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I won't be responding to follow ups to this conversation as it doesn't feel very fruitful but there's a couple things in your comment that just don't follow for

by lwb 7y ago

I won't be responding to follow ups to this conversation as it doesn't feel very fruitful but there's a couple things in your comment that just don't follow for me. How is an asset that holds its value a subsidy? How are poor people indirectly funding that subsidy by holding an asset that doesn't inflate? Really seems like you're projecting qualities onto something that just aren't there. Plus there are other factors in wealth inequality besides cash holdings -- wages (minimum or otherwise) that don't keep up with inflation being the most notable.

BenoitEssiambre 7y ago
>How is an asset that holds its value a subsidy If it is stabilized by a government to hold its value while marginal assets on the private markets only offers negative returns (adjusted for risk and liquidity), the government stabilized asset is effectively a forced subsidy. It's a subsidy to those who hold the subsidized asset from those who don't hold any (though long term it's a bit unpredictable who exactly ends up footing the bill, it depends on whether it happens through inflation or taxes or price distortions etc.). What is super destructive about this type of subsidy is that it displaces private investment. The world shifts from people owning real shit, such as factories, inventories, business infrastructure, machinery, houses, cars, etc. to collectively holding government manipulated tokens. While for an individual, holding the tokens is more advantageous, for the aggregate it's super destructive as it becomes a negative sum game. Tokens are just IOUs. They don't have intrinsic value. When everyone wealth is in the form of a promise that everyone else owes them something, no one really has anything. More here:https://medium.com/@b.essiambre/the-world-deserves-a-pay-raise-302f25efd82a?source=friends_link&sk=cb180b2cf186b263b6c6c70ad29bc36e https://medium.com/@b.essiambre/the-world-deserves-a-pay-rai...

by lwb 7y ago

BenoitEssiambre 7y ago

>How is an asset that holds its value a subsidy If it is stabilized by a government to hold its value while marginal assets on the private markets only offers negative returns (adjusted for risk and liquidity), the government stabilized asset is effectively a forced subsidy. It's a subsidy to those who hold the subsidized asset from those who don't hold any (though long term it's a bit unpredictable who exactly ends up footing the bill, it depends on whether it happens through inflation or taxes or price distortions etc.). What is super destructive about this type of subsidy is that it displaces private investment. The world shifts from people owning real shit, such as factories, inventories, business infrastructure, machinery, houses, cars, etc. to collectively holding government manipulated tokens. While for an individual, holding the tokens is more advantageous, for the aggregate it's super destructive as it becomes a negative sum game. Tokens are just IOUs. They don't have intrinsic value. When everyone wealth is in the form of a promise that everyone else owes them something, no one really has anything. More here:https://medium.com/@b.essiambre/the-world-deserves-a-pay-raise-302f25efd82a?source=friends_link&sk=cb180b2cf186b263b6c6c70ad29bc36e https://medium.com/@b.essiambre/the-world-deserves-a-pay-rai...