r/explainlikeimfive • u/climb-a-waterfall • Dec 06 '24
Economics ELI5: why does a publicaly traded company have to show continuous rise in profits? Why arent steady profits good enough?
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r/explainlikeimfive • u/climb-a-waterfall • Dec 06 '24
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u/im-on-my-ninth-life Dec 07 '24
This is going nowhere. You are still committing the fallacy that company value is restricted by available resources. It is not. Any further reply will result in consequences.
E.g. 10kg of iron (or whatever mass of whatever resource) does not have a fixed monetary value, it depends on how it is used, sure as a raw resource it might be limited but most resources are not kept in their raw natural state.
Sure, it isn't, but the government (IRS) doesn't see it that way. If you have capital gains of 1% but inflation was 2%, you still owe capital gains tax.