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by tofukid 1831 days ago
Without new money coming in, stock returns don’t beat inflation. Average dividend return on S&P500 is only 2%. Most people invested in stocks are dependent on stock prices going up to beat inflation.

https://ycharts.com/indicators/sp_500_return_from_dividends_...

1 comments

Dividends are bad for tax drag, its very common now to re-invest that money back into the company, raising the stock price. Ultimately all stock prices rise because more money flows in, but the reasons for the flow matters. If a company wins $1B out of thin air its still up to the investors to realize this and price the stock accordingly. Which is completely different from money flowing in because a cult-of-personality ceo tweeted a meme.