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Yes, but for the past 40 years the game has been rigged so that all of our productivity gains go to profit and not to labor. This has produced many distortions. It isn't sustainable or efficient in any consumer-capitalist system.
Basically, the villain Reagan was behind all this. And he looked like such a nice guy on TV.
But there is also a second way to make money. That’s the rentier way: by leveraging control over something that already exists, such as land, knowledge, or money, to increase your wealth. You produce nothing, yet profit nonetheless. By definition, the rentier makes his living at others’ expense, using his power to claim economic benefit.
For those who know their history, the term “rentier” conjures associations with heirs to estates, such as the 19th century’s large class of useless rentiers, well-described by the French economist Thomas Piketty. These days, that class is making a comeback. (Ironically, however, conservative politicians adamantly defend the rentier’s right to lounge around, deeming inheritance tax to be the height of unfairness.) But there are also other ways of rent-seeking. From Wall Street to Silicon Valley, from big pharma to the lobby machines in Washington and Westminster, zoom in and you’ll see rentiers everywhere. Studies conducted by the International Monetary Fund and the Bank for International Settlements https://www.imf.org/external/pubs/ft...15/sdn1513.pdf - not exactly leftist thinktanks – have revealed that much of the financial sector has become downright parasitic. How instead of creating wealth, they gobble it up whole.
"Freeloaders," ? I doubt seriously...I am an industrial engineer and mathematical economists and I bust my "you know what" in research...why don't you just blame the Billionaires as being freeloaders ...bet you wouldn't do that....
Were those that borrowed money forced to do so at the point of a gun, or did they do so voluntarily?
Yes, but finance in the US is extremely predatory and dishonest. When you dig into what was actually happening prior to 2008, it's simply insane. The lenders knew precisely what they were doing, but they successfully pleaded ignorance and had a party with the billions they'd "earned". The people on the other end of the deal were left holding the bag.
If nobody profited from taking risks society would never advance... landlords don't exist to give you free housing. Stop talking like a communist. Profiteering might not be ideal, but without it there would be no incentive to do anything in society and innovate to create new technologies. I'm just supposed to rent my place out at a rate below what supply and demand dictates to not be greedy, ignoring the fact that half the time you'll find a tenant that tries to sneak in pets or trash the place who doesn't care about it because it's not theirs.
If a tenant proves to me they are respectful, I may just leave their rent fixed for a decade because a respectful tenant is worth their weight in gold in a society full of narcissists doped up on antidepressants.
Seriously...
Had a tenant complaining about his rent. I told him he's been there for over two years without a yearly rent increase. That means I like him, but he's free to leave whenever and I'll fill the space in less than 24 hours for a better rental amount for me.
There's been talk in my area about rent control. I don't think its serious, but whenever I do get involved with that conversation my take is they're free to implement it, as I'm free to just evict everyone and shutter the building (most of my income used to come from rents, now it's a rounding error).
Until someone has the misfortune of being a managing landlord and deals with the bs that comes from it, they can take their complaints about rents elsewhere.
Yes, but finance in the US is extremely predatory and dishonest.
That's painting with an overly broad brush. Most people and institutions in the financial arena are no worse than those in any other field of endeavor.
Quote:
Originally Posted by rruff
When you dig into what was actually happening prior to 2008, it's simply insane. The lenders knew precisely what they were doing, but they successfully pleaded ignorance and had a party with the billions they'd "earned". The people on the other end of the deal were left holding the bag.
In actuality, falling interest rates created opportunities for gains through financing and refinancing that many if not most people should have taken advantage of. The problems arose as scrupulous and unscrupulous practitioners reacted differently to the fact that a point eventually came when everyone who wanted or was qualified for a new mortgage already had one. The game should have wound down at that point, but the cowboy corps just couldn't let go of the glitzy profits and bonuses they'd been raking in during the good times. So they created worse and worse quality paper that eventually clogged up credit markets. That was THEIR doing though, not everyone's doing. Kick in the shins as well to the sad-sack "regulators" who just sat back and watched it all happen.
Yes, but finance in the US is extremely predatory and dishonest. When you dig into what was actually happening prior to 2008, it's simply insane. The lenders knew precisely what they were doing, but they successfully pleaded ignorance and had a party with the billions they'd "earned". The people on the other end of the deal were left holding the bag.
Had a tenant complaining about his rent. I told him he's been there for over two years without a yearly rent increase. That means I like him, but he's free to leave whenever and I'll fill the space in less than 24 hours for a better rental amount for me.
There's been talk in my area about rent control. I don't think its serious, but whenever I do get involved with that conversation my take is they're free to implement it, as I'm free to just evict everyone and shutter the building (most of my income used to come from rents, now it's a rounding error).
Until someone has the misfortune of being a managing landlord and deals with the bs that comes from it, they can take their complaints about rents elsewhere.
I've been at my job for over two years without a wage increase. Rent already consumes half my income.
But there is also a second way to make money. That’s the rentier way: by leveraging control over something that already exists, such as land, knowledge, or money, to increase your wealth. You produce nothing, yet profit nonetheless. By definition, the rentier makes his living at others’ expense, using his power to claim economic benefit.
For those who know their history, the term “rentier” conjures associations with heirs to estates, such as the 19th century’s large class of useless rentiers, well-described by the French economist Thomas Piketty. These days, that class is making a comeback. (Ironically, however, conservative politicians adamantly defend the rentier’s right to lounge around, deeming inheritance tax to be the height of unfairness.) But there are also other ways of rent-seeking. From Wall Street to Silicon Valley, from big pharma to the lobby machines in Washington and Westminster, zoom in and you’ll see rentiers everywhere. Studies conducted by the International Monetary Fund and the Bank for International Settlements https://www.imf.org/external/pubs/ft...15/sdn1513.pdf - not exactly leftist thinktanks – have revealed that much of the financial sector has become downright parasitic. How instead of creating wealth, they gobble it up whole.
You know, I love posts such as this. For people who use the term "Society" in this context are really trying to build a construct where their utopian fantasies are imposed on everyone else. They want to reorder the world to be the way they think it should be. It is a badly-disguised politics of envy, the notion of "I don't have it so you shouldn't."
The problem with Pikety's beliefs are manifold. He ignores that the people with high wealth today, people such as Gates, Bezos, and Buffett, earned every dime of their wealth. What's more, I find that his theory of economic inequality flies in the fact of statistical fact, especially when you realize that extreme poverty as a percentage of the total global population has cratered over the past 25 years.
So if we are living in an age of inequality, then why is it that extreme poverty rates have dropped from roughly 44% to less than 10% in the course of a generation? The creation of wealth is worldwide. The reason for that is simple. The markets have become unfettered and allowed to do their work.
I certainly don't fit the original post. I've built three business and sold two. I've never stopped working. But I know people like that and they are typically anything but lazy. They support charities and foundations. Their money gets invested prudently, which then turns into businesses and jobs and other things. In other words, their investments are funding the very creation of businesses that have reduced the poverty rate described above.
In truth, Pikety's theories are just Marxism wearing nicer clothes. And Marxism creates poverty and misery and oppression wherever it is practiced. And the more thoroughly its tenets are followed the worse the results. I mean, look no further than Venezuela. Twenty years ago, the wealthiest, most stable country in Latin America? Today, after two decades of Socialism, a complete basket case of a country.
Yes, but finance in the US is extremely predatory and dishonest. When you dig into what was actually happening prior to 2008, it's simply insane. The lenders knew precisely what they were doing, but they successfully pleaded ignorance and had a party with the billions they'd "earned". The people on the other end of the deal were left holding the bag.
You realize that the free-for-all was initiated in the 1990s when the Federal government, through FMAE and FMAC, implemented policies that mandated lower lending standards. As someone who consulted with a lot of mortgage lenders and banks, I knew banks whose charters were at stake if they didn't lend to applicants with lower credit scores. One of my clients, a century-old mortgage lender, sold their mortgage portfolio entirely in 1999 and shifted their business to insurance because they knew it wasn't sustainable.
So the mortgage meltdown was a public-private partnership between the federal government that changed the underwriting rules, creating a situation that some unethical players could export.
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