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No it wouldn't, the movement of money is what drives an economy. Think of it this way: Alice has a dollar, gives it to person Bob for the food they grow, who g
by cowpig 4y ago
No it wouldn't, the movement of money is what drives an economy.
Think of it this way: Alice has a dollar, gives it to person Bob for the food they grow, who gives it to person Clarice for the clothes they make, who gives it to person A again for their art.
Each of Alice, Bob, and Clarice made a dollar and got something they wanted for that dollar.
If Alice instead decides to hoard the dollar, nobody makes any income and there is no economy.
- WalterBright 4y agoWhat happens under those circumstances is they barter. Barter is inefficient, but it's better than nothing.
- vouaobrasil 4y agoI didn't say if everyone locked their money away it would be good, just if billionaires did it. Alice and Bob would still buy clothes and food. 99% (or some high percentage) of the world would still be buying and selling stuff, just not billionaires under my thought experiment. There would still be a large movement of money.
- simne 4y ago> If Alice instead decides to hoard the dollar, nobody makes any income and there is no economy. It is not truth. Money is not just papers, or numbers, they are equivalents of products and services. And for real economy is totally normal, to hoard resources. Sure, ideal abstract hoarding is harmful, but in real life, exists hoarding with purpose, or some strategy involving hoarding. For example, one could hoard money in cash, enough to pay all his credits bodies. Other examples, in retail, typical shop have warehouse, with products for few days of trade - this is hoarding 100%; near all enterprises have warehouses, for at least few weeks of work; when products shipped via sea on cargo ship, these ships become moving warehouses. Now, imagine, hoarding disappear. From first look it have some pros - warehouses costs money and they added to costs of products and services. But if You'll look deep, You'll see, that products and services are not done instantly, exists some lag, from decision to make, to delivery. - Hoarding working as buffer, so we don't have to wait, we could buy products and services immediately, from warehouse. For enterprises things are even more significant, because they have huge costs cut, because buying large amount of some resources, for few months in advance (or even for few years), could be magnitudes cheaper, than jit buy small daily batches. Other important consideration, transportation is not 100% reliable. Exists possibility, that truck with resources (parts) will delay somewhere or just broken, and if You have not hoarded equivalent resources, Your enterprise will stop working, until these unlucky truck finish it's trip.
- simne 4y agoBTW, modern high-tech production is not instant. I've hear, TSMC spend up to few weeks to make modern chip. But they don't make one chip, they make wafer(S), with 100-1000 chips on each (depend on scale). So, TSMC make BATCHES of chips, and hoarding ready chips in warehouse, periodically shipping batches.