The Ponzi Factor

"All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as self-evident." (Arthur Schopenhauer)

The Ponzi Factor is the most comprehensive research ever compiled on the negative-sum nature of capital gains (non-dividend stocks). This means, as a whole, ALL investors will lose money from buying and selling stocks.

Most people don’t realize that profits from buying and selling stocks come from other investors who are also buying and selling stocks. When one investor buys low and sells high, another investor is also buying high and needs to sell for even higher.

Companies like Google, Telsa, Facebook never pay their investors. Their investors’ profits are dependent on the inflow of money from new investors, which by definition, is how a Ponzi scheme works.

This book is not for everyone. If you are a finance junkie who wants to rationalize why companies don’t have to pay their investors and believe a system that shuffles money between investor can magically create more money than people contribute, then this book is not for you. On the other hand, if you understand that money doesn’t grow on trees and investors invest because they want money, not value, then you will learn something you will never forget: the simple truth about what makes a stock price move and the mechanics of how the stock market really works.

A stock without dividends is a Ponzi asset. It’s not how ownership instruments were designed to work historically or logically.

True ideas will never disappear. It can be covered, and we can get distracted, but the truth never goes away and becomes self-evident over time. The Ponzi Factor is not a perspective or an opinion. It is a proof that is based on definition, logic, and it is supported by observable facts and history. This is not a story that will disappear after another market crash. It is an idea that will remain relevant for as long as the stock market exists.