6 ms·

Yes, that is a good thing. The bad part is that they aren't using the other 99.99..% of their wealth, essentially taking everyone else's labor and ending the cy

Yes, that is a good thing. The bad part is that they aren't using the other 99.99..% of their wealth, essentially taking everyone else's labor and ending the cycle of trade that would otherwise help keep an economy going. And that's not to mention broader macroeconomic issues which are more worthy of essays than HN comments.

jstanley 13y ago
They're not stuffing that money under their mattresses. The vast majority of this money is invested in other businesses in one way or another, whether directly in stocks and shares or indirectly through a bank.
- kenster07 13y ago
  Of course. But compared to actually spending money directly on goods that are produced by the average person, they may as well be stuffing it under their mattress.
EGreg 13y ago
Thanks to less than 100% reserve requirements on banks, the money the rich keep in American banks is theoretically reinvested through loans back to various enterprises. The problem arises when the banks don't lend the money and just sit on it... or when companies like Apple siton their huge cash reserves... To fix this we must boost aggregate DEMAND. Investors and banks give money to businesses when they see demand.
- kenster07 13y ago
  Boosting aggregate demand will not solve the unemployment issue when you consider that one person with automation can produce enough goods to satisfy the demand more than one person.
  - EGreg 13y ago
    Right - automation presents a big and growing challenge to the structure of the economy But redistributing money to people on the bottom to give them safety nets (and allow them to do things like re-educate themselves for some other career) as well as spend it back into the economy is a way to keep them from going completely bankrupt. When a company goes bankrupt, it's one thing. When a human does, it often results in starvation and homelessness.
- WalterBright 13y ago
  Apple has no cash reserves in cash. Even bank deposits are invested back into the economy.
  - EGreg 13y ago
    Right, the real issue is with the lenders. I would argue that giving money directly to the people so they can send price signals back into the economy -- via Basic Income or a Negative Tax -- is much more effective at increasing aggregate demand.
michalu 13y ago
99.99% where did you get the figure from? So you expect Gates to sell his shares in Microsoft, Bezos in Amazon and Musk in Tesla? Aren't they already using 100% of their money? What am I missing here?

jstanley 13y ago

They're not stuffing that money under their mattresses. The vast majority of this money is invested in other businesses in one way or another, whether directly in stocks and shares or indirectly through a bank.

kenster07 13y ago
Of course. But compared to actually spending money directly on goods that are produced by the average person, they may as well be stuffing it under their mattress.

EGreg 13y ago

Thanks to less than 100% reserve requirements on banks, the money the rich keep in American banks is theoretically reinvested through loans back to various enterprises. The problem arises when the banks don't lend the money and just sit on it... or when companies like Apple siton their huge cash reserves... To fix this we must boost aggregate DEMAND. Investors and banks give money to businesses when they see demand.

kenster07 13y ago
Boosting aggregate demand will not solve the unemployment issue when you consider that one person with automation can produce enough goods to satisfy the demand more than one person.
- EGreg 13y ago
  Right - automation presents a big and growing challenge to the structure of the economy But redistributing money to people on the bottom to give them safety nets (and allow them to do things like re-educate themselves for some other career) as well as spend it back into the economy is a way to keep them from going completely bankrupt. When a company goes bankrupt, it's one thing. When a human does, it often results in starvation and homelessness.
WalterBright 13y ago
Apple has no cash reserves in cash. Even bank deposits are invested back into the economy.
- EGreg 13y ago
  Right, the real issue is with the lenders. I would argue that giving money directly to the people so they can send price signals back into the economy -- via Basic Income or a Negative Tax -- is much more effective at increasing aggregate demand.

michalu 13y ago

99.99% where did you get the figure from? So you expect Gates to sell his shares in Microsoft, Bezos in Amazon and Musk in Tesla? Aren't they already using 100% of their money? What am I missing here?