The more I study the stock market and finance, the more I'm convince the entire system is deeply unfair. I've learned I can make money on the stock market fairly easily. Some will say the money is earned because I must be smart, or skilled or something. Slight problem: The amount of money I can make is entirely dependent upon how much money I have.
I started trading on margin. What's the interest rate on that? Well, depends on how much money is in the account. People with lots of money, only pay 5.75%. Not so wealthy people, pay as much as 9.75%. That means, if they were getting 10% annual return on the money before, using margin trading could increase the wealthy person's profit to 14.25%. Meanwhile the not so rich would only be getting 10.25%. I actually have an uncle who's super rich, and can borrow below 2% interest. For him, that 10% would become 18%. I've heard that hedge funds frequently operate on 10x leverage. Meaning for every dollar they have, they borrow 10. That could easily multiply their profits 5x or more (probably more, depends on how much they pay to borrow the money).
The stock market is a rigged game. The rich can make off like bandits with tons of money, while providing very little to the economy. Numbers just inflate. Even if I do eventually make enough money to support myself, I don't think I could claim to be providing society with a useful service. I'm just exploiting a rigged game.
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