Classic blog analyzing money as insurance against other rich people
interfluidity.com/v2/3487.htmlPosted Apr 9, 2019, 7:38 AM UTC
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interfluidity.com
Not idpol, but dammit, I know no other even vaguely socialist spaces where I don't risk getting banned, and this is a damn fine blog.
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This is some really great shit. Thanks for sharing!
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Extremely good shit, one more chip in the crumbling wall of "pareto efficiency" that forms the (stupid) foundation of market efficiency - and something that simply doesn't align with history. The implication is clear: unequal societies aren't just unfair, they are empirically inefficient.
There is a market crash coming, and it's fundamental cause will be a collapse in aggregate demand. And what caused that drop in aggregate demand? Income inequality. Rich people don't spend, middle class consumers do.
One of the biggest secrets Austrian school economists don't want to admit is that one of their OGs that Hayek and Mises studied from, Friedrich von Wieser, figured out that monopolies and skewed distributions of wealth absolutely lead to inefficiency via theories of marginal utility (As that article mentioned).
Pareto efficiency is just the voodoo that property fundamentalists bullshit to defend the status quo (Because according to them, property rights aren't just in their own interest, they're actually "efficient").
I hesitate about the crash part, though. Could there could also be a very long tail in the trend of social insulation via geography and capital liquidation via technology? Say we are in a transition where the overhead efficiency issues in distribution of lower end commodities can be solved first by gutting retail, then subverting market choice, then erasing it altogether, then replacing what is left with fraud. And say something comparable can be done with services management and facilities by replacing them with digital interfaces that go unmaintained or worse. I’m no wall street expert, but it seems to me that mitigating the abundance of operating and distribution overhead in so many market sectors could allow the markets to downsize without a crash, and I don’t see anything stopping industry from pulling that off in the U.S. This is apparently Amazon’s business plan, right down to the fraud. Meanwhile, their urban presence and higher end retail market is all about abundance of choice and cutting edge convenience. If industry can just scale on demand, isn’t that the best way to avoid a crash?
All that said, I am pretty clueless when it comes to real estate markets and loan defaults, and similar things, so I have no idea what I’m talking about in the big picture.
The out sourcing of manufacturing means that retail is also the largest employer, so a gutting of retail also includes a gutting of aggregate wages, and therefore consumer spending. Same with other 'efficiency' measures - business may continue to operate but the demand falls through. That's when we enter a new great depression, or at least America does. China may survive and do quite well, but America is 100% fucked. America needed to cut trade with China a couple of years ago and get is manufacturing back, but it's probably too late now.