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I've always liked Leonard Wibberley's idea from "The Mouse On Wall Street": buy stock in a company that's headed towards bankruptcy. As the stock price continu
by ThrowawayR2 7y ago
I've always liked Leonard Wibberley's idea from "The Mouse On Wall Street": buy stock in a company that's headed towards bankruptcy. As the stock price continues to fall, your money essentially vanishes into thin air.
- thrwaway69 7y agoIsn't that redistribution? Aren't you sweeping debt of the bankrupt company by buying its share thus pumping money into the economy? or am I missing something here? How will it vanish into thin air?
- ThrowawayR2 7y ago> "Aren't you sweeping debt of the bankrupt company by buying its share thus pumping money into the economy?" In theory, the shares at the time of purchase are worth the amount of cash that the market price is. The owner of the shares may realize a net gain or loss relative to their own purchase price but that doesn't change the fact that $X of shares are being exchanged for the equal and equivalent $X in cash. So what is being redistributed? > "How will it vanish into thin air?" As the shares trend from price $X to zero, where does the value go? Answer that and you will have answered your question.