preview

Wealth And Power : Jordan Belfort, Bernard Madoff, And The Enron Company

Better Essays
This paper will be concentrated on the stock market and a few different people that gained tremendous wealth and power from it. Jordan Belfort, Bernard Madoff, and the Enron Company are prime examples of people who had acquired both wealth and power all coming through the stock market, but not exactly legally through the entirety of their careers. In multiple cases, unfortunate events and choices that took place in their lives led to the loss of a tremendous amount of money for a lot of people, which eventually led to their downfall. To start the paper we will focus on the stock market and how it works. Companies have two ways that they can obtain money, it can either sell stock or borrow money. Equity financing is when a company sell shares to a person who buys into the stock to gain part of ownership in the company. By selling the stock the company doesn’t have to pay interest to anyone and it is a lesser risk because you are splitting the risk with anyone who buys the stocks. If the company doesn’t end up being able to make a stable profit and is forced to close down, the original owners don’t lose all their money, but rather they lose a little bit of everyone’s money. The downside of selling stocks is you don’t fully own your company outright. Debt financing is if you decide to borrow money, you would have to take out a loan that would require you to pay interest as you progressively pay back the loan. This will put more risk into your hands as well, if the business
    Get Access