5 ms·

Just spitballing here, but I'm thinking the bottom 90% doesn't own much stock due to lack of funds. Not because they don't know how or because transaction fees

by jjeaff 7y ago

Just spitballing here, but I'm thinking the bottom 90% doesn't own much stock due to lack of funds. Not because they don't know how or because transaction fees are too high.

WalterBright 7y ago
You can start investing in stocks for as little as $1. Lack of funds is not the problem.
- nitrogen 7y ago
  If I only have $2, why would I put $1 in stocks when I could put all $2 in food?
  - WalterBright 7y ago
    You can always find an excuse to not invest.
    - nitrogen 7y ago
      I'm saying that when you are on the edge of being able to feed yourself, investing in anything other than being able to eat is the wrong call. I have actually been in that position. It also seems kind of silly to play with $1 in the stock market; I'm going to make like 8 cents in a year on average with a high variance, while if I bought food I would be able to work using those calories and maybe earn $8 in the time it took to burn those calories.
      - xyzzyz 7y ago
        Ah, the bottom 90% of Americans, ever on the edge of being able to feed themselves.
      - manigandham 7y ago
        It's pretty clear that we're discussing the far greater majority that actually can feed themselves and have money left over to invest. Also people go through different stages in life, as you claimed in your comment. You might have been too poor before but I assume you can invest now right?
        WalterBright 7y ago
        My iphone is 4 years old now. I've saved a ton of money not buying the latest every year, money I invest.
      - WalterBright 7y ago
        The freeways around here are gridlocked every day with people driving nice cars to work. Nicer cars than is really necessary. They could buy a cheaper can and invest a lot more than a dollar. My daily driver is 30+ years old. It's probably worth about $500. Repairs, taxes, and insurance on it is cheap, too. For one thing, since the car is pretty much worthless, there's no point in spending money on comprehensive insurance. But I turn the key and it goes. Except for today, when the battery cable corroded to the point of not passing enough current. I ordered a new cable from Amazon for $10, and will install it tomorrow. It'll probably take about 10 minutes. Did I say it was cheap to repair?
ThrowawayR2 7y ago
"The poorest third of households buy half of all lotto tickets, according to a Duke University study in the 1980s, in part because lotteries are advertised most aggressively in poorer neighborhoods." https://www.theatlantic.com/business/archive/2015/05/lotteries-americas-70-billion-shame/392870/ https://www.theatlantic.com/business/archive/2015/05/lotteri... [EDIT] It's not an insignificant amount either: half of $70 billion. From the same article: "According to the North American Association of State and Provincial Lotteries, lotteries took in $70.1 billion in sales in the 2014 fiscal year. That’s more than Americans in all 50 states spent on sports tickets, books, video games, movie tickets, and recorded music sales."
- throwaway2048 7y ago
  I bet they have televisions too, the sheer audacity
  - manigandham 7y ago
    What? The point is that lack of funds for investing is clearly not the problem if they're buying so many lotto tickets.
    - throwaway2048 7y ago
      And they have televisions too, other money they spend that they could have spent on investing.
      - manigandham 7y ago
        True. Nobody said they had to give up TVs though.
    - robjan 7y ago
      What is the volume on lotto tickets vs the stock market. Are you really telling me that someone who spends $2 per week (or whatever your lotto price is) on lotto tickets could afford to create a balanced stock portfolio or even buy one stock? Buy ETFs? The buy in price for SPY is US$329. By the time you saved up enough $2/week to buy one unit of that stock it's already too expensive.
xyzzyz 7y ago
People making $180k a year lack funds to buy stocks? Yeah, that’s a no from me.
- throwawayjava 7y ago
  >> I'm thinking the bottom 90% doesn't own much stock due to lack of funds. Not because they don't know how or because transaction fees are too high. > People making $180k a year lack funds to buy stocks? Yeah, that’s a no from me. An individual person making $180K a year is in the 92nd percentile. Parent is talking about the other roughly 300 million people.
  - loeg 7y ago
    GP is talking about the 90th percentile. If you want to quibble about exactly where that line is, whatever, but it's not the point. It's very clear that the percentage of people who can afford to invest is broader than the top decile.

by jjeaff 7y ago

Just spitballing here, but I'm thinking the bottom 90% doesn't own much stock due to lack of funds. Not because they don't know how or because transaction fees are too high.

WalterBright 7y ago

You can start investing in stocks for as little as $1. Lack of funds is not the problem.

nitrogen 7y ago
If I only have $2, why would I put $1 in stocks when I could put all $2 in food?
- WalterBright 7y ago
  You can always find an excuse to not invest.
  - nitrogen 7y ago
    I'm saying that when you are on the edge of being able to feed yourself, investing in anything other than being able to eat is the wrong call. I have actually been in that position. It also seems kind of silly to play with $1 in the stock market; I'm going to make like 8 cents in a year on average with a high variance, while if I bought food I would be able to work using those calories and maybe earn $8 in the time it took to burn those calories.
    - xyzzyz 7y ago
      Ah, the bottom 90% of Americans, ever on the edge of being able to feed themselves.
    - manigandham 7y ago
      It's pretty clear that we're discussing the far greater majority that actually can feed themselves and have money left over to invest. Also people go through different stages in life, as you claimed in your comment. You might have been too poor before but I assume you can invest now right?
      - WalterBright 7y ago
        My iphone is 4 years old now. I've saved a ton of money not buying the latest every year, money I invest.
    - WalterBright 7y ago
      The freeways around here are gridlocked every day with people driving nice cars to work. Nicer cars than is really necessary. They could buy a cheaper can and invest a lot more than a dollar. My daily driver is 30+ years old. It's probably worth about $500. Repairs, taxes, and insurance on it is cheap, too. For one thing, since the car is pretty much worthless, there's no point in spending money on comprehensive insurance. But I turn the key and it goes. Except for today, when the battery cable corroded to the point of not passing enough current. I ordered a new cable from Amazon for $10, and will install it tomorrow. It'll probably take about 10 minutes. Did I say it was cheap to repair?

ThrowawayR2 7y ago

"The poorest third of households buy half of all lotto tickets, according to a Duke University study in the 1980s, in part because lotteries are advertised most aggressively in poorer neighborhoods." https://www.theatlantic.com/business/archive/2015/05/lotteries-americas-70-billion-shame/392870/ https://www.theatlantic.com/business/archive/2015/05/lotteri... [EDIT] It's not an insignificant amount either: half of $70 billion. From the same article: "According to the North American Association of State and Provincial Lotteries, lotteries took in $70.1 billion in sales in the 2014 fiscal year. That’s more than Americans in all 50 states spent on sports tickets, books, video games, movie tickets, and recorded music sales."

throwaway2048 7y ago
I bet they have televisions too, the sheer audacity
- manigandham 7y ago
  What? The point is that lack of funds for investing is clearly not the problem if they're buying so many lotto tickets.
  - throwaway2048 7y ago
    And they have televisions too, other money they spend that they could have spent on investing.
    - manigandham 7y ago
      True. Nobody said they had to give up TVs though.
  - robjan 7y ago
    What is the volume on lotto tickets vs the stock market. Are you really telling me that someone who spends $2 per week (or whatever your lotto price is) on lotto tickets could afford to create a balanced stock portfolio or even buy one stock? Buy ETFs? The buy in price for SPY is US$329. By the time you saved up enough $2/week to buy one unit of that stock it's already too expensive.

xyzzyz 7y ago

People making $180k a year lack funds to buy stocks? Yeah, that’s a no from me.

throwawayjava 7y ago
>> I'm thinking the bottom 90% doesn't own much stock due to lack of funds. Not because they don't know how or because transaction fees are too high. > People making $180k a year lack funds to buy stocks? Yeah, that’s a no from me. An individual person making $180K a year is in the 92nd percentile. Parent is talking about the other roughly 300 million people.
- loeg 7y ago
  GP is talking about the 90th percentile. If you want to quibble about exactly where that line is, whatever, but it's not the point. It's very clear that the percentage of people who can afford to invest is broader than the top decile.