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That means they're preserving it and reinvesting it so more wealth can be created. This is a good thing.
by smokeyj 10y ago
That means they're preserving it and reinvesting it so more wealth can be created. This is a good thing.
- stretchwithme 10y agoIf we consumed all of that nasty wealth, there'd be none to borrow to get a house or education. None for startups. People get rich by not consuming everything as soon as they get it. This is a great thing for everybody. And it's not just rich that accumulate. A person making minimum wage and just saving the same amount withheld by the US social security tax would have hundreds of thousands of dollars accumulated if they kept it in the stock market for their entire working career. I was curious about this a few years ago and put together this spreadsheet, using this tax rate, rate of return and minimum wage over a 40 year period. https://docs.google.com/spreadsheets/d/1RlSfkW-DKXAXtXKvZJR5avibx_DqZEXIZk-Wd9SpSIc/edit?usp=sharing https://docs.google.com/spreadsheets/d/1RlSfkW-DKXAXtXKvZJR5...
- chromatic 10y agoWhat's the marginal propensity to consume and the velocity of those dollars?