The problem isn’t necessarily with the IPOs. If an unprofitable company wants to go public with nothing to offer but empty promises, why shouldn’t they?
The real problem is how these companies have grown as large as they have with no profits, and are dominating the US economy. In a sane world, ordinary investors wouldn’t be lining up to buy shares of these companies that may never show a profit. What makes it even worse is how indexes are bending their own rules to get these companies in. Many ordinary people might not even realize how much their retirement is tied into these companies at this point.
Now, educated investors might see these as a lotto ticket. Put a small amount into each one, and maybe one or two hits big and generate outsized returns. But those folks are not gambling with their pensions. I have a bad feeling that when it all falls apart, the country as a whole will be left holding the bag, either because the stock market craters to the point that no one can retire, or the Feds step in and bail it all out
But that’s the thing, it’s not fraudulent to run a business that loses money. And these folks are committing no fraud, they are entirely honest in their filings that show they are burning through money with no hope of actual profit.
Yet, people keep buying. It’s like they care less about the underlying business, and more about catching a profit before it all falls apart.
They don’t need to be fraudulent, if they can get just as much investment by being honest.
Most of us can’t control line-item investments, but we can move that money around. I’d bet the “super duper low risk” categories don’t hold much or any AI stock at the moment. Anyone know?
The problem isn’t necessarily with the IPOs. If an unprofitable company wants to go public with nothing to offer but empty promises, why shouldn’t they?
The real problem is how these companies have grown as large as they have with no profits, and are dominating the US economy. In a sane world, ordinary investors wouldn’t be lining up to buy shares of these companies that may never show a profit. What makes it even worse is how indexes are bending their own rules to get these companies in. Many ordinary people might not even realize how much their retirement is tied into these companies at this point.
Now, educated investors might see these as a lotto ticket. Put a small amount into each one, and maybe one or two hits big and generate outsized returns. But those folks are not gambling with their pensions. I have a bad feeling that when it all falls apart, the country as a whole will be left holding the bag, either because the stock market craters to the point that no one can retire, or the Feds step in and bail it all out
Because it hurts the public? Do you not think the people should ever defend themselves?
Because its fraudulent and in the end its always the people that have less that will end up suffering the consequences?
But that’s the thing, it’s not fraudulent to run a business that loses money. And these folks are committing no fraud, they are entirely honest in their filings that show they are burning through money with no hope of actual profit.
Yet, people keep buying. It’s like they care less about the underlying business, and more about catching a profit before it all falls apart.
They don’t need to be fraudulent, if they can get just as much investment by being honest.
Acquiring profit is what capitalism is all about.
The “people” buying are retirement accounts that actual people can’t control
Most of us can’t control line-item investments, but we can move that money around. I’d bet the “super duper low risk” categories don’t hold much or any AI stock at the moment. Anyone know?
They’re looking for a government bailout
why should a government care about those with nothing to offer it?
What are you offering me to care for your comment?