36 PM) Chris(gtalk): pegging stock values to other companies stocks?
  (4:27:12 PM) mech0r has gone away.
  (4:28:39 PM) mech0r is no longer away.
  (4:30:07 PM) mech0r: hmmmmm
  (4:30:10 PM) mech0r: then it wouldn't be a free market
  (4:30:46 PM) mech0r: but similar companies will inherently move the same way as each other
  (4:31:09 PM) mech0r: and they may use each other as bench marks
  (4:34:14 PM) mech0r: http://www.hondanews.com/categories/1074/videos/1079#
  (4:54:43 PM) Chris(gtalk): ok
  (4:55:08 PM) Chris(gtalk): so it's a bit like pegging...
  (4:55:19 PM) Chris(gtalk): i mean, pegging currencies is stupid :)
  (4:55:24 PM) Chris(gtalk): it's done for dumb political reasons
  (4:55:40 PM) Chris(gtalk): the stock market moves too fast for anything like that to work
  (4:56:22 PM) mech0r: i'm gonna play tf2
  (4:56:33 PM) Chris(gtalk): o rly