29 Jun 10
Originally posted by USArmyParatrooperIt's hardly a trivial distinction. Most of what you call "investment" adds absolutely nothing to the economy. In fact, the added availabilty of "investment" instruments is draining money that could be used for real investment which would increase the economic production of our society.
Yay, the gotcha game again.
The OP was talking about individuals owning stocks, which has nothing to do with macroeconomics. My bad, I should have said "by every standard and definition as it pertains to an individual investor."
Are you done playing semantics? Let me know when you're ready to have a grownup conversation.
If that's not "grownup" enough for you, TFB.
30 Jun 10
Originally posted by uzlessdon't forget that the company can issue large amounts of stock subsequently, thus diluting your tiny share even further.
Why does the media insist on calling anyone that owns stock or mutual funds "investors"?
Unless you buy a stock at the IPO, you are just buying stock from someone who is selling stock they already own. The money you pay for the stock does not go to the company, it goes to the guy you bought it from! You are just hoping that the stock goes up in price ...[text shortened]... nment regulatory regime, just remember, they aren't investors...they are just speculators!!
or go Chapter 11, wipe out your share altogether, keeping themselves in power, fat, smart, and happy.
30 Jun 10
Originally posted by no1marauderYou're not getting it.
It's hardly a trivial distinction. Most of what you call "investment" adds absolutely nothing to the economy. In fact, the added availabilty of "investment" instruments is draining money that could be used for real investment which would increase the economic production of our society.
If that's not "grownup" enough for you, TFB.
In MACRO economics an investment pertains to the broader economy.
The OP was clearly in reference to the individual investor.
30 Jun 10
Originally posted by USArmyParatrooperI think this is the point of the OP
What a silly analogy.
By your standard if I swipe my credit card for a sketch drawn by Michael Angelo I've also traded "paper for paper"
Both the sketch and the stock certificate are made out of paper.
Just because you have bought a sketch drawn by Michaelangelo doesn't mean you've just created a work of art.
07 Jul 10
1 edit
Originally posted by USArmyParatrooperMon Dieux. Re-read the OP.
Um, yes. Almost all, if not all investments involve risk. There is absolutely nothing in the definition of an investment that excludes risk.
The only time you are "Investing" in a company is when they issue their initial IPO (or subsequent share releases).
Why is this an investment and not speculation? Simple, it's because the money you spend on the stock during an IPO GOES TO THE COMPANY. The company uses your money to expand operations, upgrade processing capacity, expand market share etc etc. In this instance your money helps GROW the company.
If you just buy the stock off of someone that already owns it, you are not giving your money to the company. YOU ARE GIVING IT TO A PREVIOUS SHAREHOLDER. The shareholder just pockets your money. This does not help grow the company at all. In this instance you are just betting, ie speculating, that the stock of the company will go up, or go down if you are shorting it.
In the first case you are investing in the company, in the second case you are just speculating on the company.
Plain and simple.
07 Jul 10
Originally posted by BartsDid I say that? No, you said that. And you'd be wrong. Besides, it has nothing to do with what we are talking about.
So starting a company and hoping it makes money is speculating as well ?
Did you ever get held back a grade while your friends moved on to the next grade?
07 Jul 10
Originally posted by uzlesshttp://dictionary.reference.com/browse/Invest
Mon Dieux. Re-read the OP.
The only time you are "Investing" in a company is when they issue their initial IPO (or subsequent share releases).
Why is this an investment and not speculation? Simple, it's because the money you spend on the stock during an IPO GOES TO THE COMPANY. The company uses your money to expand operations, upgrade processing capa ...[text shortened]... the company, in the second case you are just speculating on the company.
Plain and simple.
On what grounds do you claim an individual investment must benefit anyone besides the person making the investment?
You can invest in rare coins, real estate, art, or countless other examples of transactions between private parties. Your criteria that the company who's shares you are buying must recieve money is arbitrary and made up.
07 Jul 10
1 edit
Originally posted by uzlessAh well, it seemed like you were drawing attention to the "hoping" part quite a bit. Strange that after paratroopers and my post you suddenly say start talking about the difference in terms of who gets the money instead of the risk (or "hoping" ) part.
Did I say that? No, you said that. And you'd be wrong. Besides, it has nothing to do with what we are talking about.
Did you ever get held back a grade while your friends moved on to the next grade?
07 Jul 10
Originally posted by uzlessHow exactly does it matter to who I am paying ?
Mon Dieux. Re-read the OP.
The only time you are "Investing" in a company is when they issue their initial IPO (or subsequent share releases).
Why is this an investment and not speculation? Simple, it's because the money you spend on the stock during an IPO GOES TO THE COMPANY. The company uses your money to expand operations, upgrade processing capa ...[text shortened]... the company, in the second case you are just speculating on the company.
Plain and simple.
If I buy stock at an IPO, then I'm investing and the company gets money.
If I buy stock from someone else, I'm investing in the company and the other person is dis-investing in the company, just because the total of this transaction is a zero sum doesn't mean that one side can not be investing.
The terms speculating and investing are not mutually exclusive though, so if you want to call stock trading speculating, feel free to do so. You'd probably be right most of the time if you want to characterize it as such.
08 Jul 10
Originally posted by PalynkaLanguage makes all the difference. It can obfuscate the truth and make people think things are worse, or better than they really are. "Right-sizing" instead of layoffs for example.
Who cares what you call them/it? Why does the name make any difference?
By calling anyone who owns stock an "investor" it sounds better than "speculator" Would anyone care if a "speculator" lost money? Would we be insisting on bail-outs for "speculators" who speculated incorrectly? Of course not. But call that person an "investor" and suddenly the company is supposed to cater to the "investors" needs and drive stock price up, regardless of at what cost.
By calling them "investors" it lends some kind of legitimacy to them. Call them speculators and no one would give a rats ass about what they want companies to do.
Language is important. It controls and dictates how people perceive issues. So, call this group of people what they really are.
SPECULATORS.
08 Jul 10
Originally posted by BartsNo, I was talking about who gets the money straight from the Original post. Don't blame me if you can't read properly.
Strange that after paratroopers and my post you suddenly say start talking about the difference in terms of who gets the money instead of the risk (or "hoping" ) part.