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Open Stock Market

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User offline. Last seen 10 years 41 weeks ago. Offline
Joined: 2008-12-01

Is a free and open stock market a possibility? I am curious to know what all of you think about a stock market system based on complete openness in terms of financial reporting and the ability of any person to become an investor. All transactions must be open and reported. All gains and losses must be public knowledge. What legal restrictions would stand in the way of a non-profit company created to accomplish this task?

In the past, logistical hurtles may have prevented an open stock market from being possible. Today, stock histories and real-time trade information are a pricey commodity, but I do not think it has to be this way. Besides a secure website and a transactional database, what else is needed to create an open stock system?

memenode's picture
User offline. Last seen 31 weeks 28 min ago. Offline
Joined: 2004-07-12
I agree everyone should be

I agree everyone should be able to become an investor or speculator if (s)he so wishes, without having to jump through any regulatory hoops. And speaking of regulation, I actually don't believe the current crisis and recent stock market crashes were caused by lack of regulation, just the opposite.

But I wouldn't want to require everyone, by law, to report all of their activities in the stock market. Every person has a right to discretion. You only need to be forthcoming to the person you're trading with, if necessary, perhaps there can be more transparency in that sense..

To be honest, though, I never invested in the stock market so I don't really have enough experience to go further into the details. If you're proposing a whole alternative stock market though, available to everyone, I'll say I like the idea. Smiling

I'll link this to our IRC channel.. maybe someone can post additional comments. Smiling

Thanks

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User offline. Last seen 10 years 41 weeks ago. Offline
Joined: 2008-12-01
A whole new stock market

Thanks for the response libervisco. Your second interpretation nailed it; a new, electronic exchanged that is based on the principles of openness would provide an alternate investing option for speculators and an alternative financing option for companies. It is critical that the system have low barriers to entry for all parties. It would be interesting to discover what legal and technical barriers stand in the way of this idea.

memenode's picture
User offline. Last seen 31 weeks 28 min ago. Offline
Joined: 2004-07-12
Well, clearly, this would

Well, clearly, this would require companies to actually be willing to enlist themselves for trading on this new stock market and while I'm not a legal expert I'd expect regulations in this area to be quite tight. I'd love to hear from someone more knowledgeable about how exactly are stock markets born and regulated though.

But perhaps it does not have to be a stock market in a classical sense, perhaps not falling under the regulations which would apply to them. It could be like a web based service which offers the infrastructure necessary for private businesses to enlist themselves and investors to buy their shares (valid and redeemable only on that site). This may be a way to start small and evade much of the complexity of starting a "real" stock market... This reminds me of Kiva, which allows people to make small loans to poor entrepreneurs. It's obviously not the same thing, but it's an example of a site that serves as a sort of an investment market in itself (except these aren't really investments since you can't really expect profit on kiva). Entrepreneurs place their plans and loan makers can browse and choose whom to make a loan to.

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