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"Investments that don't pay dividends are essentially pyramid schemes" No. 'Dividends' do not matter. The cash going into the companies bank account belongs t
by alexasmyths 9y ago
"Investments that don't pay dividends are essentially pyramid schemes"
No. 'Dividends' do not matter.
The cash going into the companies bank account belongs to the shareholders, and it's reflect in the stock price.
When a company gives out $1 in dividends, it's valuation goes down by $1.
Technically, dividends don't matter.
In reality it's a little different, and dividends mean certain things, mostly about the companies ability to generate returns with that cash than you, the investor.
And FYI - there can be 'unlimited growth' - as long as there is innovation, and 'stuff keeps getting better' - we will see growth.
- bykovich2 9y ago> There can be 'unlimited growth' - as long as there is innovation. How's that work, bud?
- alexasmyths 9y agoUhh, look around: almost all economic growth is derived from innovation. The entire medical industry's growth is based on innovation. Do you think the medical industry is growing because it's 'digging more resources' out of the ground? 'Cutting more trees'? The entire financial industry, basically all of high tech. Education. Very few sectors depend on 'natural resources' for growth. And even for some that do, it's minimal. Most materials are abundant anyhow.