>I hate to turn this into finance 101, but there seems to be some confusion here. There does indeed seem to be some confusion. The problem is you're the one w

>I hate to turn this into finance 101, but there seems to be some confusion here. There does indeed seem to be some confusion. The problem is you're the one who is confused. >Owner a has 50 shares. Owner B has 50 shares. Total is 100 shares. They decide they want to give Jim Bob some shares for his birthday. They issue 50 more shares to do so. Owners A and B have been diluted and the value of their shares has decreased. That is dilution. The part where they issued new shares is dilution. But the part where they give them away, guaranteeing a drop in the price of the stock, is not. In the real world corporations don't give stock away. They will sell those 50 shares on the open market and use the money to, say, buy capital equipment. In most cases the price of the shares will remain unchanged, because the value of the company's assets have increased by a corresponding amount. The price is absolutely not guaranteed to go down. Issuing new shares has no more effect on the share price than raising capital through other means like borrowing from the bank or issuing bonds.