[wonderwonder]

stocks are a pyramid scheme as well, just an accepted one. To profit in stocks, new investor funds are required same as crypto. Truly the only non pyramid schemes are income producing assets such as a business or real estate.

[eloff]

A stock (specifically the company behind it) is also an income producing asset. That income will eventually be returned as dividends or through stock buybacks.

I know there are stocks that don't do either of those things (although rare) but the idea is they will one day in the future. You're still paying now for a piece of future profits. That's very different from a pyramid scheme.

[vikramkr]

Stocks are income producing assets, specifically a portion of a business. Dividends and stock buybacks are a thing.

[moultano]

Look up what a dividend is.

[wonderwonder]

Amazon is one of the largest companies on earth. How much has it paid in dividends?

Netflix? Alibaba?

[kasey_junk]

Amazon is doing a big stick buyback this year. Currently that’s a more tax efficient way to accomplish income production for most of its shareholders. Alibaba is doing the same.

Netflix has done buybacks in the past but their financials aren’t great right now.

[moultano]

Once Amazon decides that the prospects for continuing to invest in growing their business are lower, they will start paying dividends. In the meantime Microsoft and Apple already do.

[wonderwonder]

So the hope that eventually the powers that be at Amazon will feel magnanimous at an undetermined date in the future is what makes it not a pyramid scheme at the moment?

[moultano]

What makes it not a pyramid scheme is that by owning the stock you own part of Amazon, and Amazon makes money by providing a service to users. The inflow of money comes from the users of its product, not future suckers.

[wonderwonder]

If Amazon makes a million or trillion dollars, none of that money goes to shareholders. The only thing that affects the value of the amazon stock you hold is the willingness of someone else to buy that stock from you at a price higher or lower than what you purchased it for. Your return on investment on Amazon stock is 100% reliant on the purchases of future suckers. If tomorrow every one just decided not to buy Amazon shares anymore the value of that stock is 0 as it relies on future suckers for exit liquidity.

[InitialLastName]

> powers that be at Amazon

You mean "a large enough contingent of shareholders", right?