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Ah ok I see your angle now, but I think there's a critical flaw. Your investment into the general market is really only the amount of interest earned on deflat
by Enginerrrd 6y ago
Ah ok I see your angle now, but I think there's a critical flaw.
Your investment into the general market is really only the amount of interest earned on deflation of that amount.
Compare this with investing the whole amount into a local bakery. The utility difference is dramatic.
- centimeter 6y ago> Compare this with investing the whole amount into a local bakery. The utility difference is dramatic. I do not agree that the utility difference is dramatic. The utility difference is closely proportional to the difference on expected returns.
- splintercell 6y ago> Your investment into the general market is really only the amount of interest earned on deflation of that amount. Your investment is the whole amount which would have purchased the 3 components of production (land/labor/capital), because the price of all these goods have fallen, which have allowed other entrepreneurs to buy them for their own investment. What you're saying is like telling people who invest in index funds only that their investment is only the interest on the yearly return they get from the fund.