I think some of you guys are really mixing apples with oranges. There are many commentators saying different things and I can't keep up with who had said what so I won't quote them.
First off: The game theory. It is not my definition. It is the definition by mathematicians. I quoted something posted on wiki on the definition of the game theory.
In a pure zero-sum game, as modeled in the game theory, it is a closed system. The winning players are paid off by the losing players. This is ignoring the house taking a small cut. (Or assume we have no house. Just players against players.)
I said from that point of view, the futures market is a zero-sum game but the equity market is not a zero-sum game.
If you add commissions taken by the brokers, then it definitely is a negative-sum game (I doubt if any dividends in the world added together can weigh more than all the commissions charged). Slippage: that's actually the gain by market makers or specialists (or other traders). They brought money to the pot too so you can't count them as a drain.
Again this is from the point of view of looking at the equity market itself. This is a never-ending game. You can see the appearance of a perpetually inflating stock price on a given company. You can say nobody is losing money. Because the game has not ended. If one has to pick a loser, it would be the last person who just bought the stock because, presumably, he brings in new money. But this is not the end, because he hasn't sold yet. The company may go bankrupt, or the stock price may go higher still. From the perspective of the game theory, being a zero-sum would mean those who sold their stocks, their money must come from the pot - contributed by the new players.
Can the stock prices keep going up forever? Yes. What explains it and what rules govern it is outside the scope of the game. (You are talking about inflation, and at some point a reset (devaluation), etc..)
The housing market is different. One key is: the "value" of a house, or all houses, is created through credits. For every $100 you put in a bank, the bank takes your deposit and lend out $90 to other people. Who in turn would lend out $81. Who in turn would lend out $72.90 and so on. And in bubble environment, some lenders even broke the rules. So in this game, someone is constantly creating more chips.
And when the housing bubble bursted, who stood the gain? Are you kidding??? Don't you realize there are plenty of homeowners, who got lucky or whatever, sold their homes at super inflatted prices? Like everything else, house prices can only continue to go up if there are demands for them. So far this world's population is still growing so it may not be a concern (at least not an immediate one).
