Having your money in stocks is having it in the economy. Buying a stock is loaning your money to other companies who use it to get stuff done, which requires hiring people and paying them.

Okay, you claim that companies will use cash to hire new employees. Well, let's look at a real case. The recent bolus of cash from the tax bill: how much of that went for new hiring, vs paybacks to stock holders or bonuses/raises for CEOs? I'm not an economist but my understanding is that it is a mixed report, many of the companies have NOT helped their workers, though a few have. Relative to the long-term debt-busting nature of the recent bill, it seems this is not a fair recompense for the pain that will come in the 5-year time frame, when middle-class tax cuts evaporate and we're left with just the tax cuts for the wealthy and corporations, yet no budget balancing.

Then the value just diffuses in the whole economy, ending up in investments in countless industries.

Instead you can keep it in stocks of companies you believe in, like startups and interesting moonshots.

It all ends up with the question - do you want the economy to decide where to focus the value (the diffusion) or do you want to decide yourself?

But if you have this amount of money in the first place, you are statistically in the better place to decide than the economy.

Putting 'statistically' in front of a fully subjective statement doesn't make it magically objective (or true).

I think you need a citation for that last point. This is the exact logic that got us the 2008 crash.

Perhaps, but also most of technological progress in recent centuries. It's a shame humans have a bias for negativity.

Certainly lots of technological progress has been made through exploitation but as we see automation taking more and more jobs, maybe we can end that cycle.

This is how progress in society is made. See a problem in the world and try to make it better. I don't think we need to have people working such degrading jobs to have technological progress, but you need it to have this many billionaires running around.

Yes, but stocks/bonds is basically giving money to companies so they can do useful stuff with them. So, they are still in the economy.

Well, the IPO is giving money to the company. The rest is speculation and dividend income.