askchapo

It boils down to the same argument that bootlickers use to defend billionaires: it's not "real" money. The assets (stocks) gain or lose "value"--the theoretical amount that it could be sold for based on the most recent sale of that asset.

So when a stock goes down, all of the existing bits are "worth less", but they're also the same worthless pieces of paper they always were, in the same quantity. It's just about how much some other theoretical sucker is theoretically willing to pay for it.

But the thing is, this being a giant fucking casino, there's ways for individuals and companies to make money no matter what is happening to the line. You can place bets that a stock will go down. You can place bets that a stock will go up. Neither of these require actually owning the stock. You can even sell stock you don't actually own with the intent to buy it when it goes down. Shit's insane.

So even when the "market is down", folks are still making money hand over fist. The actual total value of all stocks out there is just some random bullshit magic number based on wishful thinking neoliberal economics. What matters is how much you can screw someone else, because that's where actual money is made and lost.

Every interaction in the stock market has a winner and a loser. If I sell a stock high and it keeps going up, I made less than I could have. If I sell a stock low and it goes up, I lost money. If I buy a stock high and it goes down, i lost money. If I buy a stock low and it goes up, I made money, but whoever I bought it from missed out.

Stock prices are 100% vibes based. There's fake math out there that defines "what a stock price should be" (defined by warren buffet which is why he is always getting richer it's self-fulfilling at this point) but these pieces of paper are literally just worth whatever someone else will pay for it.

That money never existed. If everyone tried to pull out of the stock market at once, the banks would run out of money in seconds. As for people making money on the turmoil: everyone that knew the tariffs were coming sold a bunch of stocks at the peak and were able to buy more when it crashed. This is basically a total market pump n dump.

That money goes to hell, for being bad money.

Short answer is there is no money anywhere, until the stock is sold. Just an asking price people are willing to pay and a selling price people are willing to sell at.

It doesn't go anywhere since it was theoretical to begin with. Think of a video game. If you buy a game for $60, then resell it later for $30, technically you've lost $30. However, you could hold on to the game and maybe it becomes rare and you sell it later for $120 and turn a $60 profit!

Or, maybe the game's resale price dips to $30, but you don't sell it, then it later shoots up to $120 and you sell. When it was $30, you could misleadingly claim that you've "lost $30" on it, but you didn't really, since you still own the game and in this case you actually sold it for a profit later.

The gain/loss is only realized when you sell the game, so whether you'd consider yourself a winner or loser would entirely depend on when you sell and how much you sell it for. Still sucks to see the value go down when you own it though, since it decreases your chances of making a profit and means you'd need to hold on to it longer if you want to turn a profit.

The stock market value (and companies values) is what it would be worth if 100% of it was sold at the current going rate. In reality, selling something actually lowers the price a little since it increases supply, so if 100% of any company/market were sold on the open market in a short amount of time, the price of each share would tank hard and the actual sale price would be much much lower than the initial "value" or market cap.

There are ways to make money when a stock's price drops, puts and shorts are the two most common. But that's out of the scope of the question you're asking.

So when people talk about "the value of the stock market" they're doing an extremely dubious bit of reasoning where they're taking the recent transactions and multiplying by the number of stocks. When the stock market surges or collapses some small fraction of those stocks are being sold at higher or lower prices than they were recently. That's it, no money is made or lost except by the sellers comparing historical buy price, and sale price modified for dividends, inflation, and opportunity cost.

Naively stocks, being a portion of legal right to the profits and assets of a company, might be expected to track the actual productive capacity of a company +/- material assets and debts. They do not do this, they are 100% speculative vibes. If the vibes are good people might want to buy for more in the future so line goes up. Bad vibes? The line goes down.

Money is made real by trust that others trust that money is made real. That society is functioning enough that if I do a thing for you or give up some material asset, I will be able to later claim some service or asset without needing to ensure I am made good now. That debts need not ever be made square because the structure of mutual indebtedness is sound.

So when the line goes down or up, because everyone believes this is extremely important, it does affect people's trust that money means what we thought it meant moments ago and this has an effect on people's willingness to give loans or do work expecting that future returns will mean something then. This is like potential future money though, it's not like underneath stock exchanges a group of robed individuals ritually burn some dollars while a single tear rolls down their cheek.

If you're thinking: "This is dumb, this is so fucking dumb. We could just ignore stocks and do productive things for each other and the social compact would hold without this insane and precarious system" well... yes.

It doesn't go anywhere because it never existed in the first place.

It's like when it's the day after Easter and all the Easter candy gets discounted. If you took the previous total price of all the candy and figured out how much it went down after the discounts, then you could figure out how much the Easter candy market "dropped" but it's not a meaningful measure for anything.

Why we treat it as a meangingful measurement and base our society around it..., that's beyond me.

It goes to me baybee im on my yacht n shit

Same place they came from.

The value of money here is built on trust in the stock value so who does the lost trust go to? To gaslighters of course