3 ms·

> Capital in motion and at a high velocity is generally good for everyone. Capital at rest serves very few and is very harmful to everyone else. This is danger

> Capital in motion and at a high velocity is generally good for everyone. Capital at rest serves very few and is very harmful to everyone else. This is dangerously wrong. No economist would tell you that a high velocity of money is an inherent good, or even that increasing the velocity of money is an unfettered good. Public infrastructure, mortgages, venture capital, small business loans - all of these are investments, and making it more expensive to hold capital will dry up access to money for these sorts of projects.

JumpCrisscross 9y ago
> No economist would tell you that a high velocity of money is an inherent good You may be confusing money and capital. Money velocity is almost always good. If someone buys infrastructure bonds and then those proceeds are spent on contractors to build infrastructure (who in turn pay suppliers and employees) you have lots of money moving with velocity.
- chimeracoder 9y ago
  > You may be confusing money and capital. Money velocity is almost always good. I am not confusing anything. Increasing the velocity of money is not always good. In fact, under some schools of thought, long-term increases in the velocity of money are neutral-to-slightly-bad. > If someone buys infrastructure bonds Increasing the expense of saving capital means increasing the expense of bonds, which decreases the incentive to buy them in the first place. > you have lots of money moving with velocity. Uh, no, the tail end of that process does describe consumption behavior, but this situation actually has very little to do with the velocity of money, since we haven't addressed the propensity to spend that money a second time within any finite timespan.
- FuriouslyAdrift 9y ago
  I think I'm the one that made the confusing statement to begin with. Your clarification is more in line with what I meant.
carlob 9y ago
Piketty argues we need a low worldwide universal capital tax. At the very least one of the advantages would be to have a census of wealth, just like we have for income.
- djrogers 9y ago
  Note the ‘worldwide’ here - otherwise you have capital leaving the country which decides to tax it.
FuriouslyAdrift 9y ago
The lower the efficiency of a system the higher employment and the more capital is spread around, making everyone better but making it very difficult to aggregate wealth. Public infrastructure is exactly that...public. It is isn't taxed. More money would be available for loans with higher velocity. Venture capital already has extremely high velocity...that's why it is even possible for extreme high risk investing to be profitable in the first place. Where the penalty would be applied to businesses, banks, investment firms sitting on CASH or near cash assets doing nothing. Put those assets to work or tax the hell out of it.

JumpCrisscross 9y ago

> No economist would tell you that a high velocity of money is an inherent good You may be confusing money and capital. Money velocity is almost always good. If someone buys infrastructure bonds and then those proceeds are spent on contractors to build infrastructure (who in turn pay suppliers and employees) you have lots of money moving with velocity.

chimeracoder 9y ago
> You may be confusing money and capital. Money velocity is almost always good. I am not confusing anything. Increasing the velocity of money is not always good. In fact, under some schools of thought, long-term increases in the velocity of money are neutral-to-slightly-bad. > If someone buys infrastructure bonds Increasing the expense of saving capital means increasing the expense of bonds, which decreases the incentive to buy them in the first place. > you have lots of money moving with velocity. Uh, no, the tail end of that process does describe consumption behavior, but this situation actually has very little to do with the velocity of money, since we haven't addressed the propensity to spend that money a second time within any finite timespan.
FuriouslyAdrift 9y ago
I think I'm the one that made the confusing statement to begin with. Your clarification is more in line with what I meant.

carlob 9y ago

Piketty argues we need a low worldwide universal capital tax. At the very least one of the advantages would be to have a census of wealth, just like we have for income.

djrogers 9y ago
Note the ‘worldwide’ here - otherwise you have capital leaving the country which decides to tax it.

FuriouslyAdrift 9y ago

The lower the efficiency of a system the higher employment and the more capital is spread around, making everyone better but making it very difficult to aggregate wealth. Public infrastructure is exactly that...public. It is isn't taxed. More money would be available for loans with higher velocity. Venture capital already has extremely high velocity...that's why it is even possible for extreme high risk investing to be profitable in the first place. Where the penalty would be applied to businesses, banks, investment firms sitting on CASH or near cash assets doing nothing. Put those assets to work or tax the hell out of it.