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I assume the largest shareholders have the most money. I work for close to min wage; if they raised my wage, the shareholders will get less money off of the wor

I assume the largest shareholders have the most money. I work for close to min wage; if they raised my wage, the shareholders will get less money off of the work I do. What I'm trying to get at is that if you already have wealth, you can turn that wealth into more wealth. But people who do not have tens of thousands of dollars a year to "invest", they cannot become wealthy. This is why I say apps like RH or other "investment" apps or the lottery prey on poorer people. They lower the barrier of entry where we spend what little we have on the dream of becoming wealthy, when in reality, it is our wealth being taken from us.

shajznnckfke 6y ago
> But people who do not have tens of thousands of dollars a year to "invest", they cannot become wealthy. I agree with that - the average rate of return on capital is not high enough to turn a poor person into a rich person. At best it could help you retire after many years of labor. > They lower the barrier of entry where we spend what little we have on the dream of becoming wealthy, when in reality, it is our wealth being taken from us. If you make safe diversified investments in Robinhood, your money isn’t being taken away. It’s just going to accumulate slowly. Robinhood is a much better actor here than a shitty fund with 1% fee load, where a lot of workers are encouraged to save their money. If you can do much better than the average rate of return, by starting your own company, or picking the right stocks through some special knowledge, you could actually get rich, but the odds are that you fail. Robinhood does harm by encouraging people to engage in this behavior.
- EarthIsHome 6y ago
  How does a person become rich? You mentioned shareholders, so that's one example we can explore. They get richer off the work I do by selling what I make/provide for more than they pay me to make it. If they paid me more and kept the exchange value of the produce/service the same, then the shareholders wouldn't profit as much while conversely giving me more money. By the shareholders exploiting my labor less, I can be richer. If I have enough wealth, I could start a company as you suggest. I could be like the shareholders where I pay my employees as little as I can get away with and selling for as much as I can. This would help me and my shareholders turn money into more money. But again, it is only through the exploitation of others that this is possible. Another example of getting rich is owning property. If I have enough wealth, I could own not one, but two homes and charge rent to people who need a place to live. As they toil away at whatever job they're doing, I get this "passive income" that greatly increases my wealth while stunting wealth growth of my tenants. We all want to be rich, but not all of us can be rich at the same time, otherwise, none of us would be rich. It's in the definition of being rich: to have more than others. But to have more than others, you have to exploit them. And, tying this all back to your first comment describing one of the basic features of our society: using capital to generate wealth. You can imaging that this basic feature of our society makes it such that wealth clumps together. The more wealth you have, the easier it is to grow that wealth; it's like a positive feedback loop if you're into systems engineering or a massive object if you're into space. And having no money or no wealth is actively bad, and you can probably model a negative feedback loop of that, with the ultimate outcome of death (there's probably some good charts showing life expectancy vs wealth/class out there that illustrates this). This is just an observation of the society we live in. It might be obvious to you, but it's cruel to me and many others who toil paycheck to paycheck living in fear of running out of the little money we have. > If you make safe diversified investments in Robinhood, your money isn’t being taken away. Sure, Say I invest $1200 over a year. How much would it "grow"? Also, that's $120/month.. what if I need the $120 immediately and can't invest that much. I guess my question is, How much money do you need for RH to be worthwhile?
  - ghaff 6y ago
    I would probably not use Robinhood, but it's fairly common for people starting out to open an account and do a modest recurring purchase of some index fund or other "boring" fund with low management fees. It takes time but it does grow. >Say I invest $1200 over a year. How much would it "grow"? Depends on the investment and depends on the market. Figure a few percent, which isn't a lot but save $1,000/year and it starts to add up.
    - EarthIsHome 6y ago
      Investing presumes you already have money. This may not even be feasible for the majority of Americans; according to [0], 69% of Americans have less than $1,000 in savings. Let's say that I can save $1200/year for 10 years with an interest rate of 8%... After 10 years, it would have grown by about $5k. Some CEOs make that much in a day or week off of the exploitation of their workers. I would spend ten years, a whole decade!! And this assumes that it goes smoothly with no emergencies, no medical expenses, and wage growth keeps up with cost of living.. All these things that don't happen in real life. After all, everything that's required to live (the bare necessities) costs money, which eats away at my savings while making someone with already a lot of money even richer. If you take reality into account, I think it's a pipedream for people of lower socioeconomic statuses to be able to climb the economic ladder into a higher class. Again, I'm trying to illustrate how there's very little positive vertical movement for the majority of people. [0]: https://www.gobankingrates.com/saving-money/savings-advice/americans-have-less-than-1000-in-savings/ https://www.gobankingrates.com/saving-money/savings-advice/a...
      - outworlder 6y ago
        Yeah. So your investment has increased by 5k in the first 10 years. You only contributed $100 a month, which is doable for a lot of people, and go 5k for 'free'. In 20 years, it will have grown by 30k on top of your contributions. Again, assuming you never adjust your contributions. Try the same calculation, but now with $500 a month. Although 8% is optimistic, compound interest is really powerful. It is indeed difficult to get ahead if you are paycheck to paycheck. It can be impossible if you can't even pay for your basic necessities. But many people are not in that situation. They buy stuff they don't need. They buy new cars on credit - which is a depreciating asset with interest. They buy phones they also don't need - sometimes in multiple installments too. Instead, try throwing anything extra you can scrape in investments. If you are aggressive about it, you can retire much earlier than you would be able to, normally.

shajznnckfke 6y ago

> But people who do not have tens of thousands of dollars a year to "invest", they cannot become wealthy. I agree with that - the average rate of return on capital is not high enough to turn a poor person into a rich person. At best it could help you retire after many years of labor. > They lower the barrier of entry where we spend what little we have on the dream of becoming wealthy, when in reality, it is our wealth being taken from us. If you make safe diversified investments in Robinhood, your money isn’t being taken away. It’s just going to accumulate slowly. Robinhood is a much better actor here than a shitty fund with 1% fee load, where a lot of workers are encouraged to save their money. If you can do much better than the average rate of return, by starting your own company, or picking the right stocks through some special knowledge, you could actually get rich, but the odds are that you fail. Robinhood does harm by encouraging people to engage in this behavior.

EarthIsHome 6y ago
How does a person become rich? You mentioned shareholders, so that's one example we can explore. They get richer off the work I do by selling what I make/provide for more than they pay me to make it. If they paid me more and kept the exchange value of the produce/service the same, then the shareholders wouldn't profit as much while conversely giving me more money. By the shareholders exploiting my labor less, I can be richer. If I have enough wealth, I could start a company as you suggest. I could be like the shareholders where I pay my employees as little as I can get away with and selling for as much as I can. This would help me and my shareholders turn money into more money. But again, it is only through the exploitation of others that this is possible. Another example of getting rich is owning property. If I have enough wealth, I could own not one, but two homes and charge rent to people who need a place to live. As they toil away at whatever job they're doing, I get this "passive income" that greatly increases my wealth while stunting wealth growth of my tenants. We all want to be rich, but not all of us can be rich at the same time, otherwise, none of us would be rich. It's in the definition of being rich: to have more than others. But to have more than others, you have to exploit them. And, tying this all back to your first comment describing one of the basic features of our society: using capital to generate wealth. You can imaging that this basic feature of our society makes it such that wealth clumps together. The more wealth you have, the easier it is to grow that wealth; it's like a positive feedback loop if you're into systems engineering or a massive object if you're into space. And having no money or no wealth is actively bad, and you can probably model a negative feedback loop of that, with the ultimate outcome of death (there's probably some good charts showing life expectancy vs wealth/class out there that illustrates this). This is just an observation of the society we live in. It might be obvious to you, but it's cruel to me and many others who toil paycheck to paycheck living in fear of running out of the little money we have. > If you make safe diversified investments in Robinhood, your money isn’t being taken away. Sure, Say I invest $1200 over a year. How much would it "grow"? Also, that's $120/month.. what if I need the $120 immediately and can't invest that much. I guess my question is, How much money do you need for RH to be worthwhile?
- ghaff 6y ago
  I would probably not use Robinhood, but it's fairly common for people starting out to open an account and do a modest recurring purchase of some index fund or other "boring" fund with low management fees. It takes time but it does grow. >Say I invest $1200 over a year. How much would it "grow"? Depends on the investment and depends on the market. Figure a few percent, which isn't a lot but save $1,000/year and it starts to add up.
  - EarthIsHome 6y ago
    Investing presumes you already have money. This may not even be feasible for the majority of Americans; according to [0], 69% of Americans have less than $1,000 in savings. Let's say that I can save $1200/year for 10 years with an interest rate of 8%... After 10 years, it would have grown by about $5k. Some CEOs make that much in a day or week off of the exploitation of their workers. I would spend ten years, a whole decade!! And this assumes that it goes smoothly with no emergencies, no medical expenses, and wage growth keeps up with cost of living.. All these things that don't happen in real life. After all, everything that's required to live (the bare necessities) costs money, which eats away at my savings while making someone with already a lot of money even richer. If you take reality into account, I think it's a pipedream for people of lower socioeconomic statuses to be able to climb the economic ladder into a higher class. Again, I'm trying to illustrate how there's very little positive vertical movement for the majority of people. [0]: https://www.gobankingrates.com/saving-money/savings-advice/americans-have-less-than-1000-in-savings/ https://www.gobankingrates.com/saving-money/savings-advice/a...
    - outworlder 6y ago
      Yeah. So your investment has increased by 5k in the first 10 years. You only contributed $100 a month, which is doable for a lot of people, and go 5k for 'free'. In 20 years, it will have grown by 30k on top of your contributions. Again, assuming you never adjust your contributions. Try the same calculation, but now with $500 a month. Although 8% is optimistic, compound interest is really powerful. It is indeed difficult to get ahead if you are paycheck to paycheck. It can be impossible if you can't even pay for your basic necessities. But many people are not in that situation. They buy stuff they don't need. They buy new cars on credit - which is a depreciating asset with interest. They buy phones they also don't need - sometimes in multiple installments too. Instead, try throwing anything extra you can scrape in investments. If you are aggressive about it, you can retire much earlier than you would be able to, normally.