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Stocks – The Great “Wealth” Equalizer?
Written by Lance Roberts | Aug, 4, 2017

Just recently, the New York Post a very interesting article entitled “Millennials should start taking stocks seriously.” While I am sure the author is well-intentioned, it is a very misguided article in its assumptions.

The author jumps right in with both feet:

“Many millennials are missing the chance to accumulate significant assets.”

There are so many problems with that statement alone its tough to find a starting point.

First, the stock market is not, and never has been, the “solution” to building wealth. If you look around the world, there might be a very small handful that have actually built a fortune by investing alone. That is the exception, not the rule.

The real wealth builder, even for guys like Ray Dalio, Larry Fink, Warren Buffett and others, was not from just investing their own money in the financial markets but by building businesses that invested “other peoples money” in the financial markets from which they collected heavy fees and compensation over time.

In America, the great “wealth equalizer” is, and always has been, entrepreneurship. But, unfortunately, according to a recent Federal Reserve study, since the financial crisis business equity ownership has declined markedly.

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Close:

Importantly, I am not advocating “market timing” by any means. What I am suggesting is that if you are going to invest into the financial markets, arguably the single most complicated game on the planet, then you need to have some measure to protect your investment capital from significant losses.

While the detrimental effect of a bear market can be eventually be recovered, the time lost during that process can not. This is a point that is consistently missed by the ever bullish media parade chastising individuals for not having their money invested in the financial markets.

The reality is that most of these individuals have never lived through a real bear market, nor have they ever suffered the losses of significant wealth during the process. Their time will eventually come, and as anyone who has been around the financial markets for as long as I have (28 years) will tell you, your attitude about “risk” changes significantly when the “bear begins to maul you.”

USE LINK FOR FULL and IMAGES:
https://realinvestmentadvice.com/stocks-the-great-wealth-equalizer/