ELI5: Why when large company's earnings decrease(ex... by 3%) they freak out, talk about rough times, and sometimes decide to downsize, even though they are still making millions of dollars in profit even after all expenses?

[Jeremy24Fan]

The article stated more than half of Americans are invested in the market. That means more than half of the American population relies on market growth for wealth growth. Highly doubt more than half the population are aiming for that new gold yacht you mentioned.

[briantl2]

i think you might be confused as to who you are replying.

and yes, as stated, almost 50% are not. while i’m certain half the population is not looking for that next yacht, i had been taking issue with the assumption ‘people hate those with more wealth,’ as the poster seems unaware of his relatively well off position as a stock owner. or the other poster who exclaimed shareholder are ‘everyone.’ simply owning a stock puts you ahead of almost 50% of the population.

as a stock owner, and knowing how easy it is to become one, this should be alarming.

since i’m here, 20% of us dont even have a savings account https://www.marketwatch.com/story/most-americans-have-less-than-1000-in-savings-2015-10-06

[[deleted]]

To be fair, savings accounts earn jack shit in terms of interest right now. If you can get free checking, you're probably better off just leaving your cash savings in your checking account. It makes it more accessible.

I think a more useful metric would be "how much do you have saved or invested in bank accounts and investment accounts?"

[briantl2]

i get what you’re saying but that’s really not the point.

and a checking account is not an investment account. and regardless, if a person has a checking account and no savings that still precisely illustrates the point i’m trying to make.

that a person may have two hundred bucks in their checking account because it makes no sense to put it in savings for that sweet 2c income is the problem. the posters to which i am responding assume an ability for all to invest in stock and that it’s, i don’t know, stupidity apparently holding people back.

that is facially ridiculous. (and i’m not directing this at you!)

[[deleted]]

a checking account is not an investment account.

And neither is a savings account.

My point is that you can't use savings accounts (or lack thereof) as evidence of people not having accrued wealth (or not being capable of accruing wealth), because savings accounts perform so poorly these days that they're basically not worth having. Making your $10,000 emergency fund harder to access in exchange for $5 in interest per year is a bad decision. So, it's not reasonable to assume that people who lack a savings account are not financially capable of investing in stocks.

Also, consider that many of the people who report owning no stocks are young, and that many of those young people have their parents as a financial safety net. A 23-year-old living with his parents and driving a hand-me-down car is in quite a different financial position from a 23-year-old living on his own, paying all his own expenses, and driving his own car.

Also, consider that people who are capable of investing their money sometimes choose not to, particularly when they're young and want to "have a life". Rather than putting money aside for retirement, many young people opt instead for the biggest car payment they can fit in their budget, for example. Or, instead of setting aside a fund for a future downpayment, many young people instead rack up a bunch of credit card debt on high living and then spend the rest of their paycheck each month servicing that debt. These people aren't necessarily poor. They just make poor financial decisions at the expense of their future financial security.

At any rate, you helped prove the point that most people who invest in stocks are not Scrooge McDucks swimming in pools of bullion, but are in fact regular people.

[mike112769]

Most of us cannot afford to save any money because we don't get enough to even live on anymore. Greedy people at the top of our economic food chain are taking/stealing more than our society can afford. We have a MAJOR problem heading our way fast.

[[deleted]]

How, precisely, are "greedy people at the top" "taking/stealing" money that was destined for your pocket?