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"Didn't Norway just bought into the stock market via their pension fund? That is literally the opposite of investing it themselves." A pension fund is payment

"Didn't Norway just bought into the stock market via their pension fund? That is literally the opposite of investing it themselves." A pension fund is payment to a group of people over a period of time. Traditional investment from a government into a country comes in the form of building infrastructure and military. Dollars spent on infrastructure and the military will not pay yearly cash dividends. A factory can take it's payroll budget and "invest" it on machines, but it will not be able to pay it's employees, which defeats the purpose of a payroll budget. Norway has a yearly budget and it invests in traditional things like infrastructure and their military. This is what the GP means when they say that governments can make good investments. [1] [1] https://en.wikipedia.org/wiki/State_budget_of_Norway https://en.wikipedia.org/wiki/State_budget_of_Norway

flavius29663 5y ago
Doing a quick lookup over the budget of Norway, it seems like they invest directly about 4 billion USD each year (this is for year 2007, but it can't be be wildly different today). Compare that to the government letting the pension fund invest 1400 billions on the open market. https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Norway https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Nor... I would say even the government of Norway recognized that the free economy will do better with the money that they can (and how right they were!)
- nouveaux 5y ago
  I don't get it. Can you explain to me what the ROI would be if the pension fund invested their money into public infrastructure?
  - flavius29663 5y ago
    Not sure how to calculate ROI on infrastructure. There is a limited amount of infrastructure a country needs, once that is built the government can decide to keep pumping money into the economy (say state operated oil machinery factories, armament factories, furniture factories etc.) or they can do what the Norway government did and just dump the money in the stock market, letting the market decide what works and what doesn't.
    - nouveaux 5y ago
      So you're saying that we should take all the money the government spends and put it in stocks? What about infrastructure and public works? Schools? Research?

flavius29663 5y ago

Doing a quick lookup over the budget of Norway, it seems like they invest directly about 4 billion USD each year (this is for year 2007, but it can't be be wildly different today). Compare that to the government letting the pension fund invest 1400 billions on the open market. https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Norway https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Nor... I would say even the government of Norway recognized that the free economy will do better with the money that they can (and how right they were!)

nouveaux 5y ago
I don't get it. Can you explain to me what the ROI would be if the pension fund invested their money into public infrastructure?
- flavius29663 5y ago
  Not sure how to calculate ROI on infrastructure. There is a limited amount of infrastructure a country needs, once that is built the government can decide to keep pumping money into the economy (say state operated oil machinery factories, armament factories, furniture factories etc.) or they can do what the Norway government did and just dump the money in the stock market, letting the market decide what works and what doesn't.
  - nouveaux 5y ago
    So you're saying that we should take all the money the government spends and put it in stocks? What about infrastructure and public works? Schools? Research?