All that money you've lost — where did it go?

NEW YORK - Trillions in stock market value — gone. Trillions in retirement savings — gone. A huge chunk of the money you paid for your house, the money you're saving for college, the money your boss needs to make payroll — gone, gone, gone.

Whether you're a stock broker or Joe Six-pack, if you have a 401(k), a mutual fund or a college savings plan, tumbling stock markets and sagging home prices mean you've lost a whole lot of the money that was right there on your account statements just a few months ago.

But if you no longer have that money, who does? The fat cats on Wall Street? Some oil baron in Saudi Arabia? The government of China?

Or is it just — gone?

If you're looking to track down your missing money — figure out who has it now, maybe ask to have it back — you might be disappointed to learn that is was never really money in the first place.

Robert Shiller, an economist at Yale, puts it bluntly: The notion that you lose a pile of money whenever the stock market tanks is a "fallacy." He says the price of a stock has never been the same thing as money — it's simply the "best guess" of what the stock is worth.

"It's in people's minds," Shiller explains. "We're just recording a measure of what people think the stock market is worth. What the people who are willing to trade today — who are very, very few people — are actually trading at. So we're just extrapolating that and thinking, well, maybe that's what everyone thinks it's worth.";_ylt=A...

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...what I value and what someone else values can be different. I may think I am doing a "great" job, and ask for a raise. My boss feels I am doing a poor job, and tells me to take a walk. I think this is something teachers should keep in mind in their negotiating for raises.

It will be interesting during the next few years. Is my home as valuable as I thought it was, or can't I find another fool to buy it? Am I as valuable to my employer as I think I am, or am I just a piece of "sh-t paper" to be used and thrown away? Can I go out on my own and start a business, compete with everyone else trying to run a business, and have the business smarts to make a living as my own boss? And for those who can't do these things where is the "trash heap of history" located?

Old South End Broadway

The production of a pack of Greater Fools should never be called "wealth". Those trillions never really existed. If you think they did, take these stocks as legal tender in lieu of real money the next time someone offers them to satisfy a debt. I bet that you won't.

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