"We're supposed to help OUR people, starting with our stockholders, Yea Forums! Who's helping them out, huh?"

THAT MAN IS GETTING RAPED

Is he dressed as a clown?

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I want to understand how they work. I’ve got a lot of money sitting in the bank doing nothing and I’m still living with my parents and stockpiling money into my savings for no reason. I really should invest just a bit.

Index funds are safe and reliable, pick one of those.

Banks are long term investments. Stocks are short term, with big risks.

and when they go down you have pink wojaks and suicides.

You used to be able to make money off them 20 years ago but now everything's done by computers and you can't beat them.

This was the original premise.

A long time ago people complained that corporations and large businesses being controlled by a single person who could be a dick about how he ran his business, and no one could do anything about it. So people came up with a solution.

Instead of a company being owned by one rich asshole and leave its control in the hands of one guy, the company could split up its ownership in the form of "stock" that any person could acquire. Having a stock (represented in paper form like money) gives you a piece of ownership and thereby allowing you to have a say in company decisions. The more stocks you own, the higher percentage you would have in owning the company. The stock market was created to allow people to congregate and buy or sell ownership for certain companies in order to create a fair economical environment where the people would have direct say in corporate affairs.

If a company was doing well, a stock would be worth a lot of money, but if the company was doing badly, a stock's value would drop to reflect the company's value.

At some point people realized that because of the fluctuation of stock prices, you could make money if you bought a cheap stock, waited for it to become valuable if the company did well, and sell it off to make a profit from doing absolutely nothing.

Then the whole system started getting fucked from everyone trying to get rich quick, and now the stock system is filled with thousands of hours of mental gymnastics, batshit insane terminology, and nonsensical rules and legal tape. This dumb fuckery helped cause the stock market crash because everyone was so dependent on stock trading to be vital part of the economy instead of production and labor, and even today no one wants to get rid of the system entirely because you still can make money off it if you're business/finance savvy.

Nah. ICP.

the insane levels of growth generated from rapid investment into industries has benefitted mankind far more than the downsides of it, you know.

We literally would have never gotten airplanes if people didn't go I WANT A PIECE OF THAT FUCKING PIE

And why do we allow for profit insurance?

More pertinent, you can't get rid of the stock exchange without fundamentally altering how corporate ownership works. Also checked.

>brainlette
London?

>Having a stock (represented in paper form like money) gives you a piece of ownership and thereby allowing you to have a say in company decisions.
So does this mean that a person who doesn't work for the company or have any knowledge on the industry that the company works in can make decisions for that company as long as he buys tons and tons of stock?

This is why co-opts are a moral form of corporations. The company belongs in the hands of the employees, or at least the need some sort of stock in the whole thing.

Yes

You own a fraction of a venture.
Usually, you'll receive dividends, a proportional fraction of the profit.
But even if you don't, your stocks can still raise in value, if the enterprise you own a part of gets more stuff in it.
The stockholders are the "owners" of the company, and responsible for what goes on in it (even if they've delegated all the decision making to a CEO), when a corporation goes under all the creditors who loaned money get payed out first and the stockholders that invested money get what's left.
Stockholders get to say what happens to a company, they elect a board of directors to represent their interests and control the chief officers (who are led by the chief executive officer, the CEO)
The value of a stock can be calculated as the quarterly dividends divided by a value that's the currency's inflation rate minus the company's growth rate.

The rise of high traffick stock exchange saw the rise of traders wanting to inflate the value of their stocks in the current quarter with short term growth and then sell it. Which is why corporations get a bad name, they're strongly incentivized to go for profit in the short term and ignore the long term.

The concept of fractional ownership of an enterprise rose to prominence amongst the dutch, who had to work together to win land from the sea and had to find a way to reward each investor appropiately without dividing it up in unuseably small chunks.
This monetery strategy allowed them to build the first really big ships and begin a golden age of global trade.

A corporation is a firm that can sell stocks, there are other types of firms; sole proprietorships, parternships and LLC's where this is not possible.

There, that's all I know.

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>A long time ago people complained that corporations and large businesses being controlled by a single person who could be a dick about how he ran his business
literally large business couldn't exist without stocks.
Also corporations can't exist before the existence of stocks, by definition.

>mfw I come for the shitposting but leave with new knowledge of financial systems.

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Investors can form portfolios of different stocks.
Each company can be ranked on a two-dimensional plane of average returns and volatility. Which you can call risks versus returns.
Of the companies that are worth investing in, the higher risk will correspond to higher returns.
By 'diversifying' a portfolio, meaning to invest in different stocks whose success is not dependent on each other, investors can create portfolios with a risk that is functionally less than each of the component listings.

In the capitalist system capital is considered a production factor, the same as labour or land, and companies can calculate their 'cost of capital' like its wages and rent costs.
The capital can come from two sources, equity (investors) and debt (loans). Founders that supply their own materials at the creation of the firm are also investors.
By default, the cost of capital is the weighted average of the dividends and interest of loans depending on how much of the capital comes from each source.
But a lot of money a corporation handles is taxed twice, once when it earns it, and once when it rewards it to its stockholders, this is called the corporate tax. The corporate tax reduces the weight of loan interest in the cost of capital. Because money given as interest for loans isn't profit and money given as dividends for investments IS, the former forms a tax shield.

Because of these corporate taxes, corporations are incentivized to take on as much debt as possible to stay competitive. But if they go too far, they will default on their loans and go bankrupt.

Investors and chief officers have different incentives.
Investors care about the short term, and the profitability of a company.
Chief officers care about the long term, and their own prestige and career.
High debt can also help keep chief officers in line, keeping them from spending money on prestigious projects that do not increase profit or give themselves big bonuses.

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its just gambling with partial ownership of companies

When a corporation gets bought out, the investors are happy, because they get a big payout.
The chief officers are unhappy, because they're under new management and might get fired.
Chief officers will try to find ways to prevent buyouts, the board of directors will fight that.

An example: unilever almost moved their main office to the Netherlands, when they promised to abolish corporate tax, this would have been immensely profitable to do. But the board of directors voted against it, the Netherlands has strong anti-trust laws and would have prevented future buyouts.
So that's a case where stockholders might decide against profit.

Many people that start a corporation will keep a majority share so they don't have stockholders telling them what to do.

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Yeah, I'm too much of a brainlet for the stock market, so i'm just going to get a CD account.

>ITT
youtu.be/if-2M3K1tqk

You don't need to have any understanding of investing strategies and day trading going through life.
You just need to know what they are and do, and hire a broker if you're rich.

1.Mr Incredible worked for an insurance company and his job was to find reasons to deny pwople coverage they paid for in order to save the company money. This is a real job and it was a good choice for a depressing and negative job.
2. Stocks are portons of ownership of a company. Just like how someone and their business partner can both own 50% of their company, they can split that 50% further and sell, for example, 100,000 people .0005% of the company (a share). Those people buy these small shares at proces based on the company's value, and if the value goes up they can sell it to someone else for a profit. Stockholders are given cash dividends occasionally at the business's discretion, and are able to attend a meeting where the owners report their progress, and they can petition for things to be done in the company by leveraging the value they put in via the stock

No offense guys but out of all board here, Yea Forums knows the absolute least about life, and is the most immature board

I think it was explained pretty well ITT.

Kind of a dick representation of insurance companies since they pay out their customers insurance claims regularly without issue and only hold off on false claims that they do a good job of investigating before denying.

>Kind of a dick representation of insurance companies since they pay out their customers insurance claims regularly without issue and only hold off on false claims that they do a good job of investigating before denying.

I have to assume you are underage B& and have never seriously dealt with a major insurance claim. Do you have any idea how many "reputable" insurance companies like State Farm have lawsuits against them by the States????
Publicly traded insurance companies were a mistake. There is ABSOLUTELY no reason for them to be publicly traded entities, it serves no purpose except for the executives of it to "hold" onto premium funds, and invest them to get rich off of them.

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you know why everything in America is the way it is?

because all the people on /pol/ who talk about how capitalism is the perfect system, when they come to Yea Forums and they're all "how DARE they use cheap CalArts style/pander to SJWs/start yet another streaming service?" For profit.

Just keep consuming, Yea Forumsnsumers. And remember, nobody on Earth is allowed to try socialism of any kind.

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You should. Right now the Inflation rate is around 2% If you get less than 2% back from the bank's savings account then you are losing money. You should have enough in the bank to cover your bills and enough in savings to cover three months of expenses as an emergency fund and after that you should invest. I just started investing seriously this year and have an 8% return so far. Of course stocks are only worth what you cash them out for so that could change.

Bob is. The shady shit the boss was suggesting Bob do would absolutely tarnish any publicly traded company's value.

I had to make a claim just last year, it went fast smooth and efficient. Maybe you're just a bad investment.

>you know why everything in America is the way it is?

Because a bunch of very wealthy and powerful people have conspired to make themselves even more rich and powerful at the expense of literally everyone and everything else.

Socialism isn't going to remedy bad taste.
Which is what you're really complaining about, vapid products being successful

I'm really bad at economics because I've never understood the value that stock, and the inflation of it's value holds versus say, actual profits

I mean sure, getting investments in is great, but it's not so great when they start throwing their weight around in ways that fuck up your ability to function as a business that turns an actual profit VS being a weird slight of hand trick that exists to "invent wealth" for your stockholders

The entire notion of economies and money is really a sleight of hand trick, so when people want to press the illusion harder than it already does by default, by existing, I get skeptical, but that is also probably why I am dirt poor

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But who are you going to sell them to at the high value?

America is literaly a tax evasion scheme.

That's an interesting pep talk that Bob should have recorded and reported to HR.

I just think it's wild mass guessing based off of assumptions of assumptions compounded over generations of assumptions.

Why else would a post on a shitposting website like twitter have any impact on it?

people who think it'll get even higher so they can do the same

Lmao as if HR would ever do something. HR is not your friend.

To put that clusterfuck in very simple terms you are basically gambling on that company being financially successful and you getting a piece of the pie.
You sell them to whoever wants it, typically because they think that value will get even higher someday so the process repeats.
>implying HR is ever on your side or would do anything

idk

...

Sounds like the same scam bitcoin was. It will never work.

>you getting a piece of the pie
well... no. You only get Money out of it when you sell.

it's kinda like gambling but you funnel money into a company and you wait, you will either lose money or gain money depending on how much money the company makes

>it's kinda like gambling
It's more like betting on horse than pure randomness, though.

>workers literally possessing the means of production
>the literal definition of socialism
Hmm maybe it aint so bad after all!

They're haggling in disguise so that people can get away with the verminous practice in broad delight despite taking place in a society founded on decent and fair conduct. Here's why that matters.

Fair conduct means that one rule applies to everyone, as per the situational stipulations of the rules. There are no double standards, and law makers and enforcers do not have fiat. This is reflected in many aspects of civilisation such as shops having set prices. Everyone who walks into a Tesco or 7-11 and buys a sandwich pays the same price as anyone else does. Sandwich prices can vary based on circumstances, such as corner stores charging more or price changes over a long term, but ultimately a sandwich is a sandwich.

Haggling predates the fixed price shop, being a more primitive system. Primitivity means that less coordination or cooperation is needed to create a system, making it more robust for situations in which parties do not trust each other. Two enemies can be made to get along via haggling over a price for instance. But for a higher civilisation it is a primitivity that actively hurts trust. For any given buyer, there is the dangerous possibility that the seller is a ripoff merchant who's trying to overcharge you for junk. And for every buyer, there's a seller who's worried his customer is a cheapskate trying to undersell his valuables. Both are motivated to behave in a low and nasty fashion to try and ward off the prospect of being taken for a mark. And in practice, when everyone is forced into defensive savagery, everyone suffers. No trust, no cooperation, no higher civilisation. It's the proverbial "reason we can't have nice things".

When you study the stock market, it's all essentially the insidious return of haggling in a newer, more powerful format. The essence is attempting to buy stocks low and sell them high. This is dependent on identifying that a stock is going to be seen as valuable soon, so that it will be high for good selling.

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Know the industry that you invest in.

But importantly those stocks must be *currently* seen to be low, because otherwise you wouldn't be able to buy them cheap. In totality, a stock must be presently seen as worthless, but are about to be seen as great, AND you must identify this in advance.

See the problem? Unlike in a fixed price situation, where a fair exchange is ensured, this system of stocks gaming requires someone to be a sucker. In order to make a killing, it's not enough for you to correctly identify whether a stock is going to be seen as valuable shortly. It's actually 100% crucial that the poor sap selling you the stocks believes the opposite - that his current stocks are worthless and he should shed them. Because if he didn't, why would he sell them? He'd hold onto them naturally and proceed to making his own killing.

So if you go into stocks trading with a trusting attitude and go about sharing information with fellow traders, you're going to be raped harder than a naked 12 year old alter boy at a Vatican orgy. You'll end up showing your hand to every parasite on the market, and end up getting a feed of misleading gibberish back, resulting in you being tricked into shedding valuable stock for mere pennies and getting sold junk for exorbitant prices. And the law turns a blind eye to this nastiness out of a mixture of cynically-concocted sophistic gibberish to justify the entire exercise as "fair" in a perverse darwinianism, as well as plain old corruption.

The moment we can nuke the stock markets and remove the speculative subterfuge and well-disguised leeching that occurs in the world of contemporary capital, the sooner the world can be cured of many, many ills.

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Do stockholder get a percentage of the profits of the company?
Why are companies obsessed with trying to satisfy the stockholder? If they don't think the value increases they just their losses and sell the stocks out for the cheap and thus decrease the value of the entire company?

It’s like horcruxes but with companies.

ITT

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>we need to get rid of stock markets because some people are idiots

They get a dividend. Companies are obsessed with pleasing the stockholders because stockholders can dictate the direction the company takes and force out executives through the board of directors. This is compounded by activist investors, which are investors who buy stock specifically to manipulate the actions of the company.

If only we took away the ability for people to consolidate their efforts into larger ventures, we could be living in a utopia.

Is dividend fraction of stocks or far less?
E.g. if the company has 1000 stocks, and I own 10 of them, do they pay me 1% of their annual profits?

Alright, let’s settle this with a wager. I have here iocane powder. Colorless, flavorless, completely undectable and one of the deadliest poisons on the planet.

Dividends policy is different per company.
What's important to note is that the money you're getting is your own, it goes out of the company's total worth so it depreciates the value of the stock by the exact amount it hands out.
Because you're a co-owner of all the company's assets, and a proportional amount of those assets have been taken out and handed to you.

Okay, thanks.

>get out of stock broking to get into funding art
>its literally the same exact thing but with taxpayer money
>fuck it, I'll go for fine arts
>even fucking worse to the point that it actively worsens the economy
>eventually realize that art is basically legal money laundering and that trading stock is unironically less immoral and less greedy because at least you're dealing with people willingly giving away their money instead of people stealing money from taxpayers and pretending they're a legitimate for profit business

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