Thanks to the growth, productivity, resourcefulness, and innovation of corporations, capitalism creates wealth—a positive-sum game for its owners. Capitalism is a provider for wealth accumulation and the backbone of innovation due to financial investments. Unlike zero-sum games, where one person’s gain is another’s loss, the stock market grows because companies create real value through their innovations and productivity improvements.
- Related Note(s):
- This wealth accumulation works like compound interest—small returns multiply over time into significant wealth.
- Success requires long-term thinking, not chasing short-term gains: capitalism and index fund investing reward patient investors.
- When making investment decisions, remember you’re investing in this wealth-creation engine, not just buying stocks, funds, or bonds.
- The idea of increasing gains by reducing costs is simple and often overlooked.
- Source(s): The Little Book of Common Sense Investing by John C. Bogle, p. XIX
