4 ms·
https://wtfhappenedin1971.com/ https://wtfhappenedin1971.com/ + globalization. Money creation favors people closer to the the printer. People that can take a l
by dpc_pw 6y ago
https://wtfhappenedin1971.com/ https://wtfhappenedin1971.com/ + globalization.
Money creation favors people closer to the the printer. People that can take a loan at 2% - which are generally wealthy people already. In the meantime working class has to compete with cheaper labor from poorer countries, while the capital owning class is pocketing the difference and enjoys cheaper goods.
Before capital owners had to pay a decent wage to workers in USA. The products made in US were more expensive, but the workers were compensated well so generally could afford it.
Now manufactured goods are cheaper, so people can still afford TVs and phones, but their purchasing power is lower in respect to things like services, housing.
This BTW. benefits software engineers that can plug themselves into high margin, low-labor operating capital, enjoy higher wages and rather easily join the capital class themselves.
Fundamentally labor increases profits linearly and capital increases profits exponentially. Without something to bridge the gap, exponential function will always eventually overtake the linear one. This happened many times before, and unfortunately the bridging was usually very destructive (wars & revolutions).
- polishdude20 6y agoAnd usually the bridging was not that the linear graph became an exponential one. The wars and revolutions caused a down fall in the exponential graph to bring it back to the same point the linear graphs were at. Equality by destruction.
- rayiner 6y agoExcept financial capital isn’t getting a greater share of GDP than it used to: http://blogs.wsj.com/economics/2015/03/26/thomas-piketty-says-labors-share-of-income-is-declining-but-is-it http://blogs.wsj.com/economics/2015/03/26/thomas-piketty-say.... The decline in labor share of income has come entirely from increased income from land and rents. https://www.vox.com/2015/4/1/8320937/this-26-year-old-grad-student-didnt-really-debunk-piketty-but-what-he https://www.vox.com/2015/4/1/8320937/this-26-year-old-grad-s... > Rognlie finds that when you account for depreciation properly, the capital share's increase has been entirely about housing. The part that you’re forgetting is that capital accumulates, returns to capital go down. There is a ton of capital sloshing around the economy right now looking for marginal returns.
- heavenlyblue 6y ago> The part that you’re forgetting is that capital accumulates, returns to capital go down. How does that help labour?
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- dpc_pw 6y ago> The decline in labor share of income has come entirely from increased income from land and rents. Housing is capital. > The part that you’re forgetting is that capital accumulates, returns to capital go down. Still, it accumulates. > There is a ton of capital sloshing around the economy right now looking for marginal returns. That's true. I actually keep thinking about the nature of this a lot, since it's very interesting.