4 ms·
The Author misunderstands as badly as the people he is trying to explain to, conflating wealth and market value. If you own an asset, that is your wealth, no ma
by adammarples 4y ago
The Author misunderstands as badly as the people he is trying to explain to, conflating wealth and market value. If you own an asset, that is your wealth, no matter what dollar price you can sell it for, just the asset itself. You can trade it, but in aggregate, the amount of money and assets in the world stay the same. That's why the only real wealth increases are in GDP, someone creating some new wealth which never existed before. Price is just an estimate about the future, how large the money stream your assets might entitle you to capture over its lifetime, and one that has constantly to be revised. Value is subjective.
- ir123 4y agoThe amount of money, wealth and assets absolutely don't remain the same.
- imtringued 4y agoA house is an asset, building more houses drops the value of existing houses but it doesn't destroy your house. The money supply also stays the same. It only goes up when you borrow money to buy or build a house and goes down as you pay off the mortgage.