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"Capital" is just faceless organizations wanting to park their wealth somewhere to get a return. 40% of US corporate equity is owned by the foreign sector 40%
by rsj_hn 5y ago
"Capital" is just faceless organizations wanting to park their wealth somewhere to get a return.
40% of US corporate equity is owned by the foreign sector
40% is in tax-advantaged retirement accounts and pension funds as well as tax-advantaged non-profits.
20% is in various taxable accounts of US citizens and US based corporations.
source: https://theirrelevantinvestor.com/2020/10/25/who-owns-the-stock-market/ https://theirrelevantinvestor.com/2020/10/25/who-owns-the-st...
It used to be that 70% of the stock market was owned by retirement funds, before we began accepting massive capital inflows from the foreign sector.
I guarantee you very few people who buy these portfolios even know the names of the businesses they own. There is nothing about "caring" involved in this equation. Nor is there anything about "loyalty". It's not a good idea to anthropomorphize capital markets, not if you are trying to understand them. People at a horse track placing bets on which horse is the fastest are not loyal to the horses, nor do they expect the horses to be loyal to them. If a horse doesn't run as fast, they just change the odds on that horse. Really, I think a poor understanding of both capital markets and banking is the main reason a lot of well-intentioned reforms end up being ineffective or backfiring. For example, you'd get a lot farther at promoting higher wages if you ban capital inflows than with unionization efforts.
- Ericson2314 5y agoI'm not trying to humanize Capital. There are plenty stock market analyses that matter-of-fact-ly complain about wages and demand more buybacks/dividends. And the profit have also been increasing more than wages or reinvestments. To the extent the "new inequality" is these institutional investors, well it's "first time as tragedy, second time as farce" all over again. > https://theirrelevantinvestor.com/2020/10/25/who-owns-the-stock-market/ https://theirrelevantinvestor.com/2020/10/25/who-owns-the-st... That's a neat graph. I would also like to see some measure of foreign assets with US owners to put that in perspective. "Foreigners" I also want to break down; that label makes it sound like all the rich individuals families went abroad (!), but I assume the foreign investors are institutional too?