As such China can require you to follow their laws without giving a fuck about what laws the US has.
Any US company is going to not sign a contract without some stipulation about following US laws. FYI, most international contracts have a clause that says it will be interpretted in New York - no matter where the companies are based.
Especially since the companies all have contracts with China now. If they decided to stop providing service, they are hit with penalty clauses - not to mention the black eye that breaking a contract would give them.
But all contracts have a "separability clause" that says that anything in the contract that violates the law is automatically declared void without effecting the rest of the contract. So the contract payments et al remain in effect, while the agreement to be evil goes away.
I have a rule: "Doing something that you know won't work is never the right thing." That is my primary beef with liberals, in fact. If the stuff they proposed had a result that even maintained the status quo, it would be wonderful. The problem is that they "do the right thing," and make things far worse because "doing the right thing" was not realistic.
If you know that giving your starving brother money will result in him buying drugs instead of food, it is immoral to give him money. Come up with a different plan.
In a CMOS-like technology, you want overall capacitance as small as possible - because you have to charge and discharge that capacitor once per cycle. A first order approximation of power used is 0.5*Capacitance*(voltage squared). A first order approximation of the speed of the device is voltage*current/capacitance (where current is an exponential function of voltage). This means that from a circuit perspective, capacitance is the root of all evil (it both slows you down and uses up power).
When you look at it from inside the device, things change. Transistors work by having the gate-channel capacitor charge up and discharge. You need a certain amount of capacitance for it to work. An easier way to look at it might be to consider the electric fields instead of capacitance. A high K dielectric concentrates the fields in the channel instead of inside the gate oxide. This way, the fields are applied where they are useful (the channel) instead of where they are unneeded (the gate oxide). Obviously, this is somewhat of a simplification, but hopefully you get the gist of it - the capacitance is necessary inside the device, and by using a high-K dielectric you can concentrate that capacitance where you need it.
In addition to what others have said, please consider this:
1. There is a set amount of total gold in the world. 2. Once all that gold is in circulation, the total possible cash is a set value. 3. The economy grows (as in, more computers per capita, more employees, whatever). Therefore: 4. You now have to give everyone in the entire economy yearly salary cuts in order to allow for the expansion. 5. Anyone the has more money than they need can now just sit on it and it gets more valuable each year.
Is that the world you want to live in?
Further, reality is that not all the gold in the world has been mined. So instead of having a psuedo-government body regulate the economy using monetary policy, you have random "gold strikes" creating large, random fluctuations in currency. Great job, there.
In addition to your comments, if something is more expensive it probably consumed lots of resources to create. So anything that costs you more than just buying fuel/electricity is almost certainly net harmful to the environment.
The economy works quite well - it is a good way to tell what you should do. Its main failings in this are externalities - but they do not amount to $500K. The most I've ever heard of is doubling the price of oil takes care of externalities.
No,no - I gave the obvious way out. Everyone should lie about their salary! That way, everyone thinks that they are making the most money and is happy!
I agree with you, but to turn it around in a crazy twist its also wrong at the other end - if you have $100B in the bank, you no longer want to make yourself richer. The only way you can become happier is to raise others up, so that people will stop working on how to make more food (because that work will be done), and will start working on how to make rich people happier - because you created a market of rich people!
(Of course, this only makes sense if you remember that since economics is not a zero sum game you can make others rich without adversely effected your own wealth).
Another aspect of this is that the commonly (mis)reported metric is that the top 1% have x% of the wealth of the country. First, we should be looking at income, not wealth - wealth is merely a measure of by how much your income exceeds your expenditures, integrated over time. You can accumulate vast wealth merely by saving half of your money, passing it to your kids, and having them do the same.
But that aside, when you look at income disparity closely - you can easily see that it is an emergent characteristic of having a poisson-like income distribution. As far as I can tell, the entire increase in this metric can be attributed to population growth - as you have a larger population, the outliers get further away from the mean.
We know this intuitively - noone is surprised that the tallest person in the world is from China, not the US. They simply have a larger base from which to pull random samples. As an economy has a larger base (population), you see the same effect - the richest get richer. We would also see the mirroring effect, the poorest getting poorer, except for government and social programs fighting to prevent that.
I'm not saying that this is good or bad - just that people need to realize that the reason for this is statistics, not really greed. So the solution (if any) needs to take that into consideration.
I don't think anybody would suggest that paying a banker a lot of money will suddenly cause someone to become a street robber.
In fact (though I really doubt it is true of the US), I'm certain the opposite is true - if their are lots of robbers and murderers, someone will require an obscene salary to stay there and be a banker...
How much of a raise would you require to move to an area of the city where gang warfare is commonplace?
Interestingly, what you describe is exactly how the US is set up... how it's supposed to work.
But in reality, when I lost the use of my legs several years ago and couldn't hold a job, my welfare claim was denied - I survived by doing odd jobs and living in a cheap part of the country. Now that I have climbed up in society (which is due in a large part to my struggles in overcoming the obstacles I faced), I pay over a third of my income to the welfare lottery. Only people that the government chooses win that lottery - certain races, born in the right area, etc.
Having government services (like health care) help, I'm sure - but in the US, you can still get health care without any money, and I would be the one to know about that. My point is that, at least in my experience in the US, the poor get better (or at least more consistently) treated by private citizens and companies than by the government.
So make sure you know what you are talking about - I'm sure Sweden doesn't have these problems, but having a government system in placed does not mean there is no problem.
It is not an entirely zero-sum game, but it is true that the more wealth the richest have, the less the rest of us have.
I agree with everything you say, except for this statement. We do not have a zero-sum game, not even close! The way society works is that value is created by people typically working together, and then that value is haggled over to see who keeps what. Capitalism means the society gets the most (because in 50 years whatever you create becomes a commodity with very little profit in it), but the rest is divided amongst the people that had a hand in creating it - either developing it, funding it, or managing it.
The real problem is that you have "developing it" people negotiating their share with "managing it" people who are hired because of their ability to negotiate! That is the real inequality. For example, in general I am against a minimum wage - but once unemployment is low enough, setting a minimum wage is merely the government negotiating on behalf of the worst negotiators, the poor.
The reason I think this is important is that if you believe in a zero sum game, then you pull down the rich through taxes, and give it away to the poor. We know for an absolute fact that this damages the economy. If you understand that it is not zero sum, then you can use minimum wage laws to raise the poor instead of lowering the rich.
Personally, I would like to see laws passed that require employers to allow employees to hire negotiators to handle salaries, raises, and bonuses. I think that would help equalize things very quickly, and actually increase the economy instead of restraining it. (Note that this is not what a union does - pay still is individual based on performance).
The other crazy thing he says is that based on the data element:
a majority of Americans would prefer to earn $100,000 while everyone else earns $85,000, rather than earning $110,000 while everyone else earns $200,000.
he concludes:
that a nation may be collectively better off (using some abstract measure of well-being) with a smaller, more evenly divided pie than with a larger pie that's sliced less equitably
Didn't we just establish that people are unhappy unless they make more than their neighbor? Equivalence is not enough - just ask your neighbor! So the real result of this is that we should never publish who received the salary, so that you can assume that you are still the highest paid among your peers.
And that, I think are the key words: your peers. None of us aspire to being Trump - not with that hair. But we want to make more than our peers do - that's a common enough aspiration.
I found the book: In Search of Schrodinger's Cat - Quantam Physics And Reality, by John Gribbin. I do rather recommend it, if your interested in such things - it is very readable.
The first part of the experiment is very humorously portrayed here.
Ah, here is the description I needed - it describes how two slits can be used to check for collapsed states, though you need to read between the lines a little.
My understanding of QM comes from a book with Schrodinger's cat on the cover, written towards the common man as it were. It said that pratically every problem in quantum mechanics can be rewritten as a variation on the classic experiment: you run electrons through a diffraction grating (or 2 slots, which behave as a diffraction grating). As you would expect, you see the wave like behaviour of the electrons and so the time-integrated flux of electrons varies in a pretty pattern. You then decrease the electron flux to where only one electron goes through at a time - but the pattern stays there! Even though there are not any other electrons to cause the inteference pattern! Trying to get to the bottom of this, you put a sensor that detects the electrons as they pass one of the slots - but then the pattern instantly goes away.
So to me, that means that you can use a diffraction grating as a sort of quantum state collapse detector.
Reading on Wikipedia, it seems that they key to not allowing communication is to not allow duplication of quantum state - if that is true (which seems unlikely, given the following), then there is a simple answer. Entangle one quadrillion electrons. At a later time, the receiving person starts checking Z spin or whatever. He will get random directions until the transmitting person (in one fell swoop) checks the spin of all quadrillion electrons. Now the spin direction shows a bias, which can be detected (this is streching my understanding, but I'm not sure where I am wrong here).
Just curious as to the exact nature of the limitation.
OK, how about this (well, some variation on this):
We take a billion envelopes, each with their "gray" paper and send them out. Then, each second we take an envelope and send it through a grating (um, the postage equivalent of a grating), and observe the result. If the paper is black or white, we see no difraction pattern. If the paper was "gray", we eventually see a diffraction pattern in the ouput. We have then sent a message FTL - that the other party has collapsed the wave function of all of his remaining particles.
In the QM I know, you can tell if an electron's wave function has collapsed if you send it through a grating (though this is a destructive test). Why can't something like that work? Isn't there an equivalent to a diffraction grating for electron spin?
Thanks for pointing out a vehicle that proves my case.
No problem - but you still need to consider the cost. The reason the armour works so well is because it is %$^%*% $*#! %#$% @#$% (censored by DOD), which is incredibly expensive.
Of course, it would only triple the cost or so. Probably only increase per ticket cost by 20% or so, but the problem is that Airbus wouldn't do it, Southwest would buy Airbus, and Boeing would go out of business. The only way to really do it would be to have complex, insane regulations that dictate the required safety factors.
And then someone would bypass the added security after a few minutes thought.
If an M rating of available "cash" of 1.5T to 10T, and yet traded stocks value in the 45T, doesn't there seem to be a disconnect?
I found a better site that may have better answers for you btw. The total physical cash is M0, is about $700B.
In answer to your question about why isn't there a disconnect, think about this: There are more than 100 million households in America. I'm going to state without much evidence that the average value of these is more than $20,000 - I hope no one wants to argue that! That gives a total value of $2T - while there is only $700B in cash available in the US to buy those houses.
All I can really say beyond that is that value is different than cash. Cash has a value. Other things have value. Value is not cash. Cash is a useless thing arbitrarily given value so that exchanges can be made more easily. (BTW, the US dollar is backed by the "full faith" of the US government - so they are supposedly on the hook for it. The reason the Fed is actually in charge instead of the US government is that it turns out that trusting the government with your money is a bad idea - go figure).
Where will the minimum 30T in cash come from if all the stocks were to be
Stock is not cash - stock is a contract that gives you a split of ownership, mainly of future revenues. So the worst case crash is every stock goes bankrupt - when a company goes bankrupt, all the assets are sold and the cash goes to pay off debts. Due to the definition of bankruptcy, at that point there is no money/revenue left to pay shareholders, so the stock has zero value. So this would never be a cash-crunch situation.
we have a system which allows artificial inflation of value based upon artificial numbers
OK, so lets say that I have a company worth $50B, and 1 billion shares of stock (thus a share price of $50). I then print 1 billion more shares of stock, and give them to my friends. Besides the shareholder lawsuit, the immediate effect is that the price per share drops to $25. The value of the company did not change - just the number of shares (this is, of course, illegal in most situations I can think of). An alternative is that (from the same starting position) I sold the shares for $50 each (remember that the shares are owned by the corporation when created). I now have a company worth $100B (the original $50B plus the new $50B I just raised) with 2 billion shares, which gives a net price of $50 per share. This is how companies get funded before they show a profit.
So the obvious follow-on question is why does the company have a value of $50B? Isn't that just made up? The answer is no: the value of a stock is the discounted value of all future cash flows (profits) of the percentage ownership of the corporation that the stock represents. Discounting is done for two factors - one is probability of the profit, the other is time. If you want to mess around with calculations, a typical discount rate for a company is 15% per year - you take what they will make next year, discount it by 15%, the year after that by 1.15^2, and so on. The challenge is that you're predicting profits - which is hard. So often people just take the profits per share and multiply it by an industry standard multiple - say 25 times. If you work through the math, you can show that this assumes that the companies growth rate will be 4% less than the discount rate applied - so it really is the same thing, just grossly simplified.
So why do company stock values increase? Because the profits of the company increase over time. So basically, what this is saying is that a growing company has their stock price go up, while a company that just holds it's own has a flat stock price - because the cash you paid for it exactly covered its value, and its value is not changing. (You would expect dividends from this type of stock - note that Microsoft just converted to this type to a certain extent)
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As such China can require you to follow their laws without giving a fuck about what laws the US has.
Any US company is going to not sign a contract without some stipulation about following US laws. FYI, most international contracts have a clause that says it will be interpretted in New York - no matter where the companies are based.
Go figure.
Especially since the companies all have contracts with China now. If they decided to stop providing service, they are hit with penalty clauses - not to mention the black eye that breaking a contract would give them.
But all contracts have a "separability clause" that says that anything in the contract that violates the law is automatically declared void without effecting the rest of the contract. So the contract payments et al remain in effect, while the agreement to be evil goes away.
Ingenious, really.
I have a rule: "Doing something that you know won't work is never the right thing." That is my primary beef with liberals, in fact. If the stuff they proposed had a result that even maintained the status quo, it would be wonderful. The problem is that they "do the right thing," and make things far worse because "doing the right thing" was not realistic.
If you know that giving your starving brother money will result in him buying drugs instead of food, it is immoral to give him money. Come up with a different plan.
In a CMOS-like technology, you want overall capacitance as small as possible - because you have to charge and discharge that capacitor once per cycle. A first order approximation of power used is 0.5*Capacitance*(voltage squared). A first order approximation of the speed of the device is voltage*current/capacitance (where current is an exponential function of voltage). This means that from a circuit perspective, capacitance is the root of all evil (it both slows you down and uses up power).
When you look at it from inside the device, things change. Transistors work by having the gate-channel capacitor charge up and discharge. You need a certain amount of capacitance for it to work. An easier way to look at it might be to consider the electric fields instead of capacitance. A high K dielectric concentrates the fields in the channel instead of inside the gate oxide. This way, the fields are applied where they are useful (the channel) instead of where they are unneeded (the gate oxide). Obviously, this is somewhat of a simplification, but hopefully you get the gist of it - the capacitance is necessary inside the device, and by using a high-K dielectric you can concentrate that capacitance where you need it.
No, that will not work - they will find a way around it.
How about this - all government workers are only allowed to use cash investments - no stocks.
That might motivate them to keep the economy in line. BTW, this is pretty much what the Federal Reserve does to there employees...
In addition to what others have said, please consider this:
1. There is a set amount of total gold in the world.
2. Once all that gold is in circulation, the total possible cash is a set value.
3. The economy grows (as in, more computers per capita, more employees, whatever).
Therefore:
4. You now have to give everyone in the entire economy yearly salary cuts in order to allow for the expansion.
5. Anyone the has more money than they need can now just sit on it and it gets more valuable each year.
Is that the world you want to live in?
Further, reality is that not all the gold in the world has been mined. So instead of having a psuedo-government body regulate the economy using monetary policy, you have random "gold strikes" creating large, random fluctuations in currency. Great job, there.
So let me get this straight - you lived on an active volcanoe, but what you were worried about was the geothermal plants piping.
Priorities need a little work there, mate.
In addition to your comments, if something is more expensive it probably consumed lots of resources to create. So anything that costs you more than just buying fuel/electricity is almost certainly net harmful to the environment.
The economy works quite well - it is a good way to tell what you should do. Its main failings in this are externalities - but they do not amount to $500K. The most I've ever heard of is doubling the price of oil takes care of externalities.
There is always the angle of "that is not a legal purpose for a corporation, so you don't have a corporation, so you have no protection."
it is plainly an impossibility to maintain
No,no - I gave the obvious way out. Everyone should lie about their salary! That way, everyone thinks that they are making the most money and is happy!
I totally agree - being happy with what you have is the way to go.
Of course, whats funny is that those who really believe that do better than those who don't - if nothing else they are less likely to go into debt...
I agree with you, but to turn it around in a crazy twist its also wrong at the other end - if you have $100B in the bank, you no longer want to make yourself richer. The only way you can become happier is to raise others up, so that people will stop working on how to make more food (because that work will be done), and will start working on how to make rich people happier - because you created a market of rich people!
(Of course, this only makes sense if you remember that since economics is not a zero sum game you can make others rich without adversely effected your own wealth).
Another aspect of this is that the commonly (mis)reported metric is that the top 1% have x% of the wealth of the country. First, we should be looking at income, not wealth - wealth is merely a measure of by how much your income exceeds your expenditures, integrated over time. You can accumulate vast wealth merely by saving half of your money, passing it to your kids, and having them do the same.
But that aside, when you look at income disparity closely - you can easily see that it is an emergent characteristic of having a poisson-like income distribution. As far as I can tell, the entire increase in this metric can be attributed to population growth - as you have a larger population, the outliers get further away from the mean.
We know this intuitively - noone is surprised that the tallest person in the world is from China, not the US. They simply have a larger base from which to pull random samples. As an economy has a larger base (population), you see the same effect - the richest get richer. We would also see the mirroring effect, the poorest getting poorer, except for government and social programs fighting to prevent that.
I'm not saying that this is good or bad - just that people need to realize that the reason for this is statistics, not really greed. So the solution (if any) needs to take that into consideration.
Yes - but surely everyone in Switzerland is a banker! How could you be more homogenous!
I don't think anybody would suggest that paying a banker a lot of money will suddenly cause someone to become a street robber.
In fact (though I really doubt it is true of the US), I'm certain the opposite is true - if their are lots of robbers and murderers, someone will require an obscene salary to stay there and be a banker...
How much of a raise would you require to move to an area of the city where gang warfare is commonplace?
Interestingly, what you describe is exactly how the US is set up... how it's supposed to work.
But in reality, when I lost the use of my legs several years ago and couldn't hold a job, my welfare claim was denied - I survived by doing odd jobs and living in a cheap part of the country. Now that I have climbed up in society (which is due in a large part to my struggles in overcoming the obstacles I faced), I pay over a third of my income to the welfare lottery. Only people that the government chooses win that lottery - certain races, born in the right area, etc.
Having government services (like health care) help, I'm sure - but in the US, you can still get health care without any money, and I would be the one to know about that. My point is that, at least in my experience in the US, the poor get better (or at least more consistently) treated by private citizens and companies than by the government.
So make sure you know what you are talking about - I'm sure Sweden doesn't have these problems, but having a government system in placed does not mean there is no problem.
It is not an entirely zero-sum game, but it is true that the more wealth the richest have, the less the rest of us have.
I agree with everything you say, except for this statement. We do not have a zero-sum game, not even close! The way society works is that value is created by people typically working together, and then that value is haggled over to see who keeps what. Capitalism means the society gets the most (because in 50 years whatever you create becomes a commodity with very little profit in it), but the rest is divided amongst the people that had a hand in creating it - either developing it, funding it, or managing it.
The real problem is that you have "developing it" people negotiating their share with "managing it" people who are hired because of their ability to negotiate! That is the real inequality. For example, in general I am against a minimum wage - but once unemployment is low enough, setting a minimum wage is merely the government negotiating on behalf of the worst negotiators, the poor.
The reason I think this is important is that if you believe in a zero sum game, then you pull down the rich through taxes, and give it away to the poor. We know for an absolute fact that this damages the economy. If you understand that it is not zero sum, then you can use minimum wage laws to raise the poor instead of lowering the rich.
Personally, I would like to see laws passed that require employers to allow employees to hire negotiators to handle salaries, raises, and bonuses. I think that would help equalize things very quickly, and actually increase the economy instead of restraining it. (Note that this is not what a union does - pay still is individual based on performance).
The other crazy thing he says is that based on the data element:
a majority of Americans would prefer to earn $100,000 while everyone else earns $85,000, rather than earning $110,000 while everyone else earns $200,000.
he concludes:
that a nation may be collectively better off (using some abstract measure of well-being) with a smaller, more evenly divided pie than with a larger pie that's sliced less equitably
Didn't we just establish that people are unhappy unless they make more than their neighbor? Equivalence is not enough - just ask your neighbor! So the real result of this is that we should never publish who received the salary, so that you can assume that you are still the highest paid among your peers.
And that, I think are the key words: your peers. None of us aspire to being Trump - not with that hair. But we want to make more than our peers do - that's a common enough aspiration.
I found the book: In Search of Schrodinger's Cat - Quantam Physics And Reality, by John Gribbin. I do rather recommend it, if your interested in such things - it is very readable.
The first part of the experiment is very humorously portrayed here.
Ah, here is the description I needed - it describes how two slits can be used to check for collapsed states, though you need to read between the lines a little.
My understanding of QM comes from a book with Schrodinger's cat on the cover, written towards the common man as it were. It said that pratically every problem in quantum mechanics can be rewritten as a variation on the classic experiment: you run electrons through a diffraction grating (or 2 slots, which behave as a diffraction grating). As you would expect, you see the wave like behaviour of the electrons and so the time-integrated flux of electrons varies in a pretty pattern. You then decrease the electron flux to where only one electron goes through at a time - but the pattern stays there! Even though there are not any other electrons to cause the inteference pattern! Trying to get to the bottom of this, you put a sensor that detects the electrons as they pass one of the slots - but then the pattern instantly goes away.
So to me, that means that you can use a diffraction grating as a sort of quantum state collapse detector.
Reading on Wikipedia, it seems that they key to not allowing communication is to not allow duplication of quantum state - if that is true (which seems unlikely, given the following), then there is a simple answer. Entangle one quadrillion electrons. At a later time, the receiving person starts checking Z spin or whatever. He will get random directions until the transmitting person (in one fell swoop) checks the spin of all quadrillion electrons. Now the spin direction shows a bias, which can be detected (this is streching my understanding, but I'm not sure where I am wrong here).
Just curious as to the exact nature of the limitation.
Which makes me suspect you misunderstand something.
Yeah, the old if it would be that nice it doesn't match reality axiom. But why does it fail?
OK, how about this (well, some variation on this):
We take a billion envelopes, each with their "gray" paper and send them out. Then, each second we take an envelope and send it through a grating (um, the postage equivalent of a grating), and observe the result. If the paper is black or white, we see no difraction pattern. If the paper was "gray", we eventually see a diffraction pattern in the ouput. We have then sent a message FTL - that the other party has collapsed the wave function of all of his remaining particles.
In the QM I know, you can tell if an electron's wave function has collapsed if you send it through a grating (though this is a destructive test). Why can't something like that work? Isn't there an equivalent to a diffraction grating for electron spin?
Thanks for pointing out a vehicle that proves my case.
No problem - but you still need to consider the cost. The reason the armour works so well is because it is %$^%*% $*#! %#$% @#$% (censored by DOD), which is incredibly expensive.
Of course, it would only triple the cost or so. Probably only increase per ticket cost by 20% or so, but the problem is that Airbus wouldn't do it, Southwest would buy Airbus, and Boeing would go out of business. The only way to really do it would be to have complex, insane regulations that dictate the required safety factors.
And then someone would bypass the added security after a few minutes thought.
Oh well!
Well, it would take off - it would just only carry about one sixth the people. See Air Force One.
If an M rating of available "cash" of 1.5T to 10T, and yet traded stocks value in the 45T, doesn't there seem to be a disconnect?
I found a better site that may have better answers for you btw. The total physical cash is M0, is about $700B.
In answer to your question about why isn't there a disconnect, think about this: There are more than 100 million households in America. I'm going to state without much evidence that the average value of these is more than $20,000 - I hope no one wants to argue that! That gives a total value of $2T - while there is only $700B in cash available in the US to buy those houses.
All I can really say beyond that is that value is different than cash. Cash has a value. Other things have value. Value is not cash. Cash is a useless thing arbitrarily given value so that exchanges can be made more easily. (BTW, the US dollar is backed by the "full faith" of the US government - so they are supposedly on the hook for it. The reason the Fed is actually in charge instead of the US government is that it turns out that trusting the government with your money is a bad idea - go figure).
Where will the minimum 30T in cash come from if all the stocks were to be
Stock is not cash - stock is a contract that gives you a split of ownership, mainly of future revenues. So the worst case crash is every stock goes bankrupt - when a company goes bankrupt, all the assets are sold and the cash goes to pay off debts. Due to the definition of bankruptcy, at that point there is no money/revenue left to pay shareholders, so the stock has zero value. So this would never be a cash-crunch situation.
we have a system which allows artificial inflation of value based upon artificial numbers
OK, so lets say that I have a company worth $50B, and 1 billion shares of stock (thus a share price of $50). I then print 1 billion more shares of stock, and give them to my friends. Besides the shareholder lawsuit, the immediate effect is that the price per share drops to $25. The value of the company did not change - just the number of shares (this is, of course, illegal in most situations I can think of). An alternative is that (from the same starting position) I sold the shares for $50 each (remember that the shares are owned by the corporation when created). I now have a company worth $100B (the original $50B plus the new $50B I just raised) with 2 billion shares, which gives a net price of $50 per share. This is how companies get funded before they show a profit.
So the obvious follow-on question is why does the company have a value of $50B? Isn't that just made up? The answer is no: the value of a stock is the discounted value of all future cash flows (profits) of the percentage ownership of the corporation that the stock represents. Discounting is done for two factors - one is probability of the profit, the other is time. If you want to mess around with calculations, a typical discount rate for a company is 15% per year - you take what they will make next year, discount it by 15%, the year after that by 1.15^2, and so on. The challenge is that you're predicting profits - which is hard. So often people just take the profits per share and multiply it by an industry standard multiple - say 25 times. If you work through the math, you can show that this assumes that the companies growth rate will be 4% less than the discount rate applied - so it really is the same thing, just grossly simplified.
So why do company stock values increase? Because the profits of the company increase over time. So basically, what this is saying is that a growing company has their stock price go up, while a company that just holds it's own has a flat stock price - because the cash you paid for it exactly covered its value, and its value is not changing. (You would expect dividends from this type of stock - note that Microsoft just converted to this type to a certain extent)
You say you'