Can someone explain to me how the economy is not a finite pie and everyone gets a slice?

Can someone explain to me how the economy is not a finite pie and everyone gets a slice?

AFAIK There is a certain amount of money that grows steadily that represents goods and services and we all capture our share.

If i open a business im capturing more money not creating more... If i produce more goods and services they will just be absorb or reject by the economy but the money supply doesnt change. Only its value changes.

Only the fed can "grow" the pie by printing more money as the economy expands.

Better technology and efficiency means less time is spent extracting resources and turning them into finished goods, which in turn frees up labor capital to engage in other things, essentially adding value to the overall economy.

/biz/ here
You forgot to include goods and services in the lie. If you start a chair business and build 30 $100 chairs, the pie just got $3000 bigger. Your net worth is $3000 bigger

Also, as societies scale up in complexity, so does labor specialization. Instead of 95% of the people engaged in farming to feed the society, we now have 2-3% of the people farming in western nations. That frees up massive amounts of labor to engage in research, trade, and infrastructure building.

>pie, not lie

Because economies produce things

Freudian slip?

>Only the fed can "grow" the pie
That certainly isn't what it's doing. You would just have more currency chasing the same amount of assets. Otherwise, Zimbabwe would be the richest country in the world.

trade is mutually beneficial, and labor is a renewable resource.

every day, more labor is added to the economy, more of other base resources are added to the economy, and the economy gets larger.

there's more silk in the world today than there was yesterday.
tomorrow there will be more silk dresses in the world than there is today.

growth.

Keybordian slip

Inflation much?

Value is assigned arbitrarily by humans. Money can be printed and interest rates can be altered. There is literally no such thing as hoarding wealth.

You're mistaking value for money. Money merely represents the amount of goods and services one can buy, it has no value on itself. That's why when you print money, it loses its value, because now there's more to go around, lowering it's value.

It's the same principle for everything else. If we had a limited amount of money (aka if it wasn't always growing), the money would increase in value.

Since there is always more products than there are money going around, the pie of wealth is always increasing. Inflation, though, balances this down by creating more money.

I would like to not enter in the merit of inflation is good of bad for the economy, but what I said is simply the way it works.

You can still hoard wealth. But that isnt whats killing the system. Obama's tiny GDP growth is killing us. Not one quarter above 5% growth. Theres your lack of wage growth

You really can't hoard wealth. There's nothing stopping the federal reserve from printing more bills. The value of money would decrease, sure, but if it were the only option then it would happen. Attempting to hoard wealth is thereby financial suicide, so it will never happen in real life.

So why hasn't the monetary policy of Zimbabwe been successful?

> Attempting to hoard wealth is thereby financial suicide, so it will never happen in real life
If you hoard assets whose real value stay the same, (i.e., their market value matches inflation), you can in fact, hoard wealth. I don't see what the point of your remarks are.

You're right. "Hoarding wealth" in the real world isnt what people think it is. But the wealth gap is very real. The reason for the wealth gap is not the wealth gap. The reason is the lack of gdp growth,

Yeah dude but theres a difference between expanding the available credit money to allow for an expanding economy and.................printing literally trillions to bail out your crooked globalist banker buddies.

gl with that system

If his point was that the wealthy can't hoard wealthy because of inflation and artificial interest rates, he was sadly mistaken, and in fact, they benefit more from those measures because they have much more flexibility in directing their income streams, while workers are dependent on wages which have been shown time and time again to decrease at a slower rate than inflation.

How can you claim that wealth hording is happening while also accusing the wealthy of "directing their income streams"? Those are two mutually exclusive things.

Also take off your name.

Wages have nothing to do with inflation. They rise with GDP. No GDP growth = no wage growth. Tell this to liberals please

>How can you claim that wealth hording is happening while also accusing the wealthy of "directing their income streams"?
I suppose it's dependent on what you mean by "hoarding wealth." The wealthy can take advantage of the lowering of interest rates by moving their wealthy our of currency into assets, and then moving it back to currency shortly before another bust, while the lower classes can't.

I would that it's correct that you can't hoard wealth in currency as such on a large scale, deflation would just occur, but because of the Fed's policies, you would never invest in one thing through booms or busts if your wealth was completely liquid.

I would say that's not technically true because inflation can harm wages disproportionately to other forms of revenue.

Moving your currency into assets is factually the opposite of hoarding wealth. You can't hoard wealth while investing into businesses or commodities. Those are two directly contradictory things.

Wages are not driven by inflation. They are driven by gdp

For in example in France, there is a wealth tax and high inheritance taxes, as well as a tax-based incentive to invest you money.

There is no possibility to "hoard wealth" afaik.

No...

GDP growth only helps the top 1%.

The wealth gap is caused by mass immigration.
There is no reason for your boss to raise your wages, regardless of whether he's making lots of money or not, when there are 3+ billion people willing to do your job for a tenth of your wage.

>Wages are not driven by inflation. They are driven by gdp
Were you reading what I was saying? I said wages are negatively affected in inflation.

Wages have nothing to do with GDP when there's mass immigration.

This is what happens when you let Democrats run the public school system

>For in example in France, there is a wealth tax and high inheritance taxes, as well as a tax-based incentive to invest you money.
Okay? That's just one law. It's not the case that you can't hoard wealth in other countries. If somebody hoarded gold, which will probably always maintain its value, they could in fact hoard their wealth, even though that's not what the wealthy does.

If anybody thinks I'm condemning the rich, I'm not.

Take an economics class

So why do small homogeneous Nordic countries have higher wages than we do even though their GDP is less than 1 trillion?

I was an econ major at a top 15 university.

Econ is bullshit. Sorry, mate but you were taught theoretical horseshit.

Money isn't the economy. Goods and services are the economy, money is just the medium we use to track, store and exchange value. Moreover the amount of money that actually exists is far smaller than the amount of money that is practically in circulation because of banks, lending, and interest.

The Fed can't grow the pie either, printing more money doesn't actually create more value, it in fact devalues the rest of the money, hence inflation.

Think about it this way, if you have ten farmers, and each farmer produces a bushel of some fruit, that fruit is the actual wealth. Now let's say they use coins to buy fruit from each other because they don't want to lug around buckets of apples to pay for apricots. The King comes along and mints triple the amount of coinage that there currently was, and dumps it into the market.

Is anyone actually richer? Are there more apples and bananas than there were before? No, there's just more money. The economy is not money, it is what you can buy WITH money.

>Moving your currency into assets is factually the opposite of hoarding wealth. You can't hoard wealth while investing into businesses or commodities. Those are two directly contradictory things.
I don't agree? That's just asinine. There's no fine distinction between what would consist of investing or hoarding, but investing it in assets that will only appreciate or maintain their value should be considered hoarding, or the term is meaningless.

Otherwise, what would be hoarding? If I found some currency that didn't inflate and held all my wealth in it without investing or consuming it?

>what is population size?
You don't know anything stop lying

So are you admitting that smaller population leads to higher wages?

What would immigration do?

No, per capita GDP growth leads to higher wages. Are you fucking slow?

Japan has a higher GDP Per Capita than South Korea, yet the latter has significantly higher wages than the former

GDP Per Capita is just a measure of economic output. It tells us nothing about how that output is shared between the employer and employee.

The idea that by having a low interest rate stimulates the economy and spending and having a high interest rate encourages saving really aggravates me.

The main reason is if you save during a low interest rate, you will have more to gain when it is flipped to a high interest rate in future. The encouragement to buy goods and services which are fundamentally not wanted or needed is ridiculous, and I do not see how this is a fix to a stagnated market.

It is all artificial. You can force people to spend money by making them fear it will be worth less in future. So OK now you choose to buy assets, but the assets are artificially higher since everyone wants to buy them for fear of money being worth less.

This is why I think it is important to diversify not only your assets and savings, but also your jobskills. Don't even get me started on state pensions.

>explain to me how the economy is not a finite pie

since when is wealth finite

if the wealth is static or shrinking the economy will be failing

that's all there is to it

>Only the fed can "grow" the pie by printing more money as the economy expands.

no you asshole that's not how it works

>growth
>GROWTH
Where did I say it measures directly?

Fuck this Im going to back to /biz/. Keep thinking it was the jews and not Obama and the Fed policies

>The idea that by having a low interest rate stimulates the economy
I would say that in almost any situation in the short-term, having low interest rates stimulates an economy, (though perhaps to a negligible degree), though this doesn't mean it's always the best policy.

>having a high interest rate encourages saving really aggravates me.
Having a high interest rate would always encourage saving than having a lower interest rate in the same situation.

>The main reason is if you save during a low interest rate, you will have more to gain when it is flipped to a high interest rate in future
I don't agree with this whatsoever. I'm not sure what school of economics you subscribe too, but like in investing, you should buy low and sell high, which would mean saving when interest rates and asset prices are high, and buying when they are both low.

>The encouragement to buy goods and services which are fundamentally not wanted or needed is ridiculous, and I do not see how this is a fix to a stagnated market.
I'm personally very suspicious of any methods to try to increase consumption to end recessions, but even without artificially low interest rates, interest rates would naturally lower during recessions.

>Spending your wealth is hoarding your wealth.
>You're asinine for implying that you can't horde wealth.
Buddy, just give it a rest. To invest is to spend money. To spend money is not to horde money. You can't surmount these simple facts.

So if there were a currency that I could hold that would maintain its real value, I could hoard?

>money that grows steadily
It doesnt
GDP growth rates change frequently and sometimes even contract

That line of thought doesn't interest me in the slightest. Either use logic to surmount my facts, or abandon your argument.

I'm trying to ascertain what you would mean by hoarding.

>Can someone explain to me how the economy is not a finite pie and everyone gets a slice?
there are countless little pies constantly being made by productive people. unproductive people get some pies out of pity so they don't starve, but some think they're entitled to the same amount of pies as people who actually make pies.

coming to Sup Forums to ask about economics

SAGE

US GDP has been growing for the past 40 years and wages have stagnanted.

GDP growth doesn't mean the effects will trickle down to you. There is no logical reason for your boss to raise your wages when the labor market is glutted.

hoard
hôrd/
verb
gerund or present participle: hoarding

amass (money or valued objects) and hide or store away. "thousands of antiques hoarded by a compulsive collector"

informal: stash away, salt away. "they hoarded rations"

reserve in the mind for future use. "a year's worth of hoarded resentments and grudges"

just bake another pie, user

>Either use logic to surmount my facts,
And how is a person not "amass[ing] (money or valued objects) and hid[ing] or stor[ing] away," something when they hold an asset to be sold at a future date?

A share of a company is not an object and, logically, if that person seeks to sell the share as soon as possible then they aren't hoarding it.

kek

WHAT HAPPENED TO BAM LOL

>A share of a company is not an object and, logically, if that person seeks to sell the share as soon as possible then they aren't hoarding it.
I wasn't talking about shares. I was talking about assets like gold.

GDP isn't wealth

He selected all images with "food".

Are you suggesting that the wealthy elite are hoarding gold coins like Scrouge McDuck?

(apart from a few great posters) ITT: not a very good understanding of the difference between financial assets and real assets

He's turning into Phil lmao

No, but this is answer to the notion that the rich can't hoard.

If this based on some sort of antagonism you think I might have towards the rich, believe me, I have no problem with any level of wealth inequality that's achieved through a free market, which doesn't exist today.

That's no answer at all. You're trying to evade the point.

Looked, you asked me a question and I said no.

Conservation of buying power.

There is a finite amount of buying power that exists in the world, while currency can only abstractly represent portions of this buying power. So yes, on the small scale you are correct.

HOWEVER: What is generally described as "growing the economy" is actually more specifically a reduction in the buying power required to purchase a specific good. So yes, you can "grow" the economy by proportionally allowing more and more goods to be purchased with quantitatively the same amount of buying power.

You were obligated to prove that hoarding is possible with fiat currency. You failed. Sasuga namefag.

How exactly was I obligated?

If somebody hoarded gold, which will probably always maintain its value, they could in fact hoard their wealth, even though that's not what the wealthy does.

Keep thinking that goy. Gold was over $1800/oz not even 5 years ago, and is now around the $1300s

If everyone start hoarding gold, the prices will go up, and at a certain point people will start selling because their investment would pay off, and they prices will taper off or fall.

If you hoard any investment/asset without any intention whatsoever to sell, you just got yourself into a hobby. You just spent money.

Look back to the start of the argument. You were arguing that wealth hoarding is a reality in modern economies. You lost track of the argument through cognitive dissonance. There has never been a point in this discussion in which you have been more right than me.

I suppose there are cases where bubbles can be created in individual assets, but gold has appreciated better than any currency and there are only small windows in the last century where a bubble was being formed in gold prices, and it maintains its value much better than cash.

His best friend died in a car crash. He hasn't been well.

>Moving your currency into assets is factually the opposite of hoarding wealth.
I don't think this was accurate.

> You were arguing that wealth hoarding is a reality in modern economies.
When? I only said it was possible. The reality is that there is thing as a bright line when it comes to hoarding. Somebody who buys a least lasting a century could be said to consume, and a stock trader could be said to waiting for a stock to appreciate if even for a matter of seconds. I would say that when interest rates are high enough, some of the wealthy try to do something that could be considered hoarding not only because saving is then more rewarding, but they can wait for a time when asset prices have considerably depreciated during a recession.

Moving your currency into assets is, factually, the opposite of hoarding wealth. You can't spend money while hoarding it at the same time. You have no logic whatsoever. I'm getting tired of your cognitive dissonance. Stop. Construct a logical argument as to how one can spend their money while hoarding it at the same time or don't respond.

>When did I say that wealth hoarding is a reality?
"The wealthy can hoard wealth even in spite of inflation and artificial interest rates. They benefit from these things." - Not to mention the fact that you wouldn't have responded to my initial posts if you weren't seeking to prove something to the contrary. Backpedal more you positionless fruit.

And there's the thread. Great answer, m'boy.

Fpbp deserves dubs

>Moving your currency into assets is, factually, the opposite of hoarding wealth. You can't spend money while hoarding it at the same time. You have no logic whatsoever. I'm getting tired of your cognitive dissonance. Stop. Construct a logical argument as to how one can spend their money while hoarding it at the same time or don't respond.
So suppose you moved assets into currency. Would that be hoarding wealth?

>Not to mention the fact that you wouldn't have responded to my initial posts if you weren't seeking to prove something to the contrary.
Strictly speaking, I said they could do this, but didn't want to generalize and say they all do it. I'm not backpedaling because I believe that saving wealth merely to be spent at a later time is hoarding.

Your net worth includes production costs and everything leading up to POS. Even then, the market is placing a value on the product equivalent to money, not creating new money.

Gold in general is a not a great investment. It's normally used to avoid losses when everything else, mainly stocks goes down.

In the last century, stocks outperformed gold by a long margin, but keeping a certain amount of your wealth in gold helps in times of turmoil because that's when gold shines -see what I did there? I'm hilarious

Currency is not wealth. You could have a billion dollars from the bank of Zimbabwe and not be rich. Hoarding currency is one of the only surefire ways to make yourself less wealthy.

The rich don't hoard money. They invest it. If they hoarded the money then their net worths would depreciate and fade to nothingness.

Don't banks do it too by loaning out more money than they have?

I was comparing it to currency, just to make a point.

>The rich don't hoard money.
I would say they hoard money when they expect asset prices to collapse soon.

>Hoarding currency is one of the only surefire ways to make yourself less wealthy.
So they can hoard currency? I would say if you expect asset prices to collapse, hoarding currency would be an excellent way to make money.

Don't change the subject. Currency is not wealth in and of itself. You're meandering from point to point without any argument. It's disturbing and wrong.

>Currency is not wealth in and of itself.
Why are you saying that? Did I imply that?

>mfw im a drunk fucking loser living with mom that cant deal with tragedy yet have all the fucking money on the earth and cant do shit with it cause im a fagget

The Economy, what will it do next?

Can someone explain to me how the economy is not a finite pie and everyone gets a slice?

>be a very rich person
>run a company that is making plastic products
>one day decides to exit
>sell shares to a china based company
>keep all the money from the exit
>do cocaine and travel around the world
>die
>your son and daughter inherit all the money and become degenerate

This only reduces the purchasing power of the people who have monopoly money, and not actual resources like food, metals and so on.

Their share decreases, while the people who own industries, gold, land etc. grow their slices because their stuff is always valuable.

You were obligated to prove that it is possible to hoard wealth with fiat currency. You said "So suppose you moved assets into currency. Would that be hoarding wealth?"

Listen: If you're this desperate, then take a hint and vacate the discussion. It's shameful to just keep posting when you don't have a leg to stand on.

Everything about what you said is stupid.

>The economy is finite/of tangible value
Let me put this bluntly, the economy is of infinite value as value is a relative human concept. This is why businesses can flourish and go under in days; value is relative.
>The economy cannot grow/wealth is fixed
Wealth is relative as well. The economy can grow, even if we're talking about real terms through better use of resources.
>Growing money/expanding money supply
Hopefully, money is not printed more than the need for exchange, but if money failed to be available as a means of exchange, other means would fill the gap.

>You were obligated to prove that it is possible to hoard wealth with fiat currency.
I don't see how I was obligated. I just wanted to know if you would consider a certain action to be hoarding. How does asking that question mean I was trying to prove it?

I just demonstrated to you that you're obligated to do so. Do we have to do this again? Are you just going to play dumb all day?

>I-I-I-I-I-I was j-j-j-just asking a simple question... And arguing with every simple explanation...
You'll get no more responses if you don't put up an argument. You're selfishly wasting my time because you don't want to admit that you were wrong.

How was I obligated just by asking the question?

>I would say they hoard money when they expect asset prices to collapse soon.

I never implied people don't hoard money or anything else. Some people certainly do.

But hoarding just makes sense if you believe the asset in question will appreciate in relation to other assets.

The sum of people that do and don't believe in that appreciation, plus the timing of that hypothetical appreciation makes hoarding a non-issue

>The sum of people that do and don't believe in that appreciation, plus the timing of that hypothetical appreciation makes hoarding a non-issue
I wouldn't say whether it's an issue, but almost certainly, the largest amount of hoarding is done by companies that have hundreds of billions in foreign countries in order to avoid taxes by repatriating it. I can't say what effect this would have on the economy, but I would say this is evidence of hoarding.

And hoarding in this sense that I described, could also be called "saving"

But you would allow that companies that keep funds in foreign companies which would otherwise be invested as a form of tax avoidance could be rightly called hoarding, correct?

Sorry, foreign countries*

Again, no.n issue. If a company chooses to save their cash for a future investment, expansion, or to avoid being taxed, that saved money will be used by someone else. As surely the CEO won't keep that money under his mattress, but invested in a bank. As I mentioned in another post, this is the definition of savings.

It's their money. They can do whatever they want with it for all I care as long as it's legal.