Greed IS good.

I have been in the markets ever since the earth's crust started cooling and the first "exchange" was created. Back then participants threw rocks at each other as a way of expressing bullishness or bearishness. It had its merits.

Fastforward to 2009, if "greed captures the essence of the evolutionary spirit" then Adam Smith's "invisible hand" will prevail in spite of the war on capitalism and anything that smacks of profit.

The most galling comment I heard during the recent meltdown was in a street interview by a large news network who happened upon a 30-something male:

Question - "What do you think about what's going on?"
Answer - "The drug companies made billions of dollars in profits, there's PROOF enough they're ripping us off!"

Maybe this yuckapuck can develop a life saving drug on his allowance money, drug companies invest billions in developing new drugs. Oil companies spend billions developing oil fields. Maybe the rising socialist star can do it better and cheaper with a pick and shovel.

The question of "ripping off" aside, why was this rising communist not aware of the fact that the sole purpose of a company IS to make profits? Presuming this putz had a job, why was he not aware that if his employer doesn't make profits ultimately he has no J O B?

Gordon Gekko in the movie "Wall Street" DID have it right when he said, "... greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA."

I was asked by a student once if I traded out of greed. The question arose as I explained support and resistance levels on a stock chart. I mentioned that another word for support is greed and another word for resistance is fear. The student incorrectly inferred that the greed I was speaking of was the "bad" greed we all hate.

The greed that Gordon Gekko spoke of was the same greed that I spoke of relative to a stock chart. It is a greed out of the basic human attribute of a desire to get ahead and a willingness to take risks to achieve that end.

It is the same greed that makes people, knowingly or unknowingly, take risks whether they are trading or starting a business.

Whose greed is greater and which is the one with the "bad" type of greed, the entrepreneur's or the government's?