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Creating more money steals value from everyone who has traded their work for money, and creating less of it adds value. So you are right, it doesn't create more

Creating more money steals value from everyone who has traded their work for money, and creating less of it adds value. So you are right, it doesn't create more or less resources or products, but it does change existing values of resources and labor.

epistasis 5y ago
As wealth grows through greater prosperity, if we do not increase the money supply to match this growth in wealth, we start to value prior labor far more than new labor. This is incredibly unfair to people who were simply born later than others, particularly since it's far easier to accumulate more money if one already has a good amount of wealth.
- merpnderp 5y ago
  Absolutely, which is why it is fair to err on the side of inflation instead of deflation when managing the money supply. But stability is more important than either inflation or deflation, as an erratic money supply increases uncertainty into the value of trades.
  - epistasis 5y ago
    Agreed, and IMHO inflation/deflation, for all the difficulty of measuring them, is probably the best way to know if the money supply is to high or low. This is also why I think Bitcoin rests on shaky foundations, and why I get tired of people who want a balanced federal government spending budget.
    - imtringued 5y ago
      Companies borrow to increase their net worth. If necessary they don't run balanced budgets. The point of the debt is that you end up better off with it than without. If the government were to optimize its net worth, then it would be pretty obvious that borrowing money to build transportation infrastructure and providing healthcare is "good" government spending and doing tax cuts or welfare is bad with debt. I don't know why but a lot of people pretend that governments are basically private households and all government spending is consumption.
      - lotsofpulp 5y ago
        > and providing healthcare is "good" government spending Not all of it though. Giving an 80+ year old dialysis or extending their life a few months or nursing home care requiring round the clock staffing is not going to net any returns for society. A third of healthcare spending was post 85 years of age, as of data 20 years ago. Surely it has skyrocketed since: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1361028/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1361028/ Imagine these resources put towards children. And fewer children will lead to even higher healthcare spending, since as far as I know, much of the tasks for elder care is not yet in the wheelhouse of automation, and it is highly undesirable work.
imtringued 5y ago
>Creating more money steals value from everyone who has traded their work for money, Let's say I have a car that is worth $30k. I create a car coupon that lets you buy the car for $0. I have created more money without "stealing value". Money is created by promising work in the future. Considering the huge demand for work in the future it should be pretty obvious why there is so much debt out there.
saint_abroad 5y ago
> Creating more money steals value from everyone who has traded their work for money, and creating less of it adds value. Conversely, creating more debt (as is with QE) adds value to everyone who has borrowed to invest. At some point though (usually through bankrupcy) this becomes inflationary. It is inflation that steals value from producers who trade work for money: remedied only by demanding more money this is a vicious cycle.

epistasis 5y ago

As wealth grows through greater prosperity, if we do not increase the money supply to match this growth in wealth, we start to value prior labor far more than new labor. This is incredibly unfair to people who were simply born later than others, particularly since it's far easier to accumulate more money if one already has a good amount of wealth.

merpnderp 5y ago
Absolutely, which is why it is fair to err on the side of inflation instead of deflation when managing the money supply. But stability is more important than either inflation or deflation, as an erratic money supply increases uncertainty into the value of trades.
- epistasis 5y ago
  Agreed, and IMHO inflation/deflation, for all the difficulty of measuring them, is probably the best way to know if the money supply is to high or low. This is also why I think Bitcoin rests on shaky foundations, and why I get tired of people who want a balanced federal government spending budget.
  - imtringued 5y ago
    Companies borrow to increase their net worth. If necessary they don't run balanced budgets. The point of the debt is that you end up better off with it than without. If the government were to optimize its net worth, then it would be pretty obvious that borrowing money to build transportation infrastructure and providing healthcare is "good" government spending and doing tax cuts or welfare is bad with debt. I don't know why but a lot of people pretend that governments are basically private households and all government spending is consumption.
    - lotsofpulp 5y ago
      > and providing healthcare is "good" government spending Not all of it though. Giving an 80+ year old dialysis or extending their life a few months or nursing home care requiring round the clock staffing is not going to net any returns for society. A third of healthcare spending was post 85 years of age, as of data 20 years ago. Surely it has skyrocketed since: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1361028/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1361028/ Imagine these resources put towards children. And fewer children will lead to even higher healthcare spending, since as far as I know, much of the tasks for elder care is not yet in the wheelhouse of automation, and it is highly undesirable work.

imtringued 5y ago

>Creating more money steals value from everyone who has traded their work for money, Let's say I have a car that is worth $30k. I create a car coupon that lets you buy the car for $0. I have created more money without "stealing value". Money is created by promising work in the future. Considering the huge demand for work in the future it should be pretty obvious why there is so much debt out there.

saint_abroad 5y ago

> Creating more money steals value from everyone who has traded their work for money, and creating less of it adds value. Conversely, creating more debt (as is with QE) adds value to everyone who has borrowed to invest. At some point though (usually through bankrupcy) this becomes inflationary. It is inflation that steals value from producers who trade work for money: remedied only by demanding more money this is a vicious cycle.