3 ms·
The other difference is capturing the surplus. Fixing the economy would be worth trillions, but how do you get your piece of it? It's much easier to capture the
by ianferrel 12y ago
The other difference is capturing the surplus. Fixing the economy would be worth trillions, but how do you get your piece of it? It's much easier to capture the surplus if you can insert yourself into the payment process for an already existing product.
- api 12y agoThat's why IMHO only governments can do those kinds of things right now. Only governments can make high-risk-high-payoff extremely broad and long-duration investments and then capture the upside through overall economy-wide growth (via taxation and other means). Nobody else can both afford the risk and capture some of the upside. It's possible that in the future someone will invent financial vehicles to make it possible to make those kinds of investments in the private sector, but it hasn't happened yet. Edit: in a sense there is already something, namely government bonds, ETFs, and long-term positions in currency markets. But those are too coarse-grained. What we need is some way for private investors to make private investments in things that are all of: high risk, high payoff, and broad payoff.