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I agree that's the theory. It used to be mostly true in the past, but given current valuations it does not look true at all. My worry is that we are not creati
by srean 5mo ago
I agree that's the theory. It used to be mostly true in the past, but given current valuations it does not look true at all.
My worry is that we are not creating enough new wealth but just distributing it lopsidedly.
- crossbody 5mo agoIs your worry based on vibes? Because statistics clearly show median real wealth growing rapidly: https://fred.stlouisfed.org/series/MEHOINUSA672N https://fred.stlouisfed.org/series/MEHOINUSA672N
- srean 5mo agoThat's money and not wealth and its a flow not stock and denominated in something that can depreciate, has it even been priced correctly ? I grant you that it is very hard to measure ownership of (wealth generating) assets, hidden behind legal obfuscations. Lorenz curve [0], GEI [1], Gini index of owned wealth generating assets would be the right thing to measure to see how understand one's share of the pie. But an enormous amount of records of such wealth is just hidden away, using laws that those very owners helped pass. [0] https://en.wikipedia.org/wiki/Lorenz_curve https://en.wikipedia.org/wiki/Lorenz_curve https://en.wikipedia.org/wiki/Generalized_entropy_index https://en.wikipedia.org/wiki/Generalized_entropy_index BTW I am willing to be convinced to adopt a different position if I see a well researched, credible Lorenz curve data that has tracked the shadow wealth to some degree of accurate approximation.
- crossbody 5mo agoMy bad, wrong chart (it's in real terms though) Here is net wealth increasing for all, let's celebrate: https://commons.wikimedia.org/wiki/File:1962-_Net_personal_wealth_-_average_in_percentile_ranges_-_logarithmic_scale_-_US.svg https://commons.wikimedia.org/wiki/File:1962-_Net_personal_w... My point is that the pie is growing and all are benefitting. Yes, rich may be getting more but not at the expense of poorer people as their wealth is increasing too. It's rather unfortunate but it seems that the pies grows fastest (and poor benefit from that growth too) when wealth is allowed to accumulate and yes that means more inequality but if all get better off, that's the price we have to pay for faster growth of total pie
- srean 5mo ago> My point is that the pie is growing and all are benefitting. This is the main point of contention though. Earlier generation middle class seems to have been larger and more financially secure. That would be our parent's generation. Of course not all of our parents would qualify.
- crossbody 5mo ago"seems" as based on vibes? Beware of nostalgia bias! It is true that middle class has been shrinking. What is often overlooked though ks that the majority of that middle class moved on to the upper class, so not bad at all and aligns with "growing pie"
- srean 5mo agoI accept the criticism in name but cannot invalidate a lived experience just because it has not been quantified accurately. > majority of that middle class moved on to the upper class Is this true in the US in inflation adjusted terms ? Can say that it is certainly reversed direction in my country.
- crossbody 5mo agoYes, people are getting wealthier in real terms, including the poor. Especially if you quantify it the right way: absolute consumption/expenditures, not relative % from median income (relative count will always show there are poor people even if they would appear insanely "rich" to a poor person from 100 years ago or from Afghanistan). On lived experience: my lived experience tells me the Earth is flat.
- srean 5mo ago> my lived experience tells me the Earth is flat. That ship has sailed, beyond the horizon. Hope you catch the reference.
- WalterBright 5mo ago> share of the pie Using words like that imprisons one into a certain perspective. Wealth creation is not "getting a share of the pie". Wealth is not an apple pie you slice up for your guests. If Picketty uses words like pie, share, transfer, concentration, etc., then his book is about as valueless as Das Kapital.
- srean 5mo agoFor what it's worth they are my words not Picekty's. It does not matter what it's called. The buck stops at the basket of goods and services I can buy. As long as this basket of goods and services is evaluated in inflation adjusted terms, it is pertinent to the discussion we are having.
- WalterBright 5mo ago> just distributing it lopsidedly Wealth is not being distributed. A laborer gets paid for the value he creates. There's no "distribution" going on (except by the government).
- srean 5mo ago> laborer gets paid for the value he creates Not true at all. Most labourers have nowhere close the pricing power necessary for this to be true. Information is obfuscated (legally of course) on purpose.
- WalterBright 5mo agoIf you are creating 10x the value you are paid, then plenty of other employers will offer you a raise. If you believe you are seriously underpaid, explain to your employer what value you are creating, and negotiate. If you start your own business, you'll find out exactly what you're worth.
- srean 5mo agoCome on, no way you can claim that. Let's take a Principal Engineer. A bad choice to make my case with, because among others, they do pay rather well. For a Principal Engineer, it is sort of a job requirement at that level to save or generate of the order of ~100 million dollars per year. An outsourced engineer sees nowhere near 1/10th that amount in his/her salary. For non software engineers it's much worse.
- WalterBright 5mo agoIf engineers produce 10x what they cost, there'd be a huge gold rush hiring them.
- srean 5mo agoI know, right ? But there isn't.