DHUnplugged #29: Reflecting on the Market’s Move Up.
Weird earnings reports and the recent upswing discussed. New insights for anyone who invests in anything. What to do? This chat is presented as-is for anyone who wants to listen in. Much more….
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The proposed House health care bill is exactly as Andrew described, “a plan to address the uninsured”. It does not affect the care of already insured individuals. It simply provides an government alternative for those without private coverage. It is based on the “Commonwealth Connector” used in Massachusetts. It is not a single-payer plan. It does not prevent you from seeing your current doctor. It will not cause your Doctor’s office to go out of business. Unfortunately, it also does nothing to stem the out of control costs of health care in this country.
“Loopholes in market rules give high-speed investors an early glance at how others are trading. And their computers can essentially bully slower investors into giving up profits — and then disappear before anyone even knows they were there.”
“…flash orders. While markets are supposed to ensure transparency by showing orders to everyone simultaneously, a loophole in regulations allows marketplaces like Nasdaq to show traders some orders ahead of everyone else in exchange for a fee.”
“High-frequency traders also benefit from competition among the various exchanges, which pay small fees that are often collected by the biggest and most active traders — typically a quarter of a cent per share to whoever arrives first. Those small payments, spread over millions of shares, help high-speed investors profit simply by trading enormous numbers of shares, even if they buy or sell at a modest loss.”
It would be interesting for you to discuss this issue; which category do fall under: one of the slow-moving traders or a user of high-frequency robots? If the former how do you not fall prey to the latter, if the latter how are you different from Goldman Sachs?
http://www.nytimes.com/2009/07/24/business/24trading.html?_r=1&scp=1&sq=high%20frequency%20trading&st=cse
I am highly suspicious of the claims of the cardiologist friend that Andrew mentioned. The proposed public plan would bring in 45 million new paying clients for doctors. Think about that for a minute. (A sixth of the country is currently uninsured). Is this really going to cause the doctor’s office to go out of business?
Safeguards built in to the proposed public plan will make sure it never becomes powerful enough to push insurers/doctors/hospitals out of business making sure people in public plan have access to enough doctors and enough hospitals; if the public plan paid far below what is appropriate for doctors, providers, hospitals to live on they would turn away patients: this is a trigger that says if the number of participating doctors falls below a certain amount there needs to be a review of payment policies or perhaps payments need to go up.
proposals for public plan say public plan will be given start up money to get started but after that it has to sustain itself just like a private insurance company.
The law can dictate that the public insurance option has to pay rates that are some fraction of what private insurance pays i.e. can never be too far below what the private insurers are paying.
In a perfect world a single payer universal health care plan is ideal. If the private insurance companies can’t keep up, maybe they should not be in the business: people deserve good benefits, affordable insurance; if the government can do that better then let it come in and do it.
That the government doesn’t need to make a profit to provide health care is a feature not a bug; there is a fundamental question of whether health care is something on which we should let companies make a profit/make very large profits.
If the presence of a government plan forced all insurance companies to make lower profit margins, that is a perfectly acceptable outcome.
It is notable that specialist doctors like Andrew’s cardiologist friend are the ones that seem to be skeptical of health care reform; Primary care doctors (pediatricians, family doctors, OBGYNs) are mostly strongly in favor of health care reform. Specialists, surgeons, orthopedists, ophthalmologist, etc tend to be what the AMA currently represents (and are focused on the bottom line income issues for their members).