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Money is not wealth. Money is an IOU for future wealth at an unclear price. You should spend your money on wealth, or give it to someone who will. If you save
by lupire 4y ago
Money is not wealth. Money is an IOU for future wealth at an unclear price.
You should spend your money on wealth, or give it to someone who will.
If you save your money and don't spend it, that creates inflation because it isn't stimulating production of wealth.
- mush_room 4y agoBut isn't keeping your money providing information to the economy? And conversely, forcing it to be spent as investment generating malinvestment, investment in frivolous activity? I'm just thinking out loud...
- raincom 4y agoSavings don't cause inflation at all. Imagine adding $100K to every one's bank account in the US, and make sure that these accounts are frozen for 30 years; this doesn't increase aggregate demand at all.
- scottiebarnes 4y agoFractional reserve banking allows a bank to take deposits and create loans up to some ratio, thus increasing money supply in the economy.
- raincom 4y agoLoans create deposits, this whole fractional reserve banking is nonsense taught in many schools.
- FrontierPsych 4y agoI've never heard of this before. A substantial net worth is known as wealthy. Net worth is defined as the current value of one's assets less liabilities. Having a billion dollars in one's bank account and zero liabilities is wealthy, unless you are defining wealthy some other way. Are you talking about wealth as a a nation, as opposed to individual wealth? Please explain.