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Debt Worldwide Hits Record $86k per Person

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Re: Debt Worldwide Hits Record $86k per Person

#171

Post by anoncoward111 »

toasterlovin wrote: post #161
dpiers wrote: post #138

Earlier quoted context omitted.

To be fair, he directed people to a >500 page book on the subject as a good introduction to some of these ideas. Do you expect him to effectively summarize a massive text in a single HN comment?

Is three sentences asking too much?

I feel this way every time someone recommends a study or a book to me. If you can't summarize it for a 5 year old, then you are either lazy or don't understand it yourself.

For example, instead of telling me to read a 500 page book, you can say "the Big Bang is this really crazy but suprisingly plausible theory that our universe just suddenly exploded from nothing into this really hot and dense and chaotic realm, and now everything is expanding and cooling down and getting farther apart but also clumping together because of gravity. Check it out!"

Becuase at least then you can say "oh wow, why is it clumping together? how do we know gravity is a thing?"

Re: Debt Worldwide Hits Record $86k per Person

#172

Post by jazzyjackson »

FartyMcFarter wrote: post #158
kiliantics wrote: post #143

Earlier quoted context omitted.

The answers are very complex. In the book, Graeber shows that debt is as much a cultural/social norm as any other abstract, social construct we've invented throughout history. What debt meant in early Buddhist Nepal or Sumeria or aboriginal Australia, and what it means in modern western economies is completely tied in with governmental/religious/familial etc. structures that existed in the given time. He goes into gr…

The book, page 3: > and ask her to contemplate the justice of insisting that the lenders be repaid, not by the dictator, or even by his cronies, but by literally taking food from the mouths of hungry children. I'm still willing to give this book a chance, but it's not a good look when the third page already contains an emotionally manipulative and gross misuse of "literally".

I forgive the author for mixing some emotion into it -- he's trying to write a book about debt that will appeal to a general audience. Like the sibling said, it's still quite rigorous in its citations.

Re: Debt Worldwide Hits Record $86k per Person

#173

Post by spectrum1234 »

cecilpl2 wrote: post #136
jondubois wrote: post #77

Earlier quoted context omitted.

My understanding is that reserve banks create money out of thin air and then 'loan' it to governments. Then governments use the money to pay for public projects. A lot of the money ends up going to large corporations through significant government contracts, grants and subsidies. When a government takes a loan from the reserve bank and puts it into circulation by giving the money to corporations to pay for public pro…

The idea is that the public projects increase everyone's wealth by a greater amount than the interest on the debt. If you take money out of the equation and just consider that we have a large pool of labor to make use of, government's purpose in spending on projects is to allocate some of that labor towards long-term goals that no company would involve itself in as the pure profit potential is too risky, distant, or…

This might be true. However it's fact that poor people lose the most from inflation. Which is better?

Re: Debt Worldwide Hits Record $86k per Person

#174

Post by jazzyjackson »

jondubois wrote: post #77
wufufufu wrote: post #5

I'm ignorant on this, but to me there are two kinds of debt. 1) Personal debt, like I took out a car loan and I can get the car repossessed or the loan sold to debt collectors. 2) Debt that exists just to create more money i.e. the IMF or Fed Reserve decide to have an expansionary monetary policy and they lend from... what exactly? The purpose is to just control inflation. I'm guessing this is the second kind of debt…

My understanding is that reserve banks create money out of thin air and then 'loan' it to governments. Then governments use the money to pay for public projects. A lot of the money ends up going to large corporations through significant government contracts, grants and subsidies. When a government takes a loan from the reserve bank and puts it into circulation by giving the money to corporations to pay for public pro…

Reserve banks create money out of debt.

They give a loan to someone, which means someone owes them 10,000 dollars. Now they can trade that 10,000$ worth of debt to someone else. You could say "out of thin air", but its really "out of social expectations that you pay your debt eventually"

Re: Debt Worldwide Hits Record $86k per Person

#175

Post by insaneirish »

ams6110 wrote: post #89
rukittenme wrote: post #25

Earlier quoted context omitted.

Assets = Liabilities + Equity. In other words, $350k home = $300k mortgage + $50k in equity. You still have debt. Its just that the debt was exchanged for something. Its the same equation for credit card debt. No one takes on debt without receiving something in return.

Well people do take on debt for things that are quickly worth nothing. For example, you buy groceries with a credit card. You eat them; they are gone. But you still have the debt. Or you buy a car. It quickly loses value, but you still have the debt based on the original purchase. The formula still holds, but the "equity" part is negative, which leads many people to conclude that bankruptcy is a better option than pa…

> Or you buy a car. It quickly loses value, but you still have the debt based on the original purchase.

Aside from perhaps the first year of owning a financed car, it is worth more than remaining principal on the loan for the majority of the loan's duration.

Re: Debt Worldwide Hits Record $86k per Person

#176

Post by spookylukey »

XorNot wrote: post #126
audunw wrote: post #53

Earlier quoted context omitted.

> 1) Personal debt, like I took out a car loan and I can get the car repossessed or the loan sold to debt collectors. 2) Debt that exists just to create more money i.e. the IMF or Fed Reserve decide to have an expansionary monetary policy and they lend from... what exactly? As far as I know, these two are the same. In a fractional reserve banking system, when you borrow money from the bank for a car or a house, that…

The money isn't created from "nothing" - it's definitely real money from real people's savings accounts. The difference is that on a large enough scale, you can make a $1 of real savings circulate as though it were $1.50 or (probably a lot more) of circulating currency and there's huge benefits to doing that (when it's backed by real productivity). The source of things like the 2008 collapse was the dark side of that…

"real money from real people's savings accounts" is not how it works. See this book - https://www.amazon.co.uk/Where-Does-Money-Come-Monetary/dp/1...

Banks do indeed make money "from nothing". If you get a loan of $1000 from a bank, they just add $1000 to your current account, and write down in another account that you owe them $1000. They don't have to "get" this money from somewhere.

This is all as it should be. Say I can make tables, and you want one, but don't have anything to give me in exchange. We can agree that you now owe me $100, say. You can write me an IOU and sign it. Suppose you are trustworthy enough that an IOU from you is considered acceptable as payment. I can now use your IOU as money - we have just "created" $100 money from nowhere (or, $100 debt, same thing).

Re: Debt Worldwide Hits Record $86k per Person

#177

Post by jacobolus »

anoncoward111 wrote: post #171
toasterlovin wrote: post #161

Earlier quoted context omitted.

Is three sentences asking too much?

I feel this way every time someone recommends a study or a book to me. If you can't summarize it for a 5 year old, then you are either lazy or don't understand it yourself. For example, instead of telling me to read a 500 page book, you can say "the Big Bang is this really crazy but suprisingly plausible theory that our universe just suddenly exploded from nothing into this really hot and dense and chaotic realm, and…

The two-sentence summary is ”Cultures around the world (historical and current) have an incredible variety and richness of traditions/practices related to debt. Debt is of central importance in every human society, predates and provides the conceptual foundation for economic exchange and property rights and many other cultural practices/institutions, and the culture-specific details are fascinating to read about.”

Re: Debt Worldwide Hits Record $86k per Person

#180

Post by kristopolous »

anoncoward111 wrote: post #171
toasterlovin wrote: post #161

Earlier quoted context omitted.

Is three sentences asking too much?

I feel this way every time someone recommends a study or a book to me. If you can't summarize it for a 5 year old, then you are either lazy or don't understand it yourself. For example, instead of telling me to read a 500 page book, you can say "the Big Bang is this really crazy but suprisingly plausible theory that our universe just suddenly exploded from nothing into this really hot and dense and chaotic realm, and…

Explain the Riemann hypothesis to me, including the contexts and the current work, without using technical language, to a general audience, in three sentences or less. What about the Japanese language? The history of Israeli-Palestine relations maybe?

Some things are complicated and take 200 pages. There's nothing more to it.

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