The Case For $3,000 Gold 1 1

[Henri Charriere]

On 12/25/2023 at 10:33 PM, GoldFinger1969 said:

I plugged that stock and other dividend-paying bank stocks a few months ago on some other forums.  Sometimes a high dividend can signify trouble but in TFC's case the stock price got cut in half and a 4% yield became 8%. 

I'd love to have a Financial Markets or Stock Market Thread where I can post thoughts and actual sell-side research.  But we can't attach PDFs here even though I've requested it over the years.

Maybe if some of you also bang the doors. 

The last time I banged on the door and boldly set up a free-standing "Off-Topic" topic, the gentleman from Texas, as we all know, objected strenuously, I was kicked out, sent to bed without supper, and had to have my User Name changed. The repercussions continue to this day. 🤔 

[VKurtB]

On 12/25/2023 at 9:33 PM, GoldFinger1969 said:

I plugged that stock and other dividend-paying bank stocks a few months ago on some other forums.  Sometimes a high dividend can signify trouble but in TFC's case the stock price got cut in half and a 4% yield became 8%. 

I'd love to have a Financial Markets or Stock Market Thread where I can post thoughts and actual sell-side research.  But we can't attach PDFs here even though I've requested it over the years.

Maybe if some of you also bang the doors. 

After Tuesday’s trading on the exchanges, TFC is no longer my top performer of 2023. Eastman Kodak has regained that honor.

[VKurtB]

On 12/26/2023 at 3:33 PM, VKurtB said:

After Tuesday’s trading on the exchanges, TFC is no longer my top performer of 2023. Eastman Kodak has regained that honor.

I also have one fund that has gained every day that I’ve owned it. I bought 100 shares last week. Swiss Helvetia CF Fund. Note: In this account, I am a committed “bottom feeder”. A flounder, if you will. 

[Henri Charriere]

On 12/26/2023 at 4:45 PM, VKurtB said:

I also have one fund that has gained every day that I’ve owned it. I bought 100 shares last week. Swiss Helvetia CF Fund. Note: In this account, I am a committed “bottom feeder”. A flounder, if you will. 

Clearly, you expect to live 'til time indefinite. A most admirable trait.

[VKurtB]

On 12/26/2023 at 3:49 PM, Henri Charriere said:

Clearly, you expect to live 'til time indefinite. A most admirable trait.

When I demise, whether tomorrow or in 25 years, I have heirs. 

[Henri Charriere]

On 12/26/2023 at 4:50 PM, VKurtB said:

When I demise, whether tomorrow or in 25 years, I have heirs. 

I don't have heirs, but I have an unexplained proclivity for putting on airs.  

[VKurtB]

On 12/26/2023 at 3:54 PM, Henri Charriere said:

I don't have heirs, but I have an unexplained proclivity for putting on airs.  

Most of my assets are professionally managed, but I have a “play around” account in which I decide all the trades. For most of the summer and half of fall, things were dicey. At one point, Truist was my biggest loser. The year-end rally has treated me well. My one losing stock is being tax loss harvested.

[GoldFinger1969]

On 12/26/2023 at 4:45 PM, VKurtB said:

I also have one fund that has gained every day that I’ve owned it. I bought 100 shares last week. Swiss Helvetia CF Fund. 

I used to call on them when I was on the sell-side.  Cheap SOBs...took our research, and never paid us.  Or me, at least. 

[zadok]

On 12/26/2023 at 4:54 PM, Henri Charriere said:

I don't have heirs, but I have an unexplained proclivity for putting on airs.  

...thats called flatulence....

[USAuPzlBxBob]

All of my Investments are in IRAs, so I haven't tax harvested in over 20 years.

In my portfolio, for years, I would see INTC in red… in fact, just 13 months ago it was negative by six grand.  Always up a little, and then down a little… or a little more.

To add insult to injury, beside its ledger line on my Schwab dashboard, their Rating for it displays an F grade?  (my only equity with such dubious distinction)

However, in just this last month it finally turned green, and now sports a grand Gain.

Today is the day I will be withdrawing my final IRA distribution for the year, calculated to leave me just $1000 short of the 2025 IRMAA threshold.

"Gather those rosebuds."  Larry Wachtel

[Henri Charriere]

On 12/27/2023 at 10:05 AM, USAuPzlBxBob said:

All of my Investments are in IRAs, so I haven't tax harvested in over 20 years.

In my portfolio, for years, I would see INTC in red… in fact, just 13 months ago it was negative by six grand.  Always up a little, and then down a little… or a little more.

To add insult to injury, beside its ledger line on my Schwab dashboard, their Rating for it displays an F grade?  (my only equity with such dubious distinction)

However, in just this last month it finally turned green, and now sports a grand Gain.

Today is the day I will be withdrawing my final IRA distribution for the year, calculated to leave me just $1000 short of the 2025 IRMAA threshold.

"Gather those rosebuds."  Larry Wachtel

This past month, I paid my rent with a USPS m.o. that was over six years old -- which cleared because they do not expire.  Would it be safe to say I came out ahead considering the devaluation of the instrument over time? (Rhetorical question.)

[USAuPzlBxBob]

Looks like today, last day of the year for trading, is everyone's tax loss harvesting day.

Then, January of every new year everyone has cold feet — literally and figuratively.

Most every January there comes a point where I wish I had sold off to some extent the month before.

I never do, though, and I just ride things out, enjoying the Div & Int streams until things come back.

However, I will admit…  2024 does pique a certain amount of angst.  More than usual.

[GoldFinger1969]

On 12/29/2023 at 1:49 PM, USAuPzlBxBob said:

Looks like today, last day of the year for trading, is everyone's tax loss harvesting day.  Then, January of every new year everyone has cold feet — literally and figuratively. Most every January there comes a point where I wish I had sold off to some extent the month before. I never do, though, and I just ride things out, enjoying the Div & Int streams until things come back. However, I will admit…  2024 does pique a certain amount of angst.  More than usual.

Only folks with losses this year are bond holders and/or folks who owned many of the R2000 and S&P 493 (ex-Magnificent 7  ).

But even those groups got a nice tail wind the last 2 months as yields fell sharply and stocks other than the Magnificent Seven lifted off.

[World Colonial]

On 12/23/2023 at 11:38 AM, VKurtB said:

Do my dividend yields mean nothing? At my age, I do favor dividend paying stocks in the account I manage personally. With a week to go, it LOOKS LIKE my best performing stock will be Truist Bank. Great dividend. 

I'm not criticizing you.  That was not my intent.

The dividend absolutely means something (a lot) but in and of itself doesn't change the definition of speculation and investment.  Before the current mania, it represented the majority of the return for the US stock market.  That's what should be expected in any "normal" market environment.

A higher dividend means it's relatively less speculative and by this metric, the US stock market is close to the most speculative ever.  The dividend yield on the DJIA (2%) and S&P 500 (1.5%) is a razor's edge above the all-time early 2000 low.

The ability of a company to pay dividends is a function of the actual fundamentals.  Corporate management's decision to establish the dividend payout rate is substantially psychological (from numerous factors) and the price of the stock essentially entirely so because the company and the stock certificate aren't equivalent.

[VKurtB]

On 12/31/2023 at 4:59 PM, World Colonial said:

I'm not criticizing you.  That was not my intent.

The dividend absolutely means something (a lot) but in and of itself doesn't change the definition of speculation and investment.  Before the current mania, it represented the majority of the return for the US stock market.  That's what should be expected in any "normal" market environment.

A higher dividend means it's relatively less speculative and by this metric, the US stock market is close to the most speculative ever.  The dividend yield on the DJIA (2%) and S&P 500 (1.5%) is a razor's edge above the all-time early 2000 low.

The ability of a company to pay dividends is a function of the actual fundamentals.  Corporate management's decision to establish the dividend payout rate is substantially psychological (from numerous factors) and the price of the stock essentially entirely so because the company and the stock certificate aren't equivalent.

But as written by someone other than me upthread, my Truist stock pays an 8% dividend, rounded to the nearest whole number. I barely consider 1.5-2% worthy of a mention. 

[World Colonial]

On 11/5/2023 at 11:04 PM, VKurtB said:

@World Colonial's view STARTS WITH an answer which he has decided is true, and he backfills everything else to comport with that view. That's not analysis. It's a broken clock being right twice a day. Someday a major correction will happen. Of course it will. It's a better than 50/50 bet I'll be dead by then. I can't bother with that much fear. My finances fear only one thing - the same guy in the White House 2 years from now. I NEED a government committed to economic GROWTH, not the economics of make believe scarcity.

"90% of Electric Vehicles are still on the road. The other 10% made it back home."

Just saw this post.  My claims don't have anything to do with what you wrote here. 

The prior post exchanges were about (relative) valuation, not market direction.  I haven't ever made a timing claim because there is no predetermined limit to an asset mania (the one we have now) and the reason there isn't is because prices and valuation have nothing to do with "fundamentals" which is what you and practically everyone else believes.

If anyone wants to buy the most historically overpriced US market in history (currently within a few percent), then go ahead and do it.  But that’s what anyone is actually buying, not what Wall Stret consensus or anyone here claims.

There is no predetermine price limit with financial instruments because prices have nothing to do with "fundamentals".  This is why “crypto” (which is actually nothing) has value, tens of trillions in sub-basement garbage quality debt instruments are priced at such low yields, and so many US stocks have sold for such ridiculous prices for so long.  

As for your comment on "growth", you and I have discussed this several times. There is a difference between what you claim I believe (a "make believe scarcity") and what you have told me in the past.  A supposed "new normal" and "something for nothing" where you have implied prosperity can be permanently increased by deficit spending and "printing".  If this is what you actually meant, it's a belief in modern alchemy.

Edited January 1 by World Colonial

[Zebo]

It all works, until it don’t. And the don’t could happen anytime. Now or ten years from now, but it will happen. 

[GoldFinger1969]

On 12/27/2023 at 10:05 AM, USAuPzlBxBob said:

"Gather those rosebuds."  Larry Wachtel

Boy, that's a name I haven't heard in years.  Used to hear him ALL THE TIME when my dad listened to WINS-1010 radio...."You give us 22 minutes....we'll give you the world."

I listened for 22 minutes, but they never gave me the world, alot of money, or even a single MCMVII High Relief coin.  Should have sued them for fraud and misrepresentation. 

I believe he was on CNBC and the old FNN, too.  Had that rosebud phrase inscribed on his tombstone if I recall.

Miss the guys I grew up with in the 1980's and 1990's. 

Edited January 2 by GoldFinger1969

[GoldFinger1969]

On 1/1/2024 at 10:01 AM, World Colonial said:

If anyone wants to buy the most historically overpriced US market in history (currently within a few percent), then go ahead and do it.  But that’s what anyone is actually buying, not what Wall Stret consensus or anyone here claims.

It's not anywhere NEAR the most historically overpriced market in history.  Not by a longshot. 

And the market had a great 2023 despite rates rising a ton in 2022 and 2023.  Things are normalizing and while the junkycrap stocks are not likely to thrive in an environment of 3-5% Fed Funds and 2% real rate of returns, they won't do too shabby.

Take out the Magnificent Seven and the market is tilted more to the cheap side than overvalued.  The S&P 490 is at 17x EPS with the S&P 500 at 19.5x and the Top 10 at 27x EP

Edited January 2 by GoldFinger1969

[GoldFinger1969]

On 12/31/2023 at 6:23 PM, VKurtB said:

But as written by someone other than me upthread, my Truist stock pays an 8% dividend, rounded to the nearest whole number.

Not anymore.  Stock is up 30% in 2 months and the yield is down to 5.6%. 

[GoldFinger1969]

On 12/31/2023 at 5:59 PM, World Colonial said:

The dividend absolutely means something (a lot) but in and of itself doesn't change the definition of speculation and investment.  Before the current mania, it represented the majority of the return for the US stock market.  That's what should be expected in any "normal" market environment.

No, it shouldn't.  And no it didn't. 

Stocks going back to 1926 have had dividends account for about 40% of the total return when one reinvests the dividend.  But that encompasses DECADES of high-yields for the DJIA and S&P 500 (the DJIA yielded 10% in 1932).  Not until 1956 did the yield on stocks fall below that of bonds -- beause most investors had long memories and remembered stocks going down 85-90% from 1929-32.

Stocks have been de-risked because information is more easily accessible on corporate fundamentals.  In the 1880's, information on railroad stocks sometimes took hours or days to reach investors.  In the 1920's, information still took a few minutes, sometimes an hour or so.  Today, information takes seconds or less.

Yields are less important to total return compared to growth.  And I say that as a dividend and value investor.

On 12/31/2023 at 5:59 PM, World Colonial said:

A higher dividend means it's relatively less speculative and by this metric, the US stock market is close to the most speculative ever.  The dividend yield on the DJIA (2%) and S&P 500 (1.5%) is a razor's edge above the all-time early 2000 low.  The ability of a company to pay dividends is a function of the actual fundamentals.  Corporate management's decision to establish the dividend payout rate is substantially psychological (from numerous factors) and the price of the stock essentially entirely so because the company and the stock certificate aren't equivalent.

But you are eliminating a huge change from 1982:  the ability to buy back stock.  Before then, companies either hoarded cash or paid dividends.  Today, they can buy back stock and many companies prefer to do this. You have to compare shareholder yield (dividend yield + stock buyback yield) to have a valid number.

In the old days, the DJIA would be a buy at a 6% dividend yield and a sell at a 3% dividend yield.  But that encompassed a RISING rate environment from 1946-81.  We've had a FALLING rate environment for decades and even with the latest rise we are still historically low in yields.

Net-Net:  yields are not going back to the old levels on stocks because today's stocks are less-risky, more transparent, and in many respects CHEAPER with more defensive MOATS than their predecessors.

Compare today's Tech Titans to the 1970's "Nifty Fifty" stocks.  No comparision in terms of market dominance and ability to adapt.

Edited January 2 by GoldFinger1969

[VKurtB]

On 1/1/2024 at 11:53 PM, GoldFinger1969 said:

Not anymore.  Stock is up 30% in 2 months and the yield is down to 5.6%. 

8% based on MY purchase price, not the current one. 

[GoldFinger1969]

On 1/2/2024 at 2:12 PM, VKurtB said:

8% based on MY purchase price, not the current one. 

That's not relevant, the capital could be deployed into other vehicles that yield more than on "your purchase price" -- an opportunity cost -- so you have to compare apples to apples current yields at market values.

[World Colonial]

On 1/2/2024 at 12:34 AM, GoldFinger1969 said:

It's not anywhere NEAR the most historically overpriced market in history.  Not by a longshot. 

Yes, you keep telling me this, because you keep on claiming that the P/E multiple demonstrates it.  And you do this because you continue to believe in false causality, that prices are determined from supposed "fundamentals"    It's also evident you believe numerous other fallacies promoted by Wall Street too.

The P/E ratio is one of the least reliable valuation metrics.  It’s been a lagging indicator at major turning points during the 21st century mania, both tops and bottoms.  The ratio was higher at the 2002 low versus the 2000 peak and higher at the March 2009 low versus the October 2007 peak, the opposite of any actually useful indicator. This happens because the economy never leads stock prices (usually lagging) and earnings also lag economic performance somewhat.

Earnings are only relevant to "investors" to the extent they receive it as a dividend.  The dividend yield is barely above the all-time low from the 2000 dot.com bubble, and this is even with all the economic distortions since at least 2008 which you also completely ignore.

Earnings (cash flow) is a return on actual investment, but 99%+ of supposed “investors” are engaging in speculation, on changes in the share price.  That's what they actually bought, a stock certificate, not a "piece of a business" because the company and the company shares aren't equivalent.   Here is what 99%+ of all shareholders actually receive:

1)·A periodic dividend payment (if any) which currently is usually immaterial.

2) Voting for corporate directors, irrelevant to 99%+ of shareholders, as they have no ability to actually influence corporate policy or strategy.  That’s what makes them speculators.

3) A pro-rated share of net corporate assets in the event of liquidation.  No one actually buys any stock for this reason.

4) Right to sell at the future market price, which is speculation on potential financial appreciation whether or not the company creates any net economic value at all.  In the 21^st century mania, that’s what the “investor” is primarily buying and what’s mostly reflected in the share price for most US stocks.

“Investors” acquire specific legal rights with share ownership (see my list below), but don’t possess the required characteristics of actual business owners; any semblance of decision-making authority.  If you have enough influence to make your “voice” heard, you’re an actual investor.  In theory if not in practice, that’s board members, selective members of the C-Suite (CEO, COO, CFO), and anyone who can actually influence these people or select them, but no one else.   If you can’t make your “voice” heard, then you own “a piece of paper”, earnings are of no direct relevance to you, and you are a speculator. 

That's all I can write for this post, but I have plenty more to add if neccessary.

Edited January 5 by World Colonial

[World Colonial]

On 1/2/2024 at 1:03 AM, GoldFinger1969 said:

No, it shouldn't.  And no it didn't. 

Stocks going back to 1926 have had dividends account for about 40% of the total return when one reinvests the dividend.  But that encompasses DECADES of high-yields for the DJIA and S&P 500 (the DJIA yielded 10% in 1932).  Not until 1956 did the yield on stocks fall below that of bonds -- beause most investors had long memories and remembered stocks going down 85-90% from 1929-32.

I already know this.  It's not news to me.

Yes, the change in the relative return between dividends and appreciation is due to psychology, exactly as I have been telling you.  That's exactly why "investors" are willing to accept such low yields now whereas they wouldn't before.

On 1/2/2024 at 1:03 AM, GoldFinger1969 said:

Stocks have been de-risked because information is more easily accessible on corporate fundamentals.  In the 1880's, information on railroad stocks sometimes took hours or days to reach investors.  In the 1920's, information still took a few minutes, sometimes an hour or so.  Today, information takes seconds or less.

Yields are less important to total return compared to growth.  And I say that as a dividend and value investor.

Total BS

"information" has nothing to do with valuation or prices.  Same false causality fallacy. How many times have you heard someone say something is only worth what someone will pay for it?  More than I can count.  But supposedly, that doesn't apply to "investments" because that's derived from "fundamentals"

This belief is also based upon the bogus "discounting" claim from the Efficient Market Hypothesis (EMH).  I haven't heard anyone mention EMH in decades (since it's completely absurd) but that's what's still implicitly consensus belief and it's believed due to the concurrent belief in the impact of "fundamentals", not just present but future.

There is no "discounting" in the implied sense.  “The market” (market participants collectively) can’t discount anything, because it’s an anthropomorphic abstraction from collective “investor” belief in false causality.  It’s absurd to believe “the market” somehow “knows” anything.  “The market” isn’t alive knowing what individuals know collectively.  That’s a quasi-form of pantheism and another “rabbit hole” altogether. 

As for individuals, I infer they believe this implicitly, when there is any evaluation at all (e.g., not “meme” stocks.)  In at least one post, you cited behavior that “investors” typically (if not usually) put more research into the purchase of a low to mid-priced consumer good, like a toaster oven.  This should be expected, since the vast majority of “investors” don’t “invest” directly and direct stock purchases represent a (decreasing) minority of share ownership.  They “invest” on auto pilot (e.g., 401K) through index funds or delegating stock selection to money managers.  When buying shares directly, “Investors” are also mostly ignorant of economics and accounting, know little if anything about statistics and present value, mostly don’t know anything about or understand the business represented by the company shares they buy, and how other “fundamentals” supposedly relate to stock prices.  So how can they discount anything where this information you have repeatedly referenced makes any difference?

The answer is they can’t, meaning this supposed discounting is actually psychological as I told you, not an analysis of how events ("information") supposedly impact prices economically.  It’s what ‘investors” believe and acting on this belief that matters, not the event(s) or aby supposed "information".

What about quantitative valuation methods, more common among institutions?  It’s still psychologically based, because these predictive methods use assumptions biased by the user’s optimism or pessimism.  There is no objective valuation method since there is no correct value.  There is relative value, but since discounting attempts to predict future returns, it cannot avoid subjectivity either.

Look at the dot.com bubble, current “bubble” stocks, “meme” stocks, “disruptors”, “unicorns”, and serial money losers.  Consensus implicitly admits these prices are psychologically determined while concurrently believing other prices are the result of the “fundamentals”.  The same psychology responsible for “bubbles” accounts for all prices, all the time, without exception. “Investors” don’t “accurately” judge value “rationally”, except when “bubbles” occur.  Believing this is a total absurdity since value is an arbitrary abstract mental construct. 

Value is an arbitrary mental construct.  It’s not contingent on anything, except collective perception.  That’s why it fluctuates so radically independently of any supposed “fundamentals”.  That’s why a raging mania (the one we have now) facilitated by deranged government policy (since at least 2008) can inflate fake “wealth” to such ridiculous heights, unlike real wealth requiring actual effort.  If financial values were contingent on or subject to constraints in the physical world, it wouldn’t be possible.

[World Colonial]

On 1/2/2024 at 1:03 AM, GoldFinger1969 said:

But you are eliminating a huge change from 1982:  the ability to buy back stock.  Before then, companies either hoarded cash or paid dividends.  Today, they can buy back stock and many companies prefer to do this. You have to compare shareholder yield (dividend yield + stock buyback yield) to have a valid number.

No, I didn't forget anything.  I didn't address it in my prior posts but anticipated you would make this claim.

Stock buybacks don't "return cash" to shareholders.  That's another Wall Street lie.

Stock buybacks increase demand for what “investors” actually bought – the stock certificate – but they don’t actually receive anything from the company, unless something is supposed to include an increase in an accounting number, what's reflected in EPS.  That's why this conventional claim is not accurate.

If you sell your shares, you don’t own it, do you?  So, you didn’t get anything just like shareholders who sold don’t receive dividends either. Selling is selling and who you sold your shares to doesn’t alter the outcome. 

It’s not “returning cash” to shareholders if the company buys it but different if sold to someone else.  Shareholders who didn’t sell obviously didn’t receive anything.   A legal claim to a higher proportional share of an accounting number (EPS) isn’t cash. 

And before you answer, I know why management does it and why many shareholders favor it.  I know that stock buybacks usually correlate to higher stock prices, but this still doesn't support the conventional claim.

Edited January 5 by World Colonial

[World Colonial]

On 1/2/2024 at 1:03 AM, GoldFinger1969 said:

In the old days, the DJIA would be a buy at a 6% dividend yield and a sell at a 3% dividend yield.  But that encompassed a RISING rate environment from 1946-81.  We've had a FALLING rate environment for decades and even with the latest rise we are still historically low in yields.

Interest rates are also psychologically determined.  No one can explain interest rates from "fundamentals" either.  I've explained this numerous times before and can do it again.  It certainly isn't due to any supposed omnipotence by the modern economic priesthood, those working at central banks and government treasury departments.

On 1/2/2024 at 1:03 AM, GoldFinger1969 said:

Net-Net:  yields are not going back to the old levels on stocks because today's stocks are less-risky, more transparent, and in many respects CHEAPER with more defensive MOATS than their predecessors.

Compare today's Tech Titans to the 1970's "Nifty Fifty" stocks.  No comparision in terms of market dominance and ability to adapt.

More of your belief in false causality.  Everything you believe is entirely the result of the asset mania.

Read some history.  You're read "Extraordinary Popular Delusions and the Madness of Crowds" and "Manias, Panics, and Crashes".  I presume you have.  The level of speculation and valuation dwarfs these precedents and the only reason anyone will believe it has no relevance or doesn't matter is because they believe in a form of modern alchemy as I wrote in a prior post in this thread a few days ago.  

Yes, I am aware of these "defensive moats" which is actually mostly a code word for oligopolistic and monopolistic corporate behavior.  But since "fundamentals" don't determined prices, it doesn't mean what you claim anyway.

[World Colonial]

Double post

Edited January 5 by World Colonial

[zadok]

On 1/4/2024 at 6:00 PM, World Colonial said:

Yes, you keep telling me this, because you keep on claiming that the P/E multiple demonstrates it.  And you do this because you continue to believe in false causality, that prices are determined from supposed "fundamentals"    It's also evident you believe numerous other fallacies promoted by Wall Street too.

The P/E ratio is one of the least reliable valuation metrics.  It’s been a lagging indicator at major turning points during the 21st century mania, both tops and bottoms.  The ratio was higher at the 2002 low versus the 2000 peak and higher at the March 2009 low versus the October 2007 peak, the opposite of any actually useful indicator. This happens because the economy never leads stock prices (usually lagging) and earnings also lag economic performance somewhat.

Earnings are only relevant to "investors" to the extent they receive it as a dividend.  The dividend yield is barely above the all-time low from the 2000 dot.com bubble, and this is even with all the economic distortions since at least 2008 which you also completely ignore.

Earnings (cash flow) is a return on actual investment, but 99%+ of supposed “investors” are engaging in speculation, on changes in the share price.  That's what they actually bought, a stock certificate, not a "piece of a business" because the company and the company shares aren't equivalent.   Here is what 99%+ of all shareholders actually receive:

1)·A periodic dividend payment (if any) which currently is usually immaterial.

2) Voting for corporate directors, irrelevant to 99%+ of shareholders, as they have no ability to actually influence corporate policy or strategy.  That’s what makes them speculators.

3) A pro-rated share of net corporate assets in the event of liquidation.  No one actually buys any stock for this reason.

4) Right to sell at the future market price, which is speculation on potential financial appreciation whether or not the company creates any net economic value at all.  In the 21^st century mania, that’s what the “investor” is primarily buying and what’s mostly reflected in the share price for most US stocks.

“Investors” acquire specific legal rights with share ownership (see my list below), but don’t possess the required characteristics of actual business owners; any semblance of decision-making authority.  If you have enough influence to make your “voice” heard, you’re an actual investor.  In theory if not in practice, that’s board members, selective members of the C-Suite (CEO, COO, CFO), and anyone who can actually influence these people or select them, but no one else.   If you can’t make your “voice” heard, then you own “a piece of paper”, earnings are of no direct relevance to you, and you are a speculator. 

That's all I can write for this post, but I have plenty more to add if neccessary.

...mostly agree...except for the pro-rated share of net assets...i guess im the "no one" here, i actually track such assets...i purchased stock in a railroad that was headed for bankruptcy at extremely depressed prices because all of the legal documentation had failed to adjust for the land value on the abandoned track right of ways, net return bout 12,000%...i agree this is an extremely limited avenue of opportunity, but someone has to do it....

[VKurtB]

On 1/4/2024 at 8:02 PM, zadok said:

...mostly agree...except for the pro-rated share of net assets...i guess im the "no one" here, i actually track such assets...i purchased stock in a railroad that was headed for bankruptcy at extremely depressed prices because all of the legal documentation had failed to adjust for the land value on the abandoned track right of ways, net return bout 12,000%...i agree this is an extremely limited avenue of opportunity, but someone has to do it....

This idea that P/E ratios are somehow bogus is itself the bogus part of the conversation. It’s complete poppycock. P/E ratios are a perfectly fine metric. Whether those earnings are paid as dividends, or used to buy back stock, or used to finance growth in key areas, or EVEN to engage in M&A activities, thus making it unnecessary to finance that with debt, is about 99% immaterial. It ALL becomes shareholder value. Now of course if they want to use it to pay obscene management salaries, or pursue DEI activities, that is an invitation to sell immediately and run for the hills, and I shall, right after I vote down that garbage with my proxy form. 

Edited January 5 by VKurtB