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You're conflating compounding market value with economic growth. One counterexample is when inflation raises prices, but not economic output. Asset prices grow but there's no growth.

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ajmurmann an hour ago | parent [-]

What do you think happens with the money that goes into stock? It doesn't simply vanish. It ultimately gets invested in salaries, construction of data centers and factories.

	▲	kubb an hour ago \| parent [-]
		That's most certainly not what happens! The money that goes into buying a stock is being transferred to the people who sold you the stock (which, outside of the IPO are almost always market players). A company with a high stock price can "save money" by paying employees in stock, borrowing money cheaper, but it's NOT a primary way of funding the company.

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wqaatwt 2 hours ago | parent | prev | next [-]

Or hoarding real estate.. which is not particularly productive since it turns out higher prices don’t really stimulate supply sufficiently.

Also its not exactly obvious how much inflated stock market valuations benefit the economy that much or at all.

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paulryanrogers 2 hours ago | parent | prev [-]

Then why is so much money going into real estate and greater-fool crypto?

	▲	ajmurmann an hour ago \| parent [-]
		BTC market cap is $1.2T. S&P 500 market cap is about $66T. Why would we not want for money to flow into real estate? It's an area with massive demand and money flowing in to create supply is exactly what we need and is productive. What is not productive is the NIMBY scum that's preventing supply from being met.