4 ms·

Feel free to look at dividend yields, but I can pretty much guarantee that it has not halfed in the period the stock market doubled. Most likely it stayed relat

by Epa095 1y ago

Feel free to look at dividend yields, but I can pretty much guarantee that it has not halfed in the period the stock market doubled. Most likely it stayed relatively flat, somewhere between 1.5% and 2%. So if you had 100 million you would get 1.7 million as dividend 5-7 years ago, now it's roughly doubled, without selling any of your stocks. Not that it really matters. Given how much faster the stock market grows compared to salaries you can sell a few percentages of your wealth every year, and still get richerer by doing nothing besides owning.

gruez 1y ago
>Feel free to look at dividend yields, but I can pretty much guarantee that it has not halfed in the period the stock market doubled. Most likely it stayed relatively flat, somewhere between 1.5% and 2%. Eyeballing this chart it looks like it dropped around a third since the pandemic. https://ritholtz.com/wp-content/uploads/2021/09/spx-div-yld.png https://ritholtz.com/wp-content/uploads/2021/09/spx-div-yld.... https://ycharts.com/indicators/sp_500_dividend_yield https://ycharts.com/indicators/sp_500_dividend_yield
- grafmax 1y ago
  If yields stay the same actual dividends still grow in a rising market. Of course dividends aren’t a good representation of increased wealth. Stock price + dividends is. Companies generate profit which gets added to the balance sheet or paid out as dividends. It’s basically two ways of accounting for the same income (with some minor differences like tax implications).
- Epa095 1y ago
  (First, I apologise that this message must be hasty, I must do life stuff). I really feel like your first graph proves my point? OK, at times it goes up, at times it goes down. But since 2002 the dividend is the same, but the S&P 500 is 7x. So the lazy capitalist puting in 10 million there in 2002 got 132k in yearly 'income' then, now he gets 925k yearly. You wanna figure out how much average salary increased the same period? I am willing to bet it's closer to 2 than 7. And that shows who gets the fruit of our increased productivity. Owners.
  - ziofill 1y ago
    I fully agree. Additionally, stock price is driven also by expectations of further growth, which in order to keep happening, something's gotta give so it must chip away at quality of the final product too (cheaper materials, cheaper manufacturing, etc) with a consequent enshittification. My parents, who live in Italy, could afford a stone house from the 1800s in their thirties. I live in Canada and everything's made of wood and snot and and costs a fortune.
    - WalterBright 1y ago
      Just for fun, watch a movie from the 30s, 40s, 50s, etc., and take a look at the interiors of houses. We've got a lot better today, and a lot more of it. Even watch an episode of Dynasty (about rich people). Look at the crappy TV in the corner. I remember taking my last CRT TV to the recycler. I was sure glad to be rid of it.
      - OnlineGladiator 1y ago
        You realize you're an enormously privileged, wealthy individual telling other people that don't have your wealth and privilege how they should feel the same as you? You don't even say "in my experience" you just condescend to others that they should recognize how great the world is for the 0.1%, completely unaware that it isn't great for people that can't afford food and housing. Nobody gives a shit about their TV when they're hungry on the street.
        WalterBright 1y ago
        I was born into a lower middle class family with several siblings. My dad skirted bankruptcy. My first car literally came from a junkyard in pieces, bought with money I earned from my paper route. Hardly 0.1%. (I didn't know how bad things were for him until I went through his papers after he died.) I began investing with my first real job, with another crappy car I repaired with junkyard parts. A good friend of mine grew up in a family that qualified for welfare but wouldn't accept it. He didn't get past high school. He managed to make himself $10m before his tragic death. Yes, the US is the land of opportunity. Other countries can emulate it if they want to. A couple years ago, I booked an Uber ride. The driver was a refugee from Afghanistan. He arrived in the US with nothing but his skin. Within a few months he had a thriving business, driving the Uber in whatever extra time he had left. It was fun talking to him - he was hella ambitious!
- cma 1y ago
  Most companies moved to stock buybacks instead of dividends for tax reasons.
WalterBright 1y ago
Keep in mind that anyone can buy stock. And stocks in the US historically outperform passive real estate investing.
- cool_dude85 1y ago
  Careful with "can". It is possible for the homeless guy on the corner to buy stock in the sense that he is not prohibited from doing so. But on the other hand, the actual fact is that he can not purchase stock.
  - grafmax 1y ago
    Right, ability to buy stock is predicated on having the money to do it, after paying for basic necessities. People who work for a living have less money than those who don’t. So when stock prices rise, even workers who can save see less absolute benefit than owners.
    - WalterBright 1y ago
      You can buy fractional shares from robinhood for $10. The internet has brought a great democratization of access to the stock market. If you don't have an investment program, the best time to start is right now.
      - grafmax 1y ago
        The point is that workers have far less money to save. Therefore when stocks go up due to increased productivity, even workers who have enough money to save still don’t benefit, in absolute terms, as much as owners.
        WalterBright 1y ago
        Becoming an owner by founding a company is the way to reach the top tier. Jobs, Gates, Bezos, Musk, etc. BTW, I know a person who worked as a fruit picker as a young man, he's now a multimillionaire. And a woman who grew up in a mobile home who is now worth 9 figures. America is a great country. P.S. my first business was selling greeting cards door to door.
prasadjoglekar 1y ago
This is the definition of an asset bubble in my books. In 2007 +/-, this is exactly what happened with housing prices. People would buy an asset and watch it appreciate doing nothing. Why go to your forklift operator job at Home Depot if you can make $50K per year in asset appreciation by sitting and doing nothing?

by Epa095 1y ago

gruez 1y ago

>Feel free to look at dividend yields, but I can pretty much guarantee that it has not halfed in the period the stock market doubled. Most likely it stayed relatively flat, somewhere between 1.5% and 2%. Eyeballing this chart it looks like it dropped around a third since the pandemic. https://ritholtz.com/wp-content/uploads/2021/09/spx-div-yld.png https://ritholtz.com/wp-content/uploads/2021/09/spx-div-yld.... https://ycharts.com/indicators/sp_500_dividend_yield https://ycharts.com/indicators/sp_500_dividend_yield

grafmax 1y ago
If yields stay the same actual dividends still grow in a rising market. Of course dividends aren’t a good representation of increased wealth. Stock price + dividends is. Companies generate profit which gets added to the balance sheet or paid out as dividends. It’s basically two ways of accounting for the same income (with some minor differences like tax implications).
Epa095 1y ago
(First, I apologise that this message must be hasty, I must do life stuff). I really feel like your first graph proves my point? OK, at times it goes up, at times it goes down. But since 2002 the dividend is the same, but the S&P 500 is 7x. So the lazy capitalist puting in 10 million there in 2002 got 132k in yearly 'income' then, now he gets 925k yearly. You wanna figure out how much average salary increased the same period? I am willing to bet it's closer to 2 than 7. And that shows who gets the fruit of our increased productivity. Owners.
- ziofill 1y ago
  I fully agree. Additionally, stock price is driven also by expectations of further growth, which in order to keep happening, something's gotta give so it must chip away at quality of the final product too (cheaper materials, cheaper manufacturing, etc) with a consequent enshittification. My parents, who live in Italy, could afford a stone house from the 1800s in their thirties. I live in Canada and everything's made of wood and snot and and costs a fortune.
  - WalterBright 1y ago
    Just for fun, watch a movie from the 30s, 40s, 50s, etc., and take a look at the interiors of houses. We've got a lot better today, and a lot more of it. Even watch an episode of Dynasty (about rich people). Look at the crappy TV in the corner. I remember taking my last CRT TV to the recycler. I was sure glad to be rid of it.
    - OnlineGladiator 1y ago
      You realize you're an enormously privileged, wealthy individual telling other people that don't have your wealth and privilege how they should feel the same as you? You don't even say "in my experience" you just condescend to others that they should recognize how great the world is for the 0.1%, completely unaware that it isn't great for people that can't afford food and housing. Nobody gives a shit about their TV when they're hungry on the street.
      - WalterBright 1y ago
        I was born into a lower middle class family with several siblings. My dad skirted bankruptcy. My first car literally came from a junkyard in pieces, bought with money I earned from my paper route. Hardly 0.1%. (I didn't know how bad things were for him until I went through his papers after he died.) I began investing with my first real job, with another crappy car I repaired with junkyard parts. A good friend of mine grew up in a family that qualified for welfare but wouldn't accept it. He didn't get past high school. He managed to make himself $10m before his tragic death. Yes, the US is the land of opportunity. Other countries can emulate it if they want to. A couple years ago, I booked an Uber ride. The driver was a refugee from Afghanistan. He arrived in the US with nothing but his skin. Within a few months he had a thriving business, driving the Uber in whatever extra time he had left. It was fun talking to him - he was hella ambitious!
cma 1y ago
Most companies moved to stock buybacks instead of dividends for tax reasons.

WalterBright 1y ago

Keep in mind that anyone can buy stock. And stocks in the US historically outperform passive real estate investing.

cool_dude85 1y ago
Careful with "can". It is possible for the homeless guy on the corner to buy stock in the sense that he is not prohibited from doing so. But on the other hand, the actual fact is that he can not purchase stock.
- grafmax 1y ago
  Right, ability to buy stock is predicated on having the money to do it, after paying for basic necessities. People who work for a living have less money than those who don’t. So when stock prices rise, even workers who can save see less absolute benefit than owners.
  - WalterBright 1y ago
    You can buy fractional shares from robinhood for $10. The internet has brought a great democratization of access to the stock market. If you don't have an investment program, the best time to start is right now.
    - grafmax 1y ago
      The point is that workers have far less money to save. Therefore when stocks go up due to increased productivity, even workers who have enough money to save still don’t benefit, in absolute terms, as much as owners.
      - WalterBright 1y ago
        Becoming an owner by founding a company is the way to reach the top tier. Jobs, Gates, Bezos, Musk, etc. BTW, I know a person who worked as a fruit picker as a young man, he's now a multimillionaire. And a woman who grew up in a mobile home who is now worth 9 figures. America is a great country. P.S. my first business was selling greeting cards door to door.

prasadjoglekar 1y ago

This is the definition of an asset bubble in my books. In 2007 +/-, this is exactly what happened with housing prices. People would buy an asset and watch it appreciate doing nothing. Why go to your forklift operator job at Home Depot if you can make $50K per year in asset appreciation by sitting and doing nothing?