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I expected an even more unequal distribution. Owning stocks is risky, and stock portfolios are mostly bought with money people don't need to live on a day to da
by GuB-42 5y ago
I expected an even more unequal distribution.
Owning stocks is risky, and stock portfolios are mostly bought with money people don't need to live on a day to day basis.
The poor simply can't afford stocks, and I expect the middle class to make different kinds of investment. Like property (buy a house), and low risk saving accounts that may be backed by stocks but the owner of the account is not the owner of the stocks. There may be a small part of gamblers who play the stock market like they are in Vegas, but I expect most stocks to be owned by very rich individuals or institutions, who can mitigate the risks by having lots of stocks, and also have some amount of control on the companies they invested into, rather than a millionth of a vote for small investors. Among the institutions are the ones that provide financial services to the middle class.
- karma_daemon 5y agoI'm not sure you need to be very rich, or an institution to diversify. In fact, it's never been easier to own hundreds, or thousands, of stocks as an individual. All you need to do is buy etfs.
- lexapro 5y agoThe middle class owns stocks through pension accounts.
- SavantIdiot 5y agoWhere does one get a job with pension today? I've heard of them, but thought they vanished when the boomers left the workforce.
- germinalphrase 5y agoTraditionally unionized employers may still offer pensions (teachers, law enforcement, steelworkers, etc).
- RNCTX 5y agoI invite you to google "Gary, Indiana." And I assure you the casino doesn't pay pensions.
- jandrese 5y agoThat would also include 401k style retirement accounts which are extremely common.
- SavantIdiot 5y agoA pension is not a 401k.
- jandrese 5y agoNo, but 401ks are also invested in stocks.
- ohazi 5y ago> low risk saving accounts No, the interest rates for retail savings accounts are zero (or near as makes no difference), and have been for at least two decades. Basically everybody knows that they are completely useless by now, and that even "regular" people need to move to bonds or stocks in order to see any kind of return.
- SavantIdiot 5y agoI switched to interest free accounts simply because I got tired of having to add a few dollars (or less) of interest to reconcile my Quicken accounts at the end of every month. Such a joke. I remember when an ING money market was paying like some crazy 4 or 5% in the late 90's.
- ceejayoz 5y agoThose 4-5% interest rates on savings came with vastly higher rates in other areas, though. Mortgage rates of 10% versus today's 3% or so. They just follow the Fed funds rate up and down.
- SavantIdiot 5y agoOh yeah, that's a really important point. My first mortgage was 8.5% ... on a $130k 2400sqft house in a metropolitan area that now goes for >800k on zillow.
- jedberg 5y agoING gave 5%, but mortgage rates were also 8-9% and car loans even worse. I remember my first car, which I got in December '99, had a 13.1% interest rate, and that was already at the lower end. So my point is it's all relative.