Well, before the market went up your neighbor had $9,999,990 more money (in this asset) than you did. Afterwards he has $19,999,9980 more. I think he has done better than you have.
Gene Bill Lear wrote: > On Thursday, August 15, 2002 at 07:46:14 (-0700) Michael Perelman writes: > >I would suggest that redistribution is real. The fictitious capital > >associated with capital gains through the wealth effect bids up the cost > >of goods such as housing. That asset bubble also has real consequences > >for renters who get displaced. > > I still don't get it. If I have 10 shares of 1 dollar stock and it > goes up by 1 dollar, I have doubled my money (I mistakenly said > earlier I had 10 times more money!). My neighbor with 10 million > shares has also doubled his money. The wealth of each of us, purely > through the stock market, has risen by 100%. > > Baker's point seems to be very narrow --- that the rising stock market > itself "is primarily a redistribution". If he meant possible > associated price inflation, why didn't he say that? > > Bill
