Deriving the Dividend Discount Model

State that every stock must eventually pay a dividend or a liquidating distribution, record the Ponzi-scheme argument against a never-paying claim, and use Microsoft's first dividend in 2003 as the example.

Define $P_t$ (ex-dividend), $D_t$, $\mathsf{E}_t$ and $r_t$, note that dividends are never negative, and write the price as the discounted sum of expected dividends.

Record that the subscript on $r_{t+k}$ reflects a term structure of risky rates that shifts daily, and list the two sources of uncertainty in equities: cash flows and discount rates.