GreyICE wrote: ↑Sun Feb 07, 2021 9:50 pm
BridgeConsoleMasher wrote: ↑Sat Feb 06, 2021 10:17 pmThat's like saying "if I drop my money in the gutter and it streams down the sewage drain, then where is the value in that as a commodity." Gamestop is recognized as a bubble and the stock market is going to patch some holes in the form of more efficient trading provision via the SEC policy etc.
In the case of Amazon, their capital funds probably aren't particularly bottlenecked. So other than your own personal investment, trying to make a difference in the world by investing in them would be very negligible just based on that. Nonetheless of course they could need more capital for whatever they're doing, and $20 is $20 + i.
In the case of you and Robinhood traders, investing your money in the stock market is actually a practical short, mid, or long term personal financial regimen, given interest has been at the floor since the meltdown.
Oh I see your misunderstanding! You think that people buy Amazon stock from Amazon! You're confusing stock and bonds.
When you buy Amazon stock you're not buying it from Amazon, and Amazon receives no money. There's no benefit to a company whatsoever when their stock is traded. It the stock goes up, it goes up. If it goes down, it goes down. The company itself remains unaffected.
This is why the stock market is such absolute cancer on American society. Many people share your misconception, and it results in them thinking what the investor class is doing is okay.
As a small investor with a personal investment account, a retirement IRA, and nearly a decade of experience in both traditional stock and crypto trading there is so much wrong with this.
Firstly the price of a stock going up is absolutely a benefit to the company that issued it. If the share price goes up it provides the company with greater capital flow and allows them to take advantage of capital offers while also increasing the value of the assets of the various share holders, and the company itself. It also creates collateral that the company can use to take out credit against. (i.e. a
collateralized loan)
Buying shares in a company also means that you literally own a portion of that company. whether it's a fraction of a single share or millions of shares you own a portion of the company equal to the size of the share ratio that you own. As a result you have the right to vote in company decisions, and the weight of your vote is based on ratio of shares that you own. I know this because I routinely receive emails informing me of upcoming board votes and asking if I have an opinion and do I wish to cast a vote.
Want an example? Apple. Apple is constantly running into trouble with government agencies, both US and foreign, when it comes to them handing over customer's private data. Now in the last few years Apple has had it's arms twisted into compliance in certain areas but generally they take a strong stand in that regard and rarely back down. Why? because that's what the shareholders voted for. I own Apple stock, not very much, but I own some regardless (They pay a fairly nice dividend).
Now you ask "well why do companies always make decisions that harm small investors and regular people" Well it's simple, the 1980's happened and in the space of a decade the US's largest industry became financials. As a direct result of this it became very hard (or perhaps frustratingly complex would be a better way to say it) for regular folks to buy, sale, and trade stock. Then comes the fintech revolution, and suddenly anyone with some patience, a willingness to learn, and has ten or fifteen bucks sitting in their account at the end of the week could suddenly get involved.
You see because of financialization up until only five years ago or so, most stock was owned by a fairly small number of people, and in turn it was these people who set the direction of the company, but now millions of millennials are flooding into the market and sucking up all the spare stock, this is why the stock market has boomed by the way (that and stock buybacks but the arguments I've seen over which has had the biggest effect are both amusing and often undecided). While the real economy has lagged, billions of dollars of spare cash and stimulus checks have been flowing into the markets. Stocks, just like any other asset are affected by supply and demand, we've been seeing a lot of asset shortages over the last ten to twelve months and as a result prices keep going up, and the number of shareholders is rapidly increasing for the first time in decades. We are witnessing history, as the old, grumpy, stick in the mud conventual traders on wallstreet are being forced to come to terms with this. They don't like it but they have no choice. Decentralized finance is here to stay and eventually wallstreet will either adapt or go extinct.
