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To: zax who wrote (12867)	8/8/1998 12:23:00 PM
From: Charlie J	Read Replies (3) \| Respond to of 164687

<<Think of it as "cream rising to the top". These losses of others are your gains. You will invest the money in undervalued companies providing key technologies, funding the future growth of our great country.>> This statement seems to imply that if you buy shares of public companies, you can be helping them. But, unless you: 1) buy shares and invest in a company while it is still private, or 2) buy shares in an IPO offering, then the money from purchasing stocks does not go to the company, it simply goes to the person who had previously purchased the shares. I'm surprised at how often I see this notion, that investing in a company's stock will directly help it. <<I am only trying to console a friend, who is struggling to come to grips with the terrible nature of making money in a zero sum game. Unfortunately, unlike profitable companies, this is all that the stock market is.>> It's not a zero-sum game. A company is founded. Later it sells pieces of ownership to the public. The company grows and the shares become worth more. The last purchaser is betting the company will continue to grow and that the shares will later be worth even more. Microsoft, for example, has grown and grown and grown. The stock price has gone up and up and up. It's not a case that every time someone has made $100 on the stock, someone else has lost $100. Nor is it a case that at some point all the money must be lost, bringing it back to zero. That's why they call it 'wealth creation.' Puts and calls are a zero-sum game, but not the 'stock market.'