$2.59 trillion sitting uninvested in bank accounts...
... while many workers struggle to afford the basics of life, let alone "luxuries" like a night out. This hurts them, but also the businesses who sell those things. The grocery stores throwing out unsold food. The cinemas screening films to 2 people per session.
This is what happens when economies don't redistribute enough money to workers. Living standards of drop, and productive businesses suffer.
@strypey this might be changing in 2024 as Francisco Partners just closed Delphix. "Our" last big acquisition before that was Puppet in April 2022 IIRC (though there may have been some smaller ones in 2023, the acquisitions largely don't matter to my position)
@musicman
> this might be changing in 2024 as Francisco Partners just closed Delphix. "Our" last big acquisition before that was Puppet in April 2022 IIRC
I'm missing some context here. How does this connect with the subject of my post?
@musicman
Okaaaay, but...
> this might be changing in 2024
What might?
> as Francisco Partners just closed Delphix
I see Francisco Partners in your screenbag, but I'm still lost.
@strypey the article is about them hoarding money before Dec 1, 2023. on February 13, 2024 Francisco announced intent to unload a lot of that cash to purchase Delphix. that deal just finalized not long ago.
I have no insight into what the other capital groups are doing (well, there's Clearlake but I didn't notice if they were on the list) which is why i said might. I'm not sure what caused the 2023 slowdown though I suspect waiting to find value in the AI market might be one reason
@musicman
Ah, OK. I figured it would be something like that, but I didn't want to jump to conclusions.
Our problems are so much bigger than $2.59T but these numbers are too large to imagine. A couple trillion would be a Snoopy bandaid on a slashed carotid artery.
https://www.federalreserve.gov/econres/notes/feds-notes/excess-savings-during-the-covid-19-pandemic-20221021.html
@feld
There are a lot of ways I could respond to this, but just quickly...
> that's not a lot of money
That 2.59T is just one example of the Smaug hoards that pile up when the economy is rigged - in a multitude of ways - to take wealth from workers and give it to capitalists.
Yes, I think it would fix a lot of stuff if we unrigged the economy, and stopped capitalists hoarding money in places like private equity firms, so it could go to...
> workers struggle to afford the basics of life
Every hostage movie ever: million dollar ransom / million dollar reward
Blank Check - kid writes himself a million dollar check
Barenaked Ladies - If I Had $1,000,000
Die Hard - $640M in bearer bonds
Now when people say "One Trillion Dollars" they sound like Dr Evil
> It is always a surprise which lines are people's favorite. The 'one million dollars' has been the one that is so satisfying because it is sort of a fragile joke. The fact that Dr. Evil has been frozen, he is out of date and a million dollars is not much money. It restores your faith in audiences. And it has really stayed in the culture. - Mike Myers
@feld
> During COVID American households accumulated 2.4T in savings
The pandemic was a special case. Lockdowns made it more difficult to spend money, while creating a sense of insecurity in people living close to the breadline, making us more imclined to hoard any we did get (I noticed about year ago that I had been). In general, workers only save for future costs or purchases (eg car repairs, dental visits, mortgage deposits), not just for the sake of seeing more digits on bank statements.
@feld
The private equity system is incredibly corrosive to sustainable business, quality, working conditions, etc;
https://freakonomics.com/podcast/are-private-equity-firms-plundering-the-u-s-economy/
It would be more economically beneficial to set $2.59 trillion on fire (a la The KLF), than to let private equity firms get it.
"Sun Capital - a #PrivateEquity firm - bought up ShopCo and then required ShopCo to sell all of its physical stores and then lease the stores back in perpetuity. Now you can see how that would make a lot of sense if you're a short term investor; you get the initial pop of the sale. But it's tough for the long term investor, because it used to have assets that it could rely on, now it's saddled with these long term lease obligations..."
#BrendanBallou, 2023
https://freakonomics.com/podcast/are-private-equity-firms-plundering-the-u-s-economy/
I note that neoliberal parties do a similar thing in government; selling buildings that house the offices of public services, and making public service entities lease offices instead. The income from the sales makes the books look much healthier while they're in government, but in the long term those leases cost the public far more than the maintenance of publicly-owned buildings.
@feld
> You're not addressing the root cause
I'm pretty sure that was covered by...
> the economy is rigged - in a multitude of ways - to take wealth from workers and give it to capitalists
But by all means, educate me.
@feld
> all these symptoms are from monetary policy which enable the resulting behaviors
What exactly do you mean by "monetary policy"?
Me:
> What exactly do you mean by "monetary policy"?
To be more specific;
(a) what makes a policy "monetary" by the definition you're using here?
(b) what "monetary policy" has been dominant for the past few decades
(c) how do you think that policy caused the "symptoms" we've been duscussing?
Until we fix the money nothing else matters.
@feld
> Until we fix the money nothing else matters
What would that fix look like in your mind?
@feld
> ending government issued fiat
Best of luck with that. I would have thought the crypto-token experiment would be enough to demonstrate the flaws in that line of thinking.
@feld
> if you really believe democracy works you should believe the people can demand this change
Sure, but that's not really the point. Let's review. You're say that"fiat money" is the root cause of symptoms like economic inequality etc, and getting rid of it is the first step to "fix the money".
What I'm saying is that as crypto demonstrated nicely over the last decade, trying to decentralise money in isolation from all the other systemic forces it's tied into doesn't work.
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@feld
That's what the experimental evidence tells us. Let's ponder why.
To a certain extent, "fiat money" is what money *is*. David Graeber's Debt fills in the history nicely. Explaining money's origins in coinage issued by kings, along with taxes that must be paid in those coins, in order to feed and equip standing armies without relying on a centralised supply chain.
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@feld
Yes, other money-like exchange technologies have been created since then, like medieval market tokens, or more recently LETS and timebanks. Douglas @Rushkoff devotes a chunk of his book Life Inc. to exploring some of them.
But even where they completely replaced money in local communities, governments quickly passed laws to make sure the transactions were taxed. Payable in their money, not the local money used for the transactions.
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I would have thought the crypto-token experiment would be enough to demonstrate the flaws in that line of thinking.
How has it done that?
> I would have thought the crypto-token experiment would be enough to demonstrate the flaws in that line of thinking.
@Hyolobrika
> How has it done that?
@feld
> Bitcoin wasn't used by 4 billion people within 5 years or something lol
It hasn't proved useful for everyday transactions, or much else really, besides being the subject of a new tulip mania.
I was very excited about the potential of blockchains when I read the BC white paper in 2011, and about the potential of DAO when I learned about "smart contracts". But having watched what's unfolded, I see no reason to think that potential will be realised as non-state currency.
It hasn’t proved useful for everyday transactions, or much else really, besides being the subject of a new tulip mania.
I find it annoying when people say things like that. It still has censorship-resistance properties which is very useful for, for example, donating to WikiLeaks or Canadian truck men.
I know, I'm doing it, but someone is going to read this and be saved from going down the Retarded Communist rabbit hole.
A while back, the French minister of the economy suggested that Europe should take the money that's sitting "dormant" in EU bank accounts and use it to make "more prosperity".
GUESS WHAT BANKS DO WITH MONEY, THEY LEND IT OUT.
And they'd lend it to this guy, if he made a compelling case that he was going to actually use it to make "more prosperity".
But the reason the banks WON'T lend it to him is because he's going to blow it on private jets and beach houses - and that's why he wants to take it by the force of government.
This is Communists doing Communist things, and it always ends in "people eating the family pet to survive".
Every. Single. Time.
@sun @feld @Hyolobrika that doesn’t even make any sense
@sun @Hyolobrika @feld is this modern monetary horseshoe theory?
@sun @feld @Hyolobrika eat shit and fuck off hyolobrika cocksucker
@stevefoerster
> Just steal it
The problem I'm pointing out is that it piles up because it's been stolen by legal means, from the people who need to use it for everyday things.
> mail people cheques
With a time machine? Who still uses cheques?
@feld
> nobody serious about discussing currency uses the term "tulip mania"
Unless you're arguing that speculation bubbles aren't a thing, this is a deflection, not an argument.
@Hyolobrika
> It still has censorship-resistance properties which is very useful for, for example, donating to WikiLeaks or Canadian truck men
Ok, but edge cases like this are no indication it can "fix the money" by "ending government issued fiat".
@sun
> people down here use it for remittances to back home in latin america
Yes, people use it for converting one state currency to another. I did this once to move money out of China.
But these uses are only possible where both states whose currency is being used tolerate it, or lack the enforcement power to prevent it. I only did it once because the site I used had its ability to sell RMB for BTC shut down by the Chinese government, and I never found a replacement.
You could have done a P2P trade, maybe.
Some might say that states lack the enforcement power to prevent anything if enough people want to do it. See chapter 1 of Anti-tech Revolution: Why and How (attached).
You can't effectively use a cryptocurrency or private currency because we have this albatross hanging around our necks. I suspect that you see the government as a counterbalance to private/corporate power. That concern is valid but in practice it doesn't do it.
If you want to argue that as a practical matter government is not going away so cryptocurrencies will never be viable I respect that position but it also implies that active resistance is justified.
>it is an argument against shit government
there's no such thing as a non shitty guvment
though as far as i can tell not investing is retarded due to inflation
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@cjd
You're completely missing the point. Let's say there are 2 overall ways for businesses to get money, from customers, or from investment (business loans, VC etc).
If the economy is set up so they mostly get it from customers, that has 2 effects. Most importantly, it gets goods and services into the hands of people who need them, increasing our standard of living. But it also decentralises decision-making about which business gets how much money.
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If it's set up so they mostly get it from investment, this has very different effects. It doesn't facilitate getting goods and services to people. It centralises decision-making about which business gets how much money in the hands of those with most money to invest. It also increases the coat of economic rents to the economy (interest, dividends etc).
This is free markets 101. It's hilarious that you think anything involving money and markets has anything to do with "communism" 🤣
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BTW when Adam Smith and his contemporaries talked about "free markets" they meant free of economic rents, not free from regulation. There's a little-known quote where Smith talks about what a bad idea it is to let financiers anywhere near the levers of government. Because they inevitably distort market regulation to increase their opportunities to extract rents.
This has been happening for decades, and it's what people mean when we criticise "neoliberalism".