This only occurs if future investors thinks the value will increase after they've put their money in. Rinse and repeat
Because of this, maintaining a steady profit is not enough to appease investors. The quarterly profit has to increase over time so that investors will believe the company is a good investment for them
This is one of the driving forces of capitalism which is ironic given the Tendency for the Rate of Profit to Fall
The rate of profit falling and the quest for increased profit amount is the reason for infinite growth.
Increases in productivity (mechanization, better procedures, development of productive forces, etc.) Come with a fixed cost of constant capital (means of production, managerial burdens/non-productive work, anything that isn't wages for workers basically). This drives down the prices of commodity and reduces the amount of surplus value a capitalist can extract from an individual worker and maintain that worker's social reproduction.
The only solution besides abolition of the profit motive to this contradiction of economies of scale is exponential growth. Maintenance of profits as the rate of profit falls requires massive booms in labor power which is why we've had exponential population growth, and on top of more workers, you also need to reduce the share of social product those workers receive (exploitation and war in the global south, and austerity at home).
Capitalists can also maintain profit amounts by cannibalizing/proletarianizing their own class. Reduction in the amount of capitalists competing for the surplus product of society means increasing profits for the "survivors". This is the inevitability of capitalist collapse and the necessity of socialism and eventually communism. The new social order arises when the old social order fails to reproduce itself, or when the revolutionary class created in the contradictions of the old world overthrows it (functionally the same thing).
The capitalist mode of production is not a mode of production really, it's a mode of control over social production, the natural state of which we would describe as socialism/communism.
Investor puts money in to buy shares
They hope the value of those shares will increase
This only occurs if future investors thinks the value will increase after they've put their money in. Rinse and repeat
Because of this, maintaining a steady profit is not enough to appease investors. The quarterly profit has to increase over time so that investors will believe the company is a good investment for them
This is one of the driving forces of capitalism which is ironic given the Tendency for the Rate of Profit to Fall
The rate of profit falling and the quest for increased profit amount is the reason for infinite growth.
Increases in productivity (mechanization, better procedures, development of productive forces, etc.) Come with a fixed cost of constant capital (means of production, managerial burdens/non-productive work, anything that isn't wages for workers basically). This drives down the prices of commodity and reduces the amount of surplus value a capitalist can extract from an individual worker and maintain that worker's social reproduction.
The only solution besides abolition of the profit motive to this contradiction of economies of scale is exponential growth. Maintenance of profits as the rate of profit falls requires massive booms in labor power which is why we've had exponential population growth, and on top of more workers, you also need to reduce the share of social product those workers receive (exploitation and war in the global south, and austerity at home).
Capitalists can also maintain profit amounts by cannibalizing/proletarianizing their own class. Reduction in the amount of capitalists competing for the surplus product of society means increasing profits for the "survivors". This is the inevitability of capitalist collapse and the necessity of socialism and eventually communism. The new social order arises when the old social order fails to reproduce itself, or when the revolutionary class created in the contradictions of the old world overthrows it (functionally the same thing).
The capitalist mode of production is not a mode of production really, it's a mode of control over social production, the natural state of which we would describe as socialism/communism.