[gareim]

You didn't refute his point at all.. He said > You are correct about the empirical facts (there exist some companies don't currently pay dividends), but theory is needed to understand that if those company's never paid dividends, they would be worthless.

Which means that EVENTUALLY, these companies will either pay dividends or their stocks are worthless. You pointed out companies that currently do not pay out dividends, but it in no way refutes his statement.

And I have to say he's right. Why? Because if companies never pay out dividends, you're buying stock where the sole method of making profit is by selling it for a higher price. Yes, it's how the market works, but if stocks inherently do nothing (no dividends/dividend-likes, no voting), then they are inherently worthless.

Simply because a market exists where people buy low and sell high does not mean that stocks can exist without inherent value. It may be true for now, but the person you were responding to said (keyword here) eventually. Otherwise, rocks have just as much value as stock.

EDIT: Two things. One is that I just remembered that Apple recently started paying out dividends in the last year or two. Here's an example of a company that did not pay dividends for a long time and EVENTUALLY started to.

The second thing is that I usually hate downvoting people, but you were incredibly aggressive rather than calmly attempting to understand (or be understood by the person) you were conversing with.

[lutusp]

> Which means that EVENTUALLY, these companies will either pay dividends or their stocks are worthless.

Yes, And that is false. IT IS FALSE. There are companies that never pay dividends, but because of continuous growth, are regarded as attractive investments (Berkshire Hathaway is just one of many examples). To avoid any possible confusion, I posted a list of such companies. And I have just added another list below.

A company must either grow, or pay dividends. Investors don't much care which it is, because both grow the investor's capital.

> The second thing is that I usually hate downvoting people, but you were incredibly aggressive rather than calmly attempting to understand (or be understood by the person) you were conversing with.

Yes, which means you downvoted based on the fact that you disagreed with the views I expressed, not based on whether I contributed to the conversation, a violation of HN's voting guidelines.

There is something very simple you need to understand -- the OP was flat wrong, and I was flat right. I posted my views, then I posted my proof. The OP posted his annoyance at my way of expressing the truth, which is, among other things, off-topic.

And now you have done the same.

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http://seekingalpha.com/article/1939371-no-dividend-stocks-c...

Quote: "Having delivered an average of one-third of stock returns since, (it was more than 50% in the '70s and 14% for the '90s) the case for dividends is clear. But there is no free lunch here. In periods of economic and market growth, dividend payers typically trail the performance of non-payers. Like now. According to S&P Dow Jones Indices, for the 12 months through November dividend payers in the S&P 500 delivered a 39.6% total return. No need to apologize for that. But the non-dividend payers clocked in with a 46.4% total return.

Ranking the entire S&P 500 by 12-month price gains, seven of the top 10 are dividend holdouts, led by Netflix (NFLX) which has quadrupled in price this year. The others: Micron Technology (MU), E*TRADE (ETFC). Genworth Financial (GNW), Yahoo! Inc. (YHOO), Celgene (CELG) and Boston Scientific (BSX), all of which have at least doubled in price over the past 12 months."

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So tell me -- which part of this trivial economic fact are you confused about?

[gareim]

Haha, let's you and I and everybody else start trading rocks. Whether or not the rocks have value don't matter, as long as the price of rocks continue to go up. Will you keep buying the rocks because of this upward growth?

> Yes, which means you downvoted based on the fact that you disagreed with the views I expressed, not based on whether I contributed to the conversation, a violation of HN's voting guidelines.

That.. is not at all what I said, which baffles me as you quoted me yourself. I said the way you presented it, not what you presented. "The OP was flat wrong, and I was flat right". Again, super aggressive. You're not even attempting to understand others anymore, as evidenced by what we said about downvoting.

Plus, if you actually did read the HN guidelines, you would see something like > When disagreeing, please reply to the argument instead of calling names. E.g. "That is an idiotic thing to say; 1 + 1 is 2, not 3" can be shortened to "1 + 1 is 2, not 3."

Some of your comments, not just this one, clearly violate that.

If you want to have a serious discussion regarding the value of stocks in society, then message me. If not, I'll just stop replying because it's not worth my time otherwise.

EDIT: I forgot to say that you're looking at transactions at the micro level. You need to look at the grand scheme of things. Why buy stocks at all? What if we took these companies histories to a decade from now? Two decades? Half a century? To infinity? Look at the theory behind what drives the market, not simply what today's market price is. You buying stocks to sell for higher doesn't refute the theory behind the entire system.

[sysop073]

Are you kidding? If I can buy the rocks at $4 per rock and I'm pretty sure I'll be able to sell them to somebody later at $6 per rock, absolutely I'll keep buying the rocks.