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My hypothesis is that people without significant real assets are all worse off since the money supply has been debased. Peter Thiel's book talks about "secrets"

by turnip1979 10y ago

My hypothesis is that people without significant real assets are all worse off since the money supply has been debased. Peter Thiel's book talks about "secrets" that are not really hidden but overlooked .. if he were to interview me and ask what I thought was an apparent secret, I'd say it was this. I'm not even sure what one can do if one accepts this .. borrow money and hoard real assets? If you don't have money to begin with, how do you get the loans? So yeah .. defn worse off.

justinlardinois 10y ago
I'm curious about what you're saying, but I'm a little confused by your terminology. Are you using "debased" here to refer to inflation? And could you elaborate on Thiel's definition of "secrets" and what exactly the "secret" here is?
dragonwriter 10y ago
> My hypothesis is that people without significant real assets are all worse off since the money supply has been debased. "Debased" in this context doesn't make any sense; it really only makes sense in commodity or representational currencies, not fiat money. If you mean "devalued", then you really should say that. But I'm not sure how the logic works, anyway, unless you assume that those without "real" assets also tend to have a constant and positive wealth of fiat currency, such that decline in fiat currency value has the same effect on their net wealth. I really think there is, at most, a coincidence or possibly common cause here rather than the causal link you suggeset, which I don't see any clear rationale or evidence for.
deleted 10y ago
[deleted]
Spooky23 10y ago
Whenever you have inflation, it's always good to have assets, either real property (they're not making more land) or durable goods.
toodlebunions 10y ago
The Federal Reserve would agree with part of your thesis, as zero interest rates and quantitative easing has caused significant asset inflation and those who are not asset holders have not benefited at all. Instead, many are now priced out of real estate, and have to pay high P/E valuations for stocks. Much higher risk to participate now.
fspear 10y ago
So what are the viable options for those of us without significant assets? This is a real issue for me at this stage as even though I am a relatively high income earner I have been completely priced out of the real estate market. Rent takes up most of my salary making saving up for a decent deposit really dificult (I live in Australia).
- notadoc 10y ago
  The argument I have often heard is that access to credit can be an equalizer. Obviously using credit is high risk at these asset price levels though, but a mortgage is how most average people get to participate in asset inflation.
- gohrt 10y ago
  Options from HN: Go to a coding bootcamp, accrue significant assets.
- antisthenes 10y ago
  Revolution?

justinlardinois 10y ago

I'm curious about what you're saying, but I'm a little confused by your terminology. Are you using "debased" here to refer to inflation? And could you elaborate on Thiel's definition of "secrets" and what exactly the "secret" here is?

dragonwriter 10y ago

> My hypothesis is that people without significant real assets are all worse off since the money supply has been debased. "Debased" in this context doesn't make any sense; it really only makes sense in commodity or representational currencies, not fiat money. If you mean "devalued", then you really should say that. But I'm not sure how the logic works, anyway, unless you assume that those without "real" assets also tend to have a constant and positive wealth of fiat currency, such that decline in fiat currency value has the same effect on their net wealth. I really think there is, at most, a coincidence or possibly common cause here rather than the causal link you suggeset, which I don't see any clear rationale or evidence for.

deleted 10y ago

[deleted]

Spooky23 10y ago

Whenever you have inflation, it's always good to have assets, either real property (they're not making more land) or durable goods.

toodlebunions 10y ago

The Federal Reserve would agree with part of your thesis, as zero interest rates and quantitative easing has caused significant asset inflation and those who are not asset holders have not benefited at all. Instead, many are now priced out of real estate, and have to pay high P/E valuations for stocks. Much higher risk to participate now.

fspear 10y ago

So what are the viable options for those of us without significant assets? This is a real issue for me at this stage as even though I am a relatively high income earner I have been completely priced out of the real estate market. Rent takes up most of my salary making saving up for a decent deposit really dificult (I live in Australia).

notadoc 10y ago
The argument I have often heard is that access to credit can be an equalizer. Obviously using credit is high risk at these asset price levels though, but a mortgage is how most average people get to participate in asset inflation.
gohrt 10y ago
Options from HN: Go to a coding bootcamp, accrue significant assets.
antisthenes 10y ago
Revolution?