5 ms·

More generally, it’s a problem with confusing a thing with the symbol of that thing. You can’t make people richer by printing money and just handing it out, tho

by gaius 9y ago

More generally, it’s a problem with confusing a thing with the symbol of that thing. You can’t make people richer by printing money and just handing it out, tho’ that doesn’t stop governments trying it (quantitative easing being the latest example). No mere coincidence that the same governments think they can educate people by printing and handing out degree certificates.

AnthonyMouse 9y ago
> You can’t make people richer by printing money and just handing it out, tho’ that doesn’t stop governments trying it (quantitative easing being the latest example). That actually does work pretty well, because it causes people to spend money. If you had none before and the government prints some and gives it to you, now you have some and can spend it. If you had some before and you know the government is going to be printing more, you want to spend it before the inflation reduces its value. As long as the things people are stimulated to buy are economically productive, it increases real wealth. The thing you have to be careful with is combining it with policies that cause people to spend the money on unproductive things. See housing bubble.
- UncleEntity 9y ago
  I used that argument during my counterfeiting trial, didn't go over too well until I started talking about broken windows...
  - thaumasiotes 9y ago
    Counterfeiting is one way of creating money and is generally unpopular. But making loans is a more mainstream way of accomplishing the same thing, and is in fact often considered to promote growth.
    - skookumchuck 9y ago
      Loans don't make people wealthier. The loans are backed by collateral, and have to be paid back. It is not at all the same thing as counterfeiting.
      - notfromhere 9y ago
        Loads generate lots of wealth if they're used effectively, and great at creating problems if used irresponsibly.
      - opwieurposiu 9y ago
        We use a fractional reserve banking system. Currently the reserve ratio is 10% for large banks. Therefore when you get a loan, 90% of the money you get from the bank the bank conjured from thin air. Loans are backed by 90% nothing.
        skookumchuck 9y ago
        Loans are not made to people who do not have collateral. That's what backs them.
        thaumasiotes 9y ago
        Do you by any chance have a credit card? Furthermore, while there are economic models in which loans are collateralized by goods of value exceeding the amount of the loan, modern American loans are generally not that way.
        skookumchuck 9y ago
        Yes, I do. And my assets will be seized by the credit card company via legal proceedings if I refuse to pay.
        thaumasiotes 9y ago
        You've got an odd focus on loan recovery. Issuing a loan creates money where there was no money before. Paying back that loan in the normal way is neutral, preserving the money that was created. Defaulting on the loan and having value recovered, in whole, in part, or not at all, from your property, destroys money.
TheOtherHobbes 9y ago
The whole point of the SA article is that you can make people richer by printing money and handing it out. It's absolutely clear about this. Printing money and handing it out is the best possible strategy if you want a vibrant, inventive culture. Conversely rationing access is self-defeating. You get a few individuals with giga-wealth and a lot of friction everywhere else, which throws sand in the wheels of future wealth creation.
- skookumchuck 9y ago
  No, you can't. There's no free lunch. Printing money makes the person with the new banknotes richer, but everyone else holding banknotes poorer. I.e. it's zero-sum. > if you want a vibrant, inventive culture Nonsense.
- DrScump 9y ago
  Printing money and handing it out is the best possible strategy if you want a vibrant, inventive culture. ... like present-day Venezuela?
smt88 9y ago
> "No mere coincidence that the same governments think they can educate people by printing and handing out degree certificates." However much disdain you have for college, it's not even close to the same as printing money. Decent, accredited institutions are still mind-expanding. I think you're also making a different argument. The argument OP and others are making is that education doesn't create wealth. You seem to be arguing that education doesn't create educated people.
- gaius 9y ago
  However much disdain you have for college I’m in the UK where the previous government had an ideological urge to get 50% of school-leavers into university and the only way it could do that was massive dilution. The Russell Group are still quality but the gap between them and the ex-poly degree mills is vast. Attending one of those indeed is not really an education despite the certification.
cortesoft 9y ago
It is a modern day cargo cult. https://en.wikipedia.org/wiki/Cargo_cult https://en.wikipedia.org/wiki/Cargo_cult

by gaius 9y ago

AnthonyMouse 9y ago

> You can’t make people richer by printing money and just handing it out, tho’ that doesn’t stop governments trying it (quantitative easing being the latest example). That actually does work pretty well, because it causes people to spend money. If you had none before and the government prints some and gives it to you, now you have some and can spend it. If you had some before and you know the government is going to be printing more, you want to spend it before the inflation reduces its value. As long as the things people are stimulated to buy are economically productive, it increases real wealth. The thing you have to be careful with is combining it with policies that cause people to spend the money on unproductive things. See housing bubble.

UncleEntity 9y ago
I used that argument during my counterfeiting trial, didn't go over too well until I started talking about broken windows...
- thaumasiotes 9y ago
  Counterfeiting is one way of creating money and is generally unpopular. But making loans is a more mainstream way of accomplishing the same thing, and is in fact often considered to promote growth.
  - skookumchuck 9y ago
    Loans don't make people wealthier. The loans are backed by collateral, and have to be paid back. It is not at all the same thing as counterfeiting.
    - notfromhere 9y ago
      Loads generate lots of wealth if they're used effectively, and great at creating problems if used irresponsibly.
    - opwieurposiu 9y ago
      We use a fractional reserve banking system. Currently the reserve ratio is 10% for large banks. Therefore when you get a loan, 90% of the money you get from the bank the bank conjured from thin air. Loans are backed by 90% nothing.
      - skookumchuck 9y ago
        Loans are not made to people who do not have collateral. That's what backs them.
        thaumasiotes 9y ago
        Do you by any chance have a credit card? Furthermore, while there are economic models in which loans are collateralized by goods of value exceeding the amount of the loan, modern American loans are generally not that way.
        skookumchuck 9y ago
        Yes, I do. And my assets will be seized by the credit card company via legal proceedings if I refuse to pay.
        thaumasiotes 9y ago
        You've got an odd focus on loan recovery. Issuing a loan creates money where there was no money before. Paying back that loan in the normal way is neutral, preserving the money that was created. Defaulting on the loan and having value recovered, in whole, in part, or not at all, from your property, destroys money.

TheOtherHobbes 9y ago

The whole point of the SA article is that you can make people richer by printing money and handing it out. It's absolutely clear about this. Printing money and handing it out is the best possible strategy if you want a vibrant, inventive culture. Conversely rationing access is self-defeating. You get a few individuals with giga-wealth and a lot of friction everywhere else, which throws sand in the wheels of future wealth creation.

skookumchuck 9y ago
No, you can't. There's no free lunch. Printing money makes the person with the new banknotes richer, but everyone else holding banknotes poorer. I.e. it's zero-sum. > if you want a vibrant, inventive culture Nonsense.
DrScump 9y ago
Printing money and handing it out is the best possible strategy if you want a vibrant, inventive culture. ... like present-day Venezuela?

smt88 9y ago

> "No mere coincidence that the same governments think they can educate people by printing and handing out degree certificates." However much disdain you have for college, it's not even close to the same as printing money. Decent, accredited institutions are still mind-expanding. I think you're also making a different argument. The argument OP and others are making is that education doesn't create wealth. You seem to be arguing that education doesn't create educated people.

gaius 9y ago
However much disdain you have for college I’m in the UK where the previous government had an ideological urge to get 50% of school-leavers into university and the only way it could do that was massive dilution. The Russell Group are still quality but the gap between them and the ex-poly degree mills is vast. Attending one of those indeed is not really an education despite the certification.

cortesoft 9y ago

It is a modern day cargo cult. https://en.wikipedia.org/wiki/Cargo_cult https://en.wikipedia.org/wiki/Cargo_cult