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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%

#861

Post by cudgy »

chii wrote: post #703
willcipriano wrote: post #628

Earlier quoted context omitted.

If the firm instead took out loans to pay out dividends would you feel differently? Now what if they did it every year at a increasing pace to the point where it's expected that firms take on debt to support ever larger dividends? That bubble pops eventually and is what I see happening with buybacks.

taking out debt to pay out dividends does not make any change to the capital structure of a company (i.e., the debt load increased, but the equity structure stayed the same). This basically means the company is losing that money paid out, and thus, the equity's price would drop by that equivelent amount, and then added a debt obligation (so an even more loss). This, no shareholder controlled board would ever authoriz…

“... taking out debt to pay out dividends does not make any change to the capital structure of a company (i.e., the debt load increased, but the equity structure stayed the same)”

Sorry, but this is nonsense. Increasing debt and giving the proceeds away to shareholders definitely alters the debt ratio of a company ... basic financial accounting concept.

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

#862

Post by curioushacking »

MrMan wrote: post #826
cromwellian wrote: post #652

Earlier quoted context omitted.

> Moderna created a vaccine in less than a day. Moderna benefited immensely from decades of publicly funded research as does most of Pharma, as well as direct aid from Emory University, NIAID, etc Look, if you believe the market works as the best mechanism for allocating goods and services, then you've also got to believe it won't work properly if prices are distorted, otherwise Garbage In, Garbage Out. If a firm is…

This is my view which is why I am vehemently anti libertarian and pro social democrat.

Agreed. It was a great post. I tend to think of my self as a "liberal-tarian." With the tenet being to set a goal for a standard of living and social / environment targets that benefits as many as possible, but anything beyond that get out of the way.

In this way I am for socialized health care, significantly stricter regulations or punitive measures regarding the environment. However for most other issues I would rather have a competitive market.

In the end I think some form of UBI may help us get there most efficiently. Ensure the environmental and health sustainability and give people a minimum amount of money to ensure they can reasonably sustain themselves, then let the market consider the rest.

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

#863

Post by aidenn0 »

jb775 wrote: post #517
bseidensticker wrote: post #499

Earlier quoted context omitted.

Inject the money somewhere else? UBI perhaps?

I mean as a personal investment hedge to protect against the artificial inflation

Lobby for the government to use use as an injection point?

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

#864

Post by lazerpants »

gwright wrote: post #491
lazerpants wrote: post #376

Earlier quoted context omitted.

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 rec…

This doesn't align with what I've read. For example: https://www.cato.org/blog/middle-class-shrinking-households-...

I'm not sure that the CATO study indicates that social mobility is high, just that a certain strata has grown? Here's a good paper on social mobility.

https://www.sciencedirect.com/science/article/pii/S002210311...

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

#866

Post by arrosenberg »

chii wrote: post #807
arrosenberg wrote: post #770

Earlier quoted context omitted.

Lots of ways. Directly, such as - https://www.wsj.com/articles/amazon-scooped-up-data-from-its... . It's a marketplace for laundering counterfeit and knockoff goods, harming the interests of legitimate businesses. Also indirectly by creating market pressures around logistics, pricing, SEO, and paid advertising that make it very difficult for a small operator to succeed against. A small business can struggle against a…

None of those are barriers. If you want to live on the amazon platform, you end up being a serf on their platform. That's a given. If you want to start a small business to compete with amazon, then of course their logistics, pricing and SEO is better than you. That's like saying that you want to start a garage car manufacturing plant, but you are out-competed by automanufacturer's investment in robotization and autom…

So are the barriers to entry obvious or nonexistent? Because you described both. Not only are they barriers, but vertically integrated monopolies have been illegal for a century. If erecting economic moats is the entire point of Amazon like you said, then it’s obvious they need to be broken up.

You really don’t think small, independent merchants are affected by Amazon’s 2 day delivery or taking back any return? That’s naive.

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

#867

Post by BenoitEssiambre »

RhodoGSA wrote: post #857
BenoitEssiambre wrote: post #642

Earlier quoted context omitted.

I've been wondering about that. I'm not sure if crypto coins without being stabilized by central banks are a powerful enough force to cause the type of havoc that gold did during the great depression. Then again, the potentially stronger network/memetic effects of cryptocoins, along with the amplification factor from markets being synchronized through instant all-encompassing global communications nowadays might make…

I was kinda following you and then the hitler thing came out of nowhere. Why exactly will bitcoin lead to the next hitler? Asking for a friend.

I understand that I kinda Godwin'd myself but if you read the wikipedia page on the Weimar Republic:

"The Great Depression, exacerbated by Brüning's policy of deflation, led to a surge in unemployment.[8] On 30 January 1933, Hindenburg appointed Adolf Hitler as Chancellor at the head of a coalition government. "

or

"In 1933, the American economist Irving Fisher developed the theory of debt deflation. He explained that a deflation causes a decline of profits, asset prices and a still greater decline in the net worth of businesses. Even healthy companies, therefore, may appear over-indebted and facing bankruptcy.[59] The consensus today is that Brüning's policies exacerbated the German economic crisis and the population's growing frustration with democracy, contributing enormously to the increase in support for Hitler's NSDAP."

https://en.wikipedia.org/wiki/Weimar_Republic#Br%C3%BCning's...

Now the above paragraph puts emphasis on businesses with debt but even non-indebted businesses can get caught in these currents if they are put in a position where it's more advantageous to hoard currency than to invest in maintaining or growing production.

It's a fairly low probability that cryptocoins could create this kind of disastrous Nash equilibrium without the involvement of a powerful central bank. However, when I see the fervor in parts of the cryptocurrency movement and the fact that businesses are starting to hoard large amounts, I wonder...

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

#868

Post by deelowe »

Godel_unicode wrote: post #572
deelowe wrote: post #547

Earlier quoted context omitted.

We're entering a potentially deflationary period. An aging demographic and technology create deflarionary pressure as people leave the workforce and technology improved efficiency. The Fed wants to create inflation. We know what's going to happen over time by observing germany and japan.

Germany has had negative inflation 1 year out of the last 30, and has hovered between 1 and 2 percent most years. Sounds good to me...?

Germany is an example of where their monetary policy has allowed them to keep inflation at the rate it's at. Japan is an example of where they have failed. Both are still good examples.

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

#869

Post by unishark »

parasubvert wrote: post #853
unishark wrote: post #776

Earlier quoted context omitted.

That's rather extreme. If he always predicts gloom and doom sometimes he will be right. Especially within the last 15 years. Wasn't he predicting the last financial crash for a couple years before it happened?

The boy who cried wolf was eventually correct too. A broken clock is right twice a day. Etc. Peter Schiff currently believes Bitcoin is going to collapse, that anyone who buys it is a fool and charlatan, that hyperinflation is around the corner, and the only solution is a return to the gold standard. Do you agree with this? I don’t like Bitcoin (too many grifters) but even I can admit it has value as a hedge asset ag…

> The boy who cried wolf was eventually correct too. A broken clock is right twice a day. Etc.

Yes. That's what I said.

You said he was consistently wrong for 15 years.

I don't know who to believe regarding gold and bitcoin, but it doesn't help me trust your opinion when you go overboard in your criticism of Schiff.

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

#870

Post by pnutjam »

artificialLimbs wrote: post #274
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…

> ...increase the tax on capital gains... How about proportionally? Stock trading apps now make it easy enough for Joe 6 pack to invest in the market at any income level. I could see a x% higher tax if you're buying 10,000 shares of Amazon, but it seems to me like putting < $1,000 in the market a month should be somewhat painless.

You know most American's can't cover a $400 unexpected bill. Try <$100, which is still a stretch for many.
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