Issue 367 Poor and Stocks July 20, 2015

Stocks are a gamble on your money.  It is you giving a company money in the same fashion of a loan in the hopes of profiting off the interest.  However, the poor in our country has limited access to a degree in my opinion, and I feel that if they did have access, they could benefit greatly.  Let us discuss.

Access:  The poor generally do not have access due to a lack of disposable income to risk on investing.  As such, they do not even bother learning how to invest, which makes it harder for them to try and do so later on.  Also, even if they do invest, they are taxed on it for taking it out for it is considered income.  This becomes another inhibitor because, why would you invest money when you cannot use/maximize the money you just earned.   Additionally, stocks are intertwined with business as more investment means business expands and generally means more people getting jobs.  So how can we increase access?

Increasing access:  For one, we can make this money non-taxable when taking it out.  This would benefit everyone as this means people can freely invest and could potentially become millionaires overnight with the right investments.  Likewise, this would allow people and companies to invest more readily which means business expands and unemployment decreases.    We can also make it non-taxable going in just like a 401k which also preserves money for the poor and especially for those transitioning out of poverty.

To ensure that people do not make poor investment choices, all financial data will be readily available upon request and in real time as opposed to the current law which says simply that they have to release data in a timely fashion.  This has the effect of eliminating insider trading laws as everyone would know what is going on with a business's finances and market value at any given time.  In combination with the real time knowledge, a real time report on stock stability and investment can be devised along with predictions so that the people investing can buy, sell and trade freely without limit so as to avoid any losses.  So one company or even treasury bonds of a particular country or any form of stable investment can be deemed safe for an upcoming collapse, which would provide flexibility and aid in avoiding losses for the investors.  This of course means all companies and all countries that can be invested in must be able to be freely traded globally in a manner similar to free trade among nations.   To also aid in investing and to avoid middle man costs, companies could and maybe should allow for open source direct investments.  This scheme would literally be a link on their website, or a kiosk in their store that allows you to buy stock in that company directly.  So no more brokers to get in the way of your investing.

Conclusion:  So access can be increased, though obviously disposable income is still an issue.  However, everyone can benefit from these changes with respect to monetary gain, and jobs open up simply because investing gives companies disposable capital to expand and thus creating a need for jobs to be filled.  A freer system equals more chances to get out of poverty.  Investing is simply one tool to do that.