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Thread: "It’s Time for Major Wealth Redistribution — Yes, I Mean It."

  1. Top | #151
    Loony Running The Asylum ZiprHead's Avatar
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    Quote Originally Posted by Loren Pechtel View Post
    Quote Originally Posted by Elixir View Post
    Quote Originally Posted by Loren Pechtel View Post

    It would be 100% eaten up by inflation.
    No, not 100%. We are not on a gold standard, you know. It depends exactly WHERE all that money went. Giving billionaires money barely impacts inflation at all since they just hoard it or invest it (which would drive down the value of others' investments if they were to suddenly cash out). On the other end of the spectrum, giving it to homeless people would have an inflationary effect EVENTUALLY but not until it "trickled up" to the pockets of those paying payrolls...
    No, the inflation is immediate because you suddenly spiked the demand for goods without a corresponding increase in supply.
    So wouldn't there be a spike in employment growth to meet that new demand? Yes, there would be a short period of inflation until the added production meets the demand.
    When conservatives realize they cannot win democratically, they will not abandon conservatism. They will abandon democracy.

    Poverty exists not because we cannot feed the poor but because we can't satisfy the rich.

  2. Top | #152
    Elder Contributor DBT's Avatar
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    Not to mention a planned transition period to a new economic model in order to avoid excessive inflation. But can anyone see that happening? More likely pitchforks at midnight when the gulf between wealth and working class becomes untenable.

  3. Top | #153
    Loony Running The Asylum ZiprHead's Avatar
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    Quote Originally Posted by DBT View Post
    Not to mention a planned transition period to a new economic model in order to avoid excessive inflation. But can anyone see that happening? More likely pitchforks at midnight when the gulf between wealth and working class becomes untenable.
    Printing money willy nilly is what causes huge inflation. The stimulus is very expensive but that could be offset by just repealing the trump tax cut for the rich. It didn't do much as far as the entire nation goes anyway.
    When conservatives realize they cannot win democratically, they will not abandon conservatism. They will abandon democracy.

    Poverty exists not because we cannot feed the poor but because we can't satisfy the rich.

  4. Top | #154
    Fair dinkum thinkum bilby's Avatar
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    Quote Originally Posted by ZiprHead View Post
    Quote Originally Posted by DBT View Post
    Not to mention a planned transition period to a new economic model in order to avoid excessive inflation. But can anyone see that happening? More likely pitchforks at midnight when the gulf between wealth and working class becomes untenable.
    Printing money willy nilly is what causes huge inflation.
    It's really not.

    A collapse in production (eg Zimbabwe), or a diversion of the fruits of production out of the economy (eg Weimar Germany), and a loss of confidence in the currency (everywhere that's ever had hyperinflation) is the cause. Printing money willy nilly is the only response possible, until and unless you are ready to abandon the currency altogether in favour of a new one.
    The stimulus is very expensive but that could be offset by just repealing the trump tax cut for the rich. It didn't do much as far as the entire nation goes anyway.
    The stimulus isn't particularly expensive, and inflation is rather too low right now, so worrying about adding a little is pointless.

  5. Top | #155
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    I'm sure you guys all laugh at me behind my back and call me "The Great Nitpicker." But nitpicking is something I'm good at!

    Quote Originally Posted by bilby View Post
    And that there's so much wealth floating around today that a handful of wealthy people have more wealth than the entire Spanish economy in the C16th?
    Nitpick: To compare apples with apples, it may be best to adjust for population and productivity, i.e. use GDP in the denominator when making such comparisons. Wealth and income inequality are about the same today as in many ancient or medieval countries. Inequality is worse if measured not just within Spain, but by also considering Native Americans in the Spanish Empire, many of whom were reduced almost to slavery.

    With such adjustments, John D. Rockefeller a century ago should be considered wealthier than Mark Zuckerberg today. And the 14th-century Mansa Musa, Emperor of Mali, was even wealthier still.

    Quote Originally Posted by bilby View Post
    A collapse in production (eg Zimbabwe), or a diversion of the fruits of production out of the economy (eg Weimar Germany), and a loss of confidence in the currency (everywhere that's ever had hyperinflation) is the cause. Printing money willy nilly is the only response possible, until and unless you are ready to abandon the currency altogether in favour of a new one.

    ... inflation is rather too low right now, so worrying about adding a little is pointless.
    The Fed has been pumping up the money supply for more than a decade and much of the world is in a "debt bubble", but it doesn't seem to matter. There's little inflation, and the consensus seems to be that this novel economic environment can continue for decades more. Speaking of Mark Zuckerberg, much of today's production in America consists not of goods, but of services much of which have questionable value. Facebook alone has a market cap over 700 gigabucks. This is a sort of "bubble" that nobody is talking about: rent-collectors pimping services whose value to society may be negative.

    "Modern Monetary Theory" will continue working ... until it suddenly stops working. (Similarly Betelgeuse will probably continue as a red giant star for thousands or millions of years — but it might blow up tomorrow.) If/When inflation does raise its ugly head, will the Fed really respond as it did during the Carter-Reagan era by jacking up interest rates? The soaring value of Bitcoin is caused in part by big investors hedging against the dollar.

  6. Top | #156
    Fair dinkum thinkum bilby's Avatar
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    Quote Originally Posted by Swammerdami View Post
    I'm sure you guys all laugh at me behind my back and call me "The Great Nitpicker." But nitpicking is something I'm good at!

    Quote Originally Posted by bilby View Post
    And that there's so much wealth floating around today that a handful of wealthy people have more wealth than the entire Spanish economy in the C16th?
    Nitpick: To compare apples with apples, it may be best to adjust for population and productivity, i.e. use GDP in the denominator when making such comparisons. Wealth and income inequality are about the same today as in many ancient or medieval countries. Inequality is worse if measured not just within Spain, but by also considering Native Americans in the Spanish Empire, many of whom were reduced almost to slavery.

    With such adjustments, John D. Rockefeller a century ago should be considered wealthier than Mark Zuckerberg today. And the 14th-century Mansa Musa, Emperor of Mali, was even wealthier still.
    Sure, but Rockefeller couldn't buy a private jet, and Mansa Musa couldn't even buy a house with a flushing toilet.

    Zuck would think living like Rockerfeller a step down, and most people in today's developed world would baulk at living without indoor plumbing and soft toilet paper, for more than a few days.

  7. Top | #157
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    Quote Originally Posted by Swammerdami View Post
    Quote Originally Posted by Loren Pechtel View Post
    No, the inflation is immediate because you suddenly spiked the demand for goods without a corresponding increase in supply.
    What are we talking about? $20,000 for every man, woman and child? Say $50,000 per typical household? Isn't that a big one-time reward? Wouldn't,say, $5K per year for a decade (or payoffs timed by cohort) be more appropriate?

    And in the scenario, the government grabs most of Bezos' stock? The Treasury converts the stock to cash by selling it on the NYSE? Who exactly buys that stock anyway? And where did that buyer get his money from?

    I thoughbt that the big $6T jpeg was a "thought experiment" -- just quantifying the size of a wealth gap. Why are you assuming that a stupidly-designed transfer program was to be applied?
    Of course it's a thought experiment--I'm showing where the experiment leads.

  8. Top | #158
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    Quote Originally Posted by ZiprHead View Post
    Quote Originally Posted by Loren Pechtel View Post

    No, the inflation is immediate because you suddenly spiked the demand for goods without a corresponding increase in supply.
    So wouldn't there be a spike in employment growth to meet that new demand? Yes, there would be a short period of inflation until the added production meets the demand.
    We tried it--deliberate inflation to stimulate the economy. It was an abysmal failure.

    Inflation only stimulates the economy when it's unexpected--companies misinterpreting the signals.

  9. Top | #159
    Loony Running The Asylum ZiprHead's Avatar
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    Quote Originally Posted by Loren Pechtel View Post
    Quote Originally Posted by ZiprHead View Post
    Quote Originally Posted by Loren Pechtel View Post

    No, the inflation is immediate because you suddenly spiked the demand for goods without a corresponding increase in supply.
    So wouldn't there be a spike in employment growth to meet that new demand? Yes, there would be a short period of inflation until the added production meets the demand.
    We tried it--deliberate inflation to stimulate the economy. It was an abysmal failure.

    Inflation only stimulates the economy when it's unexpected--companies misinterpreting the signals.
    When Inflation Is Good

    When the economy is not running at capacity, meaning there is unused labor or resources, inflation theoretically helps increase production. More dollars translates to more spending, which equates to more aggregated demand. More demand, in turn, triggers more production to meet that demand.

    British economist John Maynard Keynes believed that some inflation was necessary to prevent the Paradox of Thrift. Which says, if consumer prices are allowed to fall consistently because the country is becoming too productive, consumers learn to hold off their purchases to wait for a better deal. The net effect of this paradox is to reduce aggregate demand, leading to less production, layoffs, and a faltering economy.2

    Inflation also makes it easier on debtors, who repay their loans with money that is less valuable than the money they borrowed. This encourages borrowing and lending, which again increases spending on all levels. Perhaps most important to the Federal Reserve is that the U.S. government is the largest debtor in the world, and inflation helps soften the blow of its massive debt.3

    Economists once believed an inverse relationship existed between inflation and unemployment, and that rising unemployment could be fought with increased inflation. This relationship was defined in the famous Phillips curve. The Phillips curve was largely discredited in the 1970s when the U.S. experienced stagflation. (For related reading, see "What Causes Inflation and Who Profits From it?")
    https://www.investopedia.com/ask/ans...od-economy.asp
    When conservatives realize they cannot win democratically, they will not abandon conservatism. They will abandon democracy.

    Poverty exists not because we cannot feed the poor but because we can't satisfy the rich.

  10. Top | #160
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    Quote Originally Posted by Jarhyn View Post
    Quote Originally Posted by Bomb#20 View Post
    Oh for the love of god! If they break "Steal Underpants" up into "Sneak into bedroom. Find underpants. Pick up underpants. Sneak out of bedroom.", the gnomes will have described more than three steps; but they still won't have explained how to get to "Profit".
    Dude, leveraging asymmetry is "profit", if you really want to get down to brass tacks.
    Dude, you appear to have become confused about which phases are from the DBT argument you're trying to defend versus which phases are from South Park. Nobody asked how to get from leveraging asymmetry to profit. The gnomes decline to explain how stealing underpants leads to profit; DBT declines to explain how leveraging asymmetry causes workers to be paid less than their market value. Pay attention.

    (Not that you care about market value any more than you care about distinguishing reality from a cartoon.)

    Quote Originally Posted by DBT View Post
    Quote Originally Posted by Bomb#20 View Post
    The Underpants Gnomes' business plan:



    Gnome: Phase 1 is power imbalance. Phase 3 is workers are paid less than their market value.

    Kyle: Sooo, what's phase 2?

    Gnome: Phase 1 is power imbalance.
    So you didn't understand what was said. Or even willing to. I'm not surprised. That, right from the beginning, a job applicant needs to impress the manager in order to get the job, their success being in the hands of the manager, whom they must please because the manager holds the cards and makes the decision, which the applicant/supplicant cannot alter, does not need explaining.
    Nobody said it does. Why do you keep repeatedly explaining the phase of your argument nobody asked you for an explanation of? Good grief, you're talking like a creationist, who just over and over says "If men evolved from monkeys why are there still monkeys?" and never explains how the evolution of men from monkeys is supposed to exterminate the rest of the monkeys. You keep pushing the same non sequitur over and over, apparently never noticing that you never get to your claimed conclusion. Please, reread the paragraph you just wrote, and point out where in your paragraph the phrase "market value" appears, because that's where the conclusion would have to be.

    Let's try this differently. If a worker is paid less than his market value, that's the same as his market value being more than he's paid. So tell us how an applicant's need to impress the manager implies that his market value is higher than what the manager offers to pay him. Who is the market, and how do you know he/she/it values the applicant more than the manager values him?

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