661–670 of 898 posts
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While you're not really wrong in your assessment, please take the time to post a more substantive, less flamebaity comment.
Get rid of the wealthy and enjoy becoming the USSR?
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The point is they are participating in the stock market and benefiting from its gains.
I mean, if 0.1% of your savings is in the market, you're "participating" in some sense, but not with any real impact. My sense is that, for the great majority of people in the United States, the stock market's value doubling would mean little for their financial health. Having a retirement fund that goes from $10,000 to $20,000 (or even $100,000 to $200,000) has a relatively small impact on the prospect of retiring […
just like voting has no real "impact" right?
Participating has an impact. The impact may not be as big as you'd want, but it's there. and it's better than not participating.
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I agree. Also, I know it is hip to say that Wall Street is short-sighted, but in reality it is one of the the few fields where people routinely think decades at a time. If you run a large pension fund or investment account you were already risk-weighted and if the cash isn't needed for 10+ years you'd much rather own a slice of the world's largest companies ten years from now instead of gold or cash under a mattress.
I feel like there is a decade of guillotines in the future that they are either not seeing or are looking way past. But then I've always been cynical about the growing divide between the uber-wealthy and the other 99% of this country.
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Which is a good thing to me. I’d rather people “work” to earn rather than easily collecting rent through interest. Work in quotes since applying capital in risky investments is work compared to stashing money in an interest bearing account.
What? Putting money in an index fund, or buying Apple stock, or a 401k, is "work"? Companies don't even get the money from secondary stock purchases, so the invested money is doing absolutely nothing. Banks use deposits to create loans whose funds go directly to the companies receiving those loans. Banks which interview the loan applicants, review financials, ask for references, and which themselves tend to be pillar…
that's absolutely not true.
The buying stocks (or indirectly via index funds) must mean somebody else is selling.
The person who sold the stocks will put the money obtained from the sale to use somewhere else. It moves capital just like any other economic transaction.
It may be that the seller will "just" buy another stock - and it looks like nothing's changed. But eventually a seller down the chain is either going to invest in something other than stocks (e.g., a bond), buy new IPO stocks, or to consume the money (e.g., retiree selling stocks to fund their living cost).
The problem with banks doing loaning is that they have to be conservative. They cannot loan out money that might not return - since they must return their depositor's money.
Investors, on the other hand, do not have this conservatism (for the right price). That's why stocks exist, and that's why bonds exist (for those willing to risk less than stocks).
> And as has often been the case in recent years, investors find themselves faced with few attractive alternatives if they opt out of betting on stocks. The problem is so familiar it has its own acronym: TINA, or There Is No Alternative to stocks. Cash: Gets eaten away by inflation. Although the CPI doesn't indicate high inflation it only measures consumer goods. Inflation is there in the price of investments. If you…
- bonds: Definitely not 0% interest rate, definitely better than cash. You can expect around 1.5% in the US for IG bonds. This is all relative to the default risk of course, the stronger your central bank, the less risky are the bonds, the less interests you earn.
- Real estate: you don't have to own it directly. This exposes yourself to a huge idiosyncratic risk. You can easily get real estate exposure while maintaining diversification and liquidity through REITs, which are trendy since at least 10 years.
There's a whole lot of other investments if you dare to look into it. You can play with currencies (FX, IRS) if you have macroeconomic views. You can play with debts (CLO, CDS) if you have views on the corporate debt market, etc.
> Measures by the Fed and U.S. government have underpinned the recent rally across markets. The Fed made it clear it was willing to step in to buoy the economy. Why bet against the market when the central bank is willing to do that? The Fed has gone far further than just this. The Fed is going to buy as many assets as it takes. Treasuries. Corporate bonds. Junk bonds. Munis. It'll buy the assets directly. It'll buy t…
Trivial to offset by giving free money to people. The problem is the Fed can't get most of it back. While assets in their balance sheet will hold some value.
Of course, once you start giving free money you destroy societal incentives and get a much bigger problem. Productive people switching to "cabin in the woods" mode.
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It's the classic Trump small loan of a million dollars scenario. Sure not many are as lucky as Trump was. But even t hese examples of blue collar success have a bunch of luck in them. Not everyone can start a machine shop with their dad, or own or even operate a taco restaurant. You need to be at the right place, the right moment, have the right amount of money and or the right equipment, interests and skills. And on…
For the common person it's a lottery just to be allowed to work at Taco Bell and do what the Taco Bell handbook tells you? And then, once you become a manager to save your pennies until you have a down payment on your own store? Gimme a break man.
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I don't see how they would help. There's a common refrain among Reddit socialists and whatnot about the rich sitting on some mythical "pile of resources" that needs to be redistributed, but even if you suppose that we guillotine the rich I don't think the poor can eat stock certificates. What are they going to do if they dismantle, say, Wal-Mart? Now all the people who worked there have no jobs and the people who sho…
How about ripping Wal-Mart apart and replacing it with what existed before - many different shops, each owned by a local person, and many different logsitics networks, each also owned by someone in the area? People on the right often claim to be for the free market and for small, decentralized government, but then turn around and love big, centrally planned conglomerates,just as long as they are owned by share-holder…
You underestimate, vastly, just what they've done to their supply chain, distribution network and logistics to make it that efficient and therefore cheap for their customers. It's part of the reason people switched from buying from local shops and went to them instead.
I chose them as an example because business people know a lot about what they did and the general public doesn't have a clue. I don't even like Wal-Mart, but I'm also aware of some of the reasons they're so successful. They're literally studied by people who study supply chain management because of what they did, e.g. -
https://www.skubana.com/walmart-leading-way/
I used them because it's fashionable to hate them, but anyone who knew what they had actually built that's not visible to the public would know that it's not something that you can just replace that easily. So that lets me separate the replies according to how informed they are.
Finally, your attempt to connect large companies to "central planning" is at odds with the fact that one works and the other does not. Central planning doesn't work because different people have different needs and no single plan can accommodate so many unique individuals. I don't think you will find many businesses that aren't planned, but they're not managing so many unique needs, either. And in those times when they really do end up in a situation like that, they end up being spun off as separate companies for that very reason.
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But the top 1% own much more than 37% of the wealth (and accordingly receive much more than 37% of the financial benefits of government spending) while only paying 37% of the taxes (which fund that government spending).
> and accordingly receive much more than 37% of the financial benefits of government spending what?
I work at a big tech company. One of the big realizations we've made is that WFH is not killing our productivity - it may actually be increasing it. If that is widely true, it has huge implications, and points towards an enormous amount of value that can be unlocked, by allowing professionals to work wherever they want (presumably in lower CoL locales). This article indicates that the housing crisis costs the US econ…
I don't know. I work in tech and almost everyone I know is finding themselves less productive and can't wait to get back to the office. Maybe because most of us live in an apartments and not magestic houses with woods or lakes behind them, and the feeling of being trapped indoors is neither healthy nor pushes one to work more effectively. My PC is in my living room and I'm on it, in the same seat, at the same desk, u…