The Stock Market is (NOT) a Ponzi Scheme
- Get link
- X
- Other Apps
The following is the response to what seems to be a new class of videos on YouTube, driving engagement through dislikes using blatantly false information.
The amount of misinformation in this video is simply shocking. Where to even begin?
Par value comes from bonds, and is simply a regulatory figure for stocks. Common stock holders still have first rights to business profits, surplus liquidation proceeds etc. They own the company's assets and income, regardless of dividends and voting rights.
John Bogle once accurately said, "The stock market is a giant distraction to the business of investing". But this video describes exactly why the stock market is necessary at the same time. It provides liquidity for monetizing business profits, especially for non-dividend-paying stocks.
Good stocks represent fractional ownership of income-generating businesses, and are backed by inflation-hedged assets. Modern fiat currencies have neither.
As for equating cash inflow with market capitalization and other baseless arguments made here, perhaps it would be best to end saying that investing is an advanced science with potentially extreme consequences.
No one should get into it, or dismiss it, so lightly.
Par value comes from bonds, and is simply a regulatory figure for stocks. Common stock holders still have first rights to business profits, surplus liquidation proceeds etc. They own the company's assets and income, regardless of dividends and voting rights.
John Bogle once accurately said, "The stock market is a giant distraction to the business of investing". But this video describes exactly why the stock market is necessary at the same time. It provides liquidity for monetizing business profits, especially for non-dividend-paying stocks.
Good stocks represent fractional ownership of income-generating businesses, and are backed by inflation-hedged assets. Modern fiat currencies have neither.
As for equating cash inflow with market capitalization and other baseless arguments made here, perhaps it would be best to end saying that investing is an advanced science with potentially extreme consequences.
No one should get into it, or dismiss it, so lightly.
Baseless? Sorry but that was spot on! If the stock market was real it would have crashed when the world shut down and nobody produced anything. Why didn’t it? Because it’s a huge ponzi with numbers not backed by anything other then someone’s willingness to buy air. Lol
While the economy did slow down, the only businesses that actually shut down were the customer facing ones such as retail and travel. Most of the real economy today happens in the background. Essentials and supplies were still being produced and delivered.
The same goes for the stock market. Most trading now happens online, and not on the exchange floor.
While a large number of popular stocks truly have poor underlying foundations, the system is based on solid economic principles which most people don't bother studying.
The same goes for the stock market. Most trading now happens online, and not on the exchange floor.
While a large number of popular stocks truly have poor underlying foundations, the system is based on solid economic principles which most people don't bother studying.
Asset-backed income-generating stocks are always better investments than real estate; and way better than fiat currencies and cryptocurrencies, which truly are nothing more than thin air.
- Get link
- X
- Other Apps
Comments
Post a Comment