>so it makes complete sense that people want to be as close to the money tap as possible to siphon from it This is known as the "Cantillon Effect"[0], and it a

>so it makes complete sense that people want to be as close to the money tap as possible to siphon from it This is known as the "Cantillon Effect"[0], and it also explains the concept of biflation[1]: if you're close to the money tap and there's a surge of money, you can profit from arbitrage before that money hits the larger economy and spreads out. The further away from the money tap you are, the less you're able to profit from changes in money supply. Everyone who isn't close to the money tap is on the losing end of this arbitrage opportunity. This creates perverse incentives for large well-connected business entities, typically centered around schemes involving juggling debt. >Who wants that hassle when you can just pretend being a business and keep on borrowing? Yep. Eventually every business model starts turning into some variation of a pump and dump scheme. We see this most prominently in crypto, but also in the traditional economy (stock buybacks, real estate speculation, startups running on VC fumes, etc.) When enough of the economy turns away from production to speculation, the entire thing falls over and implodes. We don't know the exact point when this happens, and it's probably impossible to model, but history tells us it eventually does happen. People like Michael Burry believe this implosion is imminent, but things keep getting patched at the last second and the machine keeps lurching along. Despite the fancy math and terminology, the stock market (and the larger financialized economy) is ultimately based on "vibes" and the vibes now are bad. Even the 2008 crash didn't put a stop to these speculation games. Nobody knows how long "we" can keep this up. It's like a slot machine with a bomb inside. The rich guys pulling the lever are getting most of the coins, and the rest of us will get mostly blast damage. [0] https://en.wikipedia.org/wiki/Richard_Cantillon https://en.wikipedia.org/wiki/Richard_Cantillon [1] https://www.investopedia.com/terms/b/biflation.asp https://www.investopedia.com/terms/b/biflation.asp