Globalization
POSTED BY: deepgirl187
UPDATED: Tuesday, August 26, 2025 22:20
VIEWED: 9221
PAGE 4 of 15
Quote:
Originally posted by chrisisall:Quote:So if you're worth 100 billion, and inflation cuts it in half, you'd still be on top. Rich folk buy stuff to own, like real estate and companies.
Originally posted by Fletch2:
But this assumes that everyone who gains money by profit just sits and counts it like Scrooge McDuck. In reality if you just sit on money it becomes worthless (eroded by inflation.)Quote:
and when they buy stuff they put money back into the economy. They dont sit on it.Quote:
Economics is a science, staying at the top is a game.
Economics is not a science if it were you would have predictable results. It's an observation of the way that humans trade with one another to various degrees and at various levels. Every time you hear that economists are surprised (several times a year right?) that means that they guessed wrong --- or to be completely accurate the models they made didnt predict what real people decided to do.
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"Economics is ... an observation of the way that humans trade with one another to various degrees and at various levels." Structured by human-made laws. It's not a natural process - it's highly artificial.
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"Global warming - it's not just a fact, it's a choice."
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Quote:
Originally posted by rue:
He doesn't divulge what he does with his billions. But generally, ultra-wealthy spend lavishly on things like homes, second homes and third homes around the globe, on private jets, and on acquiring more money-making investments - like corporations - which further concetrates wealth.
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"Global warming - it's not just a fact, it's a choice."
Second home --- jobs for construction workers, appliance workers, furnishers, decorators carpenters, computer hardware people, electricity and phone company staff.
Third home -- ditto
Private jet? -- work at Boeing in Seatle, work at the GE engine plants.
New car? work for guys at Mercedes and Rolls.
All money going back into the economy. He has concentrated wealth yes, but when he converts wealth into comodities he pays to do it and that is someone wages and that does mean the money stays in the economy rather than "disappearing" as Sig suggests.
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Quote:
Originally posted by rue:
"Economics is ... an observation of the way that humans trade with one another to various degrees and at various levels." Structured by human-made laws. It's not a natural process - it's highly artificial.
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"Global warming - it's not just a fact, it's a choice."
Very true but being human not predictable. I like my science to have predicatable results. It isnt a science.
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Quote:Once they buy a villa or a yacht, they DO INDEED sit on it.
Originally posted by Fletch2:
and when they buy stuff they put money back into the economy. They dont sit on it.
Quote:Sounds just like regular old science to me...."Margarine is better for you...no wait; butter is better for you......................"
Economics is not a science if it were you would have predictable results. It's an observation of the way that humans trade with one another to various degrees and at various levels. Every time you hear that economists are surprised (several times a year right?) that means that they guessed wrong --- or to be completely accurate the models they made didnt predict what real people decided to do.
Chrisisall
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I agree. I know that people don't just sit on their cash (although BTW if they did inflation would NOT occur. In fact, their money would be more and more valuable with each passing day.) But that is why I said that it's important what happens to profits. As far as I can tell only a few things really happen: conspicuous consumption, investment, and speculation. (Run down the chain and it's going to be some combination of the three.) I'll eliminate conspicuous consumption and speculation as long-term "market-expanders" for the sake of simplicity. (but if you want we can get to that.)
So looking only at "investment"...
A business expands production when it sees an expanding market. But if the money supply stays the same the market will be stagnant, so a business will invest either to increase market share (improved product, acqusition/ consolidation) or to create higher profits through greater automation or lower pay rates. Neither one of those activites actually expands the market, and reduced pay rates and/or automation -while improving the bottom line in the short run- reduces the total amount of money that can be used to "buy stuff", and actively shrinks the market.
I know you'll prolly dispute my view of "what happens to profits" so if you'd like we can go thru a specific example of your choice.
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Always look upstream.
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Quote:
Originally posted by chrisisall:Quote:Once they buy a villa or a yacht, the DO INDEED sit on it.
Originally posted by Fletch2:
and when they buy stuff they put money back into the economy. They dont sit on it.Quote:
As do you in the house you own, so does the guy working the night shift at GM. Your point is? If your argument is taht all ownership is theft will you give back what you stole first?
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"All money going back into the economy."
It's not true that ALL the money goes back into the economy. The vast majority never does.
When Billy and Faisel and Warren spend for market goods the money does return, though poorly. (That spending tends not to multiply efficiently. For example, a person buying a private jet creates enough demand for one jet. A bunch of people flying on commercial jets create enough demand for a fleet - plus fleet maintenance, airports, regulations, airline companies, cabs and shuttles, travel agencies, on-line services ...)
But Billy and Faisel and Warren simply CAN'T spend ALL their money and return it to the economy, no matter how much gold dust they have added to the concrete in their driveway.
And that isn't their interest anyway. Their interest is in making MORE money. So they spend the vast majority of their money in acquiring more money making opportunities or in buying up the competition.
And that further concentrates wealth.
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"Global warming - it's not just a fact, it's a choice."
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Quote:Ummm, Fletch, I pay TAXES on my house, I don't have lawyers at Wolfram & Hart finding me loopholes and subsidies, and I can't write off my yacht and corporate jet as 'work-related' expenses.
Originally posted by Fletch2:
As do you in the house you own, so does the guy working the night shift at GM. Your point is?
Money magically makes having more money possible Chrisisall
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BTW Fletch, I highly recommend this book, available at Amazon.com, which I have and have read.
If you're looking for the voice of globalization experience AND analysis, this is the book for you.
http://www.amazon.com/Conflicting-National-Interests-Robbins-Lectures/
dp/0262072092
Global Trade and Conflicting National Interests (Lionel Robbins Lectures) co-authored by Ralph E Gomory and William J Baumol
Review
"The church of global free trade, which rules American politics with infallible pretensions, may have finally met its Martin Luther. An unlikely dissenter has come forward with a revised understanding of globalization that argues for thorough reformation. This man knows the global trading system from the inside because he is a respected veteran of multinational business. His ideas contain an explosive message: that what established authorities teach Americans about global trade is simply wrong--disastrously wrong for the United States."
-- William Greider, The Nation
Ralph E Gomory
http://en.wikipedia.org/wiki/Ralph_E._Gomory
Trained as a mathematician, Dr. Ralph E. Gomory first became a researcher and then an executive at IBM. Through his own research he created new areas of applied mathematics and later, both participated in and oversaw, the development of a broad range of critical new technologies. Many of the breakthroughs with which he was involved were fundamental to the advancement of the information revolution. Always more than just a researcher or a manager, he was known for his insatiable curiosity about the role of technological innovation in fostering a dynamic economy.
William J Baumol
http://www.nyu.edu/econ/dept/vitae/baumol.htm
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"Global warming - it's not just a fact, it's a choice."
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