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> You're paying off a chain of investors, all the way back to the investor who participated in Tesla's IPO, who did directly fund Tesla's factories. Claiming ot

> You're paying off a chain of investors, all the way back to the investor who participated in Tesla's IPO, who did directly fund Tesla's factories. Claiming otherwise makes as much sense as "buying an apple from the grocery store doesn't feed back into apple farmers, because you're only paying the grocery store". The more you distance and dilute from the original share, the less relation there is to the original investor. Eventually, there is simply no relation to the two. Similar to how buying a used copy of Frankenstein today has no benefit to Mary Shelley or her estate. I should also point out that apples and other consumables have finite lifespans. The apple you buy from the grocery store has a near direct line to the farmer that sold it. Purchases of apples drive demand because they are almost immediately consumed. Stock is more closely related to something like iron. Sure, someone had to refine it at one point and there is demand for new iron on occasion. However, generally speaking the recycling and reuse of iron has little direct impact or benefit to the original miner. Unlike iron or apples, stock never goes through a value add transformation. A share is a share. It provides no extra work or good. > Source? https://www.npr.org/2024/09/09/nx-s1-5103935/grocery-prices-inflation-corporate-greedflation https://www.npr.org/2024/09/09/nx-s1-5103935/grocery-prices-...

gruez 2y ago
>The more you distance and dilute from the original share, the less relation there is to the original investor. Eventually, there is simply no relation to the two. Similar to how buying a used copy of Frankenstein today has no benefit to Mary Shelley or her estate. No, because capital markets are far more liquid than the market for copies of Frankenstein. Every dollar that gets "invested" goes into the global pool of capital stock, some of which is used for new investments like factories or whatever. Spending a dollar on existing shares makes them ever more expensive, and therefore a poorer investment than new investments. That causes more money to be funneled into new investments. There isn't a surfeit of piled into existing shares, because the existence of such a surfeit would imply there's money for someone (institutional investors, hedge funds) to sell their existing shares to fund new investments. >https://www.npr.org/2024/09/09/nx-s1-5103935/grocery-prices- https://www.npr.org/2024/09/09/nx-s1-5103935/grocery-prices-... The original claim was "Collusion and speculation is a big factor in a lot of the inflation.". Your article says: >Gross profit margins of big-name stores and brands stayed mostly steady and >"Even though profit margins for grocery stores have gone up," he wrote in a July report, "the increase appears to be only a small contributor to the rise in food prices relative to the increase in their operating costs." But grocery stores' margins are single digits, so at best this explains a few percent (note, not the same as percentage points) of inflation. Hardly "a big factor".

gruez 2y ago

>The more you distance and dilute from the original share, the less relation there is to the original investor. Eventually, there is simply no relation to the two. Similar to how buying a used copy of Frankenstein today has no benefit to Mary Shelley or her estate. No, because capital markets are far more liquid than the market for copies of Frankenstein. Every dollar that gets "invested" goes into the global pool of capital stock, some of which is used for new investments like factories or whatever. Spending a dollar on existing shares makes them ever more expensive, and therefore a poorer investment than new investments. That causes more money to be funneled into new investments. There isn't a surfeit of piled into existing shares, because the existence of such a surfeit would imply there's money for someone (institutional investors, hedge funds) to sell their existing shares to fund new investments. >https://www.npr.org/2024/09/09/nx-s1-5103935/grocery-prices- https://www.npr.org/2024/09/09/nx-s1-5103935/grocery-prices-... The original claim was "Collusion and speculation is a big factor in a lot of the inflation.". Your article says: >Gross profit margins of big-name stores and brands stayed mostly steady and >"Even though profit margins for grocery stores have gone up," he wrote in a July report, "the increase appears to be only a small contributor to the rise in food prices relative to the increase in their operating costs." But grocery stores' margins are single digits, so at best this explains a few percent (note, not the same as percentage points) of inflation. Hardly "a big factor".