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20 year study of global wealth demolishes the myth of ‘trickle-down’

businessinsider.com

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Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#221

Post by ImprobableTruth »

romwell wrote: post #183
JackFr wrote: post #149

Earlier quoted context omitted.

> as the billionaire holds on to whatever financial product they bought forever as long as it appreciates faster than inflation. Another word for that is investment. Where do you think that money goes? You don’t earn returns on money that isn’t doing anything.

>Where do you think that money goes? Offshore. I think that money goes offshore. I even said it in the previous sentence, which you didn't quote. >Another word for that is investment. Well let's entertain the fantasy that the money doesn't flow away into offshore accounts for a second. So you're saying that investing is good? Then instead of giving money to rich people (e.g. by tax cuts), the government should do wha…

I'm curious as to what you even mean by "money goes offshore" and how does that cause it to appreciate?

And of course investing is good - how could you even argue against that? Businesses need funding. And yes, governments in fact do invest in both companies and private housing, I don't understand why you think this is some gotcha. It's just that on average governments tend to do worse at investing, so it's generally restricted to areas where the private market fails to provide.

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#222

Post by d--b »

The thing about trickle down is that even the water analogy is backwards!

It's combining many small streams that make up the big rivers... as in: give money to the lower classes, they will consume stuff and so the money will end up in the pockets of whoever produced the goods (usually large companies -> the sea?), and there the money will flow back up as income (clouds/rain?) and that will feed the small streams over again.

In that analogy, the wealthy act like a dam, not as a source, cause the wealthy can only consume so much...

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#223

Post by benreesman »

Anyone who knows with any sophistication how economics works isn’t telling: they’re pocketing the difference working at RenTec or Jump or whatever. A child knows that privatizing profits and socializing losses is only good for rich people, but a Nobel laureate can’t prove it.

So what we get is a bunch of “those who can’t, teach” social science economics. Greenspan in front of Congress talking about “flaws in conceptual frameworks” rather than “me and Summers shouldn’t have squished Brooksley Born like a fucking bug when she tried to institute some sanity in derivatives markets”. California and electricity. Repeal of Glass-Steagall. Top work guys.

Sometimes I think that HN will literally be the last place where temporarily embarrassed billionaires are pseudo-intellectualizing about pseudo-science economics when the tent-camp people under the 101 interchange finally head over to South Park and rig up a guillotine on that grassy bit.

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#224

Post by [deleted] »

naruvimama wrote: post #65

Speaking from a historical perspective. The East India company/ies pretty much won much of the world for Britain & Europe. Europe was neither wealthy nor technologically more advanced than India. But the Church with its christianising mission and doctrine of christian discovery allowed the pooling of resources. Concentration of wealth is important and the wealth did trickle down to other countries of Europe. A modern…

[deleted]

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#226

Post by Jensson »

fumar wrote: post #162
seibelj wrote: post #141

Earlier quoted context omitted.

A major difference now is the majority of those with vast wealth earned it themselves through creating new enterprises. The aristocrats of old received it through birth or politicking. The rich today are far more effective and organizationally superior considering it was those exact skills that made them their wealth.

Are you arguing that the wealth class today isn’t politicking to maintain power and wealth either to a corporation or themselves?

They do, but as we have seen in the past 30 years they often still fail to do that.

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#227

Post by Wolfenstein98k »

JKCalhoun wrote: post #194
Wolfenstein98k wrote: post #144

What an amazing headline. "The rich are taking most of the gains for themselves" No, stock in certain valuable companies rose a lot when their inherent value did (especially in relative terms), and stockholders thus hold a lot more wealth on paper.

How much did the wealth of the minimum wage workers increase (on paper or otherwise)?

Why would you compare the two?

Starting a company that skyrockets in value (Musk, Bezos, etc) will never have a wealth trajectory like an unskilled labourer.

There is no reason to expect wealth to grow at similar rates between people who do very different things, and have very different amounts of money to invest or skills to leverage for a high wage.

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#228

Post by littlestymaar »

rbanffy wrote: post #165
skywal_l wrote: post #147

Earlier quoted context omitted.

Absolutely. Piketty showed that wealth inequality peaked right before WWI and was very low in the 60/70s. The amount of wealth between these two periods does not even compare.

Could the low inequality be a cause for rapid wealth expansion?

It's probably not the only cause, but more wealth for the poor people means people more apt to contribute to the society.

Compare one billionaire buying a mega yacht and 10,000 people buying their first car, in both cases you've created say $200M in direct GDP, but in the later case you have 10,000 people more mobile to get a job or consume other goods or services.

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#229

Post by numair »

romwell wrote: post #10

Ahh, the good old trickle-down, aka "piss in my eyes and tell me it's raining" (which is the only way trickle-down actually works). It was pure mythology from the start; there's never been any basis for it to begin with. It's a pity we even have to debunk it like that. Go figure, give a million hungry people $20 each, and see $20M return to the economy the next day as they spend it on food. Give a billionaire $20M, s…

> Give a billionaire $20M, see the money go into the fintech machine and pour out into offshore accounts, as the billionaire holds on to whatever financial product they bought forever as long as it appreciates faster than inflation.

I know someone who was given a couple hundred million in a GRAT, which grew well beyond $1B, in the exact manner you reference. They aren’t on any of the lists, but I can confirm this exact scenario does, in fact exist.

> Oh, and they'll spend $200 on a fancy dinner.

You forgot about the drugs!

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#230

Post by fitchjo »

fumar wrote: post #162
seibelj wrote: post #141

Earlier quoted context omitted.

A major difference now is the majority of those with vast wealth earned it themselves through creating new enterprises. The aristocrats of old received it through birth or politicking. The rich today are far more effective and organizationally superior considering it was those exact skills that made them their wealth.

Are you arguing that the wealth class today isn’t politicking to maintain power and wealth either to a corporation or themselves?

I think he is arguing the exact opposite.
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