• infinitesunrise@slrpnk.net
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    7 days ago

    As they’re a completely disenfranchised social majority on an island with a population tiny enough for everyone to know everyone else and a robust enough technological base to justify something like a stock market, they buy nothing and successfully institute anarcho-communism! :D

    But to take the scenario seriously: Assuming that there was still demand for the shares among the population, the people seeking shares would offer more money for them than they were originally worth, until some of the people who own them considered it worthwhile to sell. If this alone doesn’t sate demand then the two stock-issuing companies would almost certainly issue more stock, ideally enough for them to raise more funding but not so much that the increased supply overwhelms demand and drops the price per share. They could also split the stock: Every share in circulation instantly becomes two shares, worth half of an older share at time of split. Depends on which market outcomes the companies are seeking. But basically the response to your scenario is that stock issuance is completely arbitrary (Within regulatory limits, whatever they may be) and up to the issuing company, and a market with demand is a market that will be offered shares because to a company it’s just fundraising waiting for the taking. The only thing they can’t do is disappear stock in circulation, if they wanted to remove stock for some reason they’d have to buy it back from holders on the market.

    • plyth@feddit.org
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      6 days ago

      The problem is that shares cannot rise arbitrarily in price because the value depends on the profits.

      On the other hand, if there are no new business opportunities, handing out shares decreases profits per share and thus also their value.

      I want to show that not everybody can invest their money in funds or the ROI would crumble.