What is the Point of the Stock Market?

Posted in Uncategorized by Protopop on October 8, 2011

I think The stock market in its current incarnation is having a negative impact on society. I”m not an economic expert, so this is based on my common sense  experience as a 39 year old reasonably intelligent person. And please, if you know better feel free to educate me , without any insulting lip.


From what I understand the IPO is the equivalent of selling your soul for a price. Companies only make money when they first sell their stock. After that it’s investors who benefit, not the company. And I’ve seen many stories about investor profit becoming the main goal of any company after that. Why would you let people who have nothing to do with your company basically dictate it’s direction?

Real Money

Furthermore, it’s not real Money. The wealth of the stock is a valuation that is not concrete. It isn’t earned by working for it. Your money grows while you sleep. And according to the economics of opportunity cost,  that wealth is coming from somewhere. Wealth comes from someone’s hard work somewhere whether it’s from you or not.

Active Investors

What the stock market needs is more active engaged investors who truly care about the company they are supporting, who don’t expect huge returns out of line with the average,  and are educated about their investments. I can’t believe an investor with a portfolio of thousands can truly be knowledgeable about the day to day workings of every company in their portfolio.

So, aside from generating profits for disengaged investors and giving them a huge say in the company, what is the point of stocks? Of course for some people that may be reason enough.


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