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America's 1% Has Taken $50T From the Bottom 90%

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Re: America's 1% Has Taken $50T From the Bottom 90%

#371

Post by brobdingnagians »

tylerhou wrote: post #227
tobmlt wrote: post #150

Earlier quoted context omitted.

Yep. The fed is an engine, whose purpose is to move wealth silently from the masses to the powerful monied few, via time-asymmetric inflation. (Mostly Inflation of assets presently) The resulting data looks like corporations have used their power to directly disenfranchise/disempower workers, and so the mass clamber for protective laws. More laws will be enacted by those in power. The time is certainly right for it.…

The Fed is stabilizing the price of the USD because of the coronavirus pandemic. If it were not printing money, then there would likely be a deflationary spiral that would cause a depression. That's one of the reasons why the Great Depression was so bad: the US was on the gold standard at the beginning. The US can't create gold out of thin air, so the USD started deflating, people stopped spending, and capital stoppe…

There are differences of opinion on what is the cause and the effect [1]. There were deeper reasons for the deflation and by cutting production and preventing deflation, it made it much more difficult for small businesses and individuals to buy food or continue business. That benefited large corporations at the expense of the smaller ones. The government taxed the poor, then subsidized farmers to stop producing, which made the food more expensive which further hobbled the poor.

The Fed benefits banks and the wealthy. Inflation and increasing money supply makes labor cheaper for businesses and hurts those on fixed salary or wage by decreasing the real value of wages over time.

[1] https://mises.org/library/how-fdr-made-depression-worse

Re: America's 1% Has Taken $50T From the Bottom 90%

#372

Post by tylerhou »

anchpop wrote: post #360
tylerhou wrote: post #335

Earlier quoted context omitted.

CEO bonuses, not always a good thing. Buybacks are not always good (because stock-compensated corporate managers sometimes abuse them to increase the stock price), but for airlines, buying stock was the right choice. You can read Matt Levine's argument, but basically: If airlines didn't spend money on buying back stock, they could have: 1. Invested it in growth. But if they had invested it in all the normal things an…

Can you link to Matt Levine's argument? (I googled a little but didn't see what you were talking about)

https://www.bloomberg.com/opinion/articles/2020-03-17/the-go...

Re: America's 1% Has Taken $50T From the Bottom 90%

#373

Post by StreamBright »

natenthe wrote: post #57

Correction: The Fed's policies have taken $50T of wealth from the Bottom 90%. When you bail out irresponsibly over-leveraged and nearly bankrupted banks and corporations, and pay for those bailouts with tax-payer money, you steal from the poor and give to the rich. Most importantly, when the Fed decides to print money ad nauseam, they create massive asset inflation, which steals from the poor and gives to the rich. T…

Somehow most of the time when there is something bad systematically happening in the US it is almost always associated with government legislation. In my opinion it is largely because of intention based policies as opposed to outcome based policies. We rarely investigate what was the outcome of a policy and just doubling down on failed ones.

Re: America's 1% Has Taken $50T From the Bottom 90%

#374

Post by ClumsyPilot »

renewiltord wrote: post #223
mindslight wrote: post #154

Earlier quoted context omitted.

Even with income remaining stagnant, the prices for goods and services should have been continually going down due to technology and outsourcing. Price optimization is the fundamental mechanic of any market! For example, when most manufacturing was moving to China the promise was that it would benefit consumers via lower prices. However the Fed's overt policy is to erase these gains by printing money via low interest…

The price for goods is dramatically down. You can buy a 70" flat panel display for $500 today. And there's a lot of pseudo-productivity here that is mostly just rising healthcare spending (without commensurate changes in outcomes) and land value. This sort of makes sense since these sectors have massive capture problems.

Oh cool, can you eat it?

How about 95% of economy: education, houses, food, heating, electricity, fuel? What about industrial goods: Bricks, steel?

But oh, you can now live in poverty unable to afford cancer treatment with a TV.

Re: America's 1% Has Taken $50T From the Bottom 90%

#375

Post by breatheoften »

afarrell wrote: post #312
tylerhou wrote: post #227

Earlier quoted context omitted.

The Fed is stabilizing the price of the USD because of the coronavirus pandemic. If it were not printing money, then there would likely be a deflationary spiral that would cause a depression. That's one of the reasons why the Great Depression was so bad: the US was on the gold standard at the beginning. The US can't create gold out of thin air, so the USD started deflating, people stopped spending, and capital stoppe…

Agreed. The problem is that the Fed only has the power to inject dollars at the top of the economy, yet sales taxes and the IRS drain dollars from a broad base of the economy. I think an MMO designer would suggest two options: A. Nerf the Fed, which would have the problems you note. B. A balancing mechanic -- Some more universally-accessable way to inject income at the base of the economy.

B. I've been contemplating a mechanism based on mandatory minimum paid vacation days per year - fed provides free access to the money, corps borrow it or whatever to earn some interest -- but corps must pay employees a minimum days off per year (a large amount -- like 1-2 months per year)

The value of currency and debt has diverged too far from quality of life concerns -- days off seem a direct way to inject quality of life capital into the system and, I think, could prove an investment able to unearth very new and effective social transformation capabilities ... as well as a new shared basis from which to renegotiate and rebalance our social contracts.

Re: America's 1% Has Taken $50T From the Bottom 90%

#376

Post by lazerpants »

salmonellaeater wrote: post #232

The framing in the article is ahistorical. The post-WW2 period was a period of exceptionally _low_ inequality. If you look back to just the 1800s there were swings in inequality comparable to the present day. We're now moving back to the historical baseline. There are some contributing factors to the shift in inequality, a major one being that labor is now oversupplied compared to the post-war period, and the competi…

I think the issue with inequality that bothers many people includes an extra feature, how difficult it is for someone to move between percentiles of wealth. If it were easy to join the top 10% in wealth via intelligence, grit, and hard-work, I doubt many would be bothered by even deeper inequality than the USA currently has. However, if it is both difficult to move up the wealth ladder and highly unequal, it is a recipe for social unrest.

Re: America's 1% Has Taken $50T From the Bottom 90%

#377

Post by chordalkeyboard »

Apocryphon wrote: post #344
chordalkeyboard wrote: post #330

Earlier quoted context omitted.

> Sure, and it is an opinion or value judgment supported by millennia of social contract even before Enlightenment era thinkers came up with the concept of the social contract. Yeah, so is slavery. So is monarchism. So is marital rape. > If you're going against one of the basic mechanisms or tools for how society works, you might as well label yourself an anarchist. Which is fine, plenty of mutualist ideologies exist…

> Yeah, so is slavery. So is monarchism. So is marital rape. So is property. So is language. So is symbolic thought. > I’ll identify myself as an anarchist for being opposed to violent coercion of resources if you will identify yourself as a criminal for being in support. Sound fair? Anarchism is an existing ideology with many school of thoughts within it. You seem to be an anarcho-capitalist, to be precise. I, of co…

> So is property. So is language. So is symbolic thought.

Language and symbolic thought are not opinions or value judgments.

> I, of course proudly admit to being a criminal (https://www.youtube.com/watch?v=EEXTt9OmJis&t=1m18s) insofar living in modern society makes criminals of us all, yourself included, even under duress.

I’m not convinced that it is meaningful to make that assertion. But this is fine, I’m an anarchist because I oppose coercion and you’re a criminal for supporting it.

> Because it's cheaper to provide social programs than to deal with rolling peasant revolts.

And so that makes it moral to suppress peasants with unjust taxation regimes?

> And indeed so. So are you then an anarcho-primitivist? Or anti-propertarian?

I decline to identify as a proponent of any belief system because of the harmful epistemological consequences of group identity.

Re: America's 1% Has Taken $50T From the Bottom 90%

#378

Post by icefrakker »

tylerhou wrote: post #357
ItsMonkk wrote: post #348

Earlier quoted context omitted.

This is an inaccurate narrative. The more wealth inequality there is in a nation, the less that increases in the money supply effect the economy. This is why we have no inflation with trillions injected. The rich simply store the money in assets like stocks and houses and it never touches consumption. The only thing that needed to happen to keep the economy afloat was the Congress passing their bills.

> The rich simply store the money in assets like stocks and houses and it never touches consumption. But these do affect consumption. 1) Stonks going up means that companies have more capital (through stock issuances and equity raises). Companies use this capital to buy things and pay workers, so the dollars end up recirculating through the economy just like if a regular person spent it. 2) Buying houses is consumpti…

Are people still pushing that trickle down nonsense? They pushed that idea because they think the masses are idiots and we ate it up because the masses are indeed idiots. As far as your point about housing: the supply demand nonsense you learned as a freshman in college is total garbage - the real world does not work like that. You live in a fantasy world where people can say things like "free markets work like so" without any embarrassment, but there never has been a free market in the existence of humanity and there never will be.

Re: America's 1% Has Taken $50T From the Bottom 90%

#379

Post by PragmaticPulp »

OscarCunningham wrote: post #296
natenthe wrote: post #57

Correction: The Fed's policies have taken $50T of wealth from the Bottom 90%. When you bail out irresponsibly over-leveraged and nearly bankrupted banks and corporations, and pay for those bailouts with tax-payer money, you steal from the poor and give to the rich. Most importantly, when the Fed decides to print money ad nauseam, they create massive asset inflation, which steals from the poor and gives to the rich. T…

Do you think the Fed should have not done this and allowed inflation to run below their 2% target (perhaps negative)? Or do you have an alternative suggestion for how to keep inflation steady without printing money?

The challenge is that the fed isn't the only factor that determines inflation. It also varies based on supply and demand factors, among other things.

Housing prices, college tuition, and medical care dominate inflation measures. All three of those categories have significant government influence well beyond the fed. If we stopped using federal funds to subsidize college and home loans, tuition prices and housing costs would magically stabilize in no time.

Trying to tame tuition or housing inflation from the fed won't work if the other parts of the government are going to great lengths to subsidize those areas.

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