Quote:
Originally Posted by Mutt
It's amazing, it's like it's a big scam run by Wall Street. If people keep buying your stock maintaining or increasing the share price then a company can just go on losing money - until the market loses faith in the company.
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Well, no.. and yes. Depending what you mean. Stock price doesn't bring any money to the company itself, unless it sells its own stocks or issues new shares (that is usually based on listed stock price, but is not the same thing).
So, unless the company sells its own stocks in a way or another; it will go down without other money sources, like loaning money.
About the other issue; investing vs dividents. Theoretically it is considered that selling stocks to get money from raised stock price and dividents are the same thing as a money source, but I prefer dividents. Also in the case of large stock holders; you don't lose voting power with dividents, as it is usually vote per share (unless there is different stock series). So if you want to rule the company, dividents are always better than selling your power over the company.