The ills of the current stock markets

In the recent financial crisis, all the stock indices plummeted, and in the process, many good stocks were devalued to a similar degree as troubled stocks. Then fear, panic and feelings of mistrust reigned. Many governments intervened and the panic was stopped for the moment. Feelings of fear and lack of confidence were and still are prevalent just before the next batch of bad financial news.

Companies with strong financial fundamentals, but which saw their share values ​​plummet significantly, were left defenseless in the face of this onslaught. Everyone would like to do something, if possible then, to stop this uncontrollable slide. Many wondered what could be done besides those stimulus packages hastily scrambled on stage by various governments. Improvement, innovation and renewal must lead the way out of this rot.

Any system that is not beneficial to the masses will be scrapped

The current systems on the stock exchanges were not safe for ordinary people to grow their money, as evidenced by the recent Financial Tsunami. dare i say that any investment system that is not good for ordinary people will fail and be dumped. We must look for an alternative investment system from reputable companies or financial experts, whose goal is to ensure that the money invested by ordinary people increases and not decreases.

Breaking the Current Mold – The Stock Markets

Instead of financial institutions and financial investors, a breaking method is to go directly to the public through the Internet. This approach is tricky, firstly, because of the dangers of the stock markets, and secondly, most financial institutions and financial investors were recouping their losses and had understandably turned cautious or conservative.

By going public on the Internet and not through the stock exchanges, there will be very significant cost savings in launching the ‘initial public offering’ of the shares to the online world. Since the cost outlay is comparatively low, and also to attract netizens, it may be necessary to give free shares or PEPs (Public Equity Points, similar to shares but without voting rights) to online subscribers. When underwriters or investors get their shares for free, there will be no financial harm to these interested parties.

Also, by avoiding stock exchanges, there is no legal need for a subscription deadline as there is with stock exchanges. Each subscriber will be allocated a certain fixed number of shares or PEPs upon successful registration.

Another different approach to current practices is in the form of stock valuation. All stock or stock values ​​can be heavily influenced by public sentiment today, despite the strong economic fundamentals behind the stock. A different approach might be for stock valuation to ONLY be done internally, for example, based on actual membership growth and sales performance for each company. With this, there is no way for the values ​​of such ‘spun off’ shares or PEPs to be manipulated by speculation and/or panic.

More importantly, unlisted company stocks or PEPs will be spared from any impending unfortunate financial cascading ripple effects, which can occur any time major corporations release their annual reports. What healthy company would want to be brought down by bad news from sick companies? But today’s stock exchange systems are just too capable of it: spiraling down in free fall!

The Only Right Approach – Benefiting Common People

The foundation of any new approach must be ensuring that ordinary people ONLY grow their money and don’t lose money. Before the recent financial crisis, almost all financial institutions and managers said that market forces determined all stock or stock movements. Market forces would drive values ​​either way: up or down. After witnessing the aftermath of the current financial crisis, there was some deep soul-searching and some people began to realize that there were ways and approaches that would drive stock or stock values ​​one way, i.e. ONLY going up. These enlightened people are now taking new steps.

Lastly, I’m sure there are several much larger companies behind the scenes watching, learning and evaluating these new moves and approaches taken by companies going public without listing them on stock exchanges. I am also sure that many companies will break new frontiers, away from the sins of the current stock markets.

So put your money into these ‘only appreciated’ stocks, for your profits!