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AceGolfer, GDP represents the aggregate of all FINAL, (i.e. not intermediate) goods and service products. Transfers of wealth are not production of additional goods or services and they are not included within calculations of GDP.
The production or remodeling of a building contribute to increased production of goods and service products. Even the real-estate broker fees are payments for service products. The profit or loss due the the transfer of the house's deed, (i.e. the certificate of ownership) was not an increase of goods or service products. That's simply transfers of wealth. The insurance broker's fee is a service product. But the insurance companies' revenues from sales of policies, and their payouts for casualty losses are transfers of wealth and do not contribute to the nation's GDP. Losing bets and winner's gains on insurance, horse-racing, or the stock and bond exchanges, are all transfers of wealth.
The liquidity of finances provided by the NY stock exchange is of some economic benefit to the nation, but the exchange's PR implying their exchanges are "investing in America" is B.S. Only if your purchase of a share of a goods or product producing enterprise, (rather than a financial enterprises that are essentially financial funds) provided capital improvement to that goods or product producing enterprise, did you actually invest into that enterprise. Almost the entire transactions of the NY stock exchange are transfers of wealth and other than their brokerage fees and they didn't contribute a penny to their nation's GDP. Purchase of an enterprise's debts is never an investment into the enterprise; it's a bet that the enterprise will eventually pay that debt).
AceGolfer, if we added the value of ford's annual 6.6 million vehicles produced;
subtracted their materials and other costs, the Ford Motor Corporation's payments for wages, salaries, sales commissions contributed to USA's aggregate individuals' incomes are less than the company's net contribution to our nation's GDP.
This is also the case for each enterprise that provides materials, products, or services to the Ford Motor Corporation. Why would you suppose that the nation's aggregate production of goods and services, (i.e. our GDP) would not be greater than the incomes of individuals that participated or profited from those productions?
Our nation's GDP and our aggegrate incomes are two different things.
HooNose, you're certainly correct. The CPI does not keep pace with the GDP and the extent that it doesn't do so is detrimental to our median wage, middle-income segment of our population, and drags upon our entire economy.
HooNose, you're certainly correct. The CPI does not keep pace with the GDP and the extent that it doesn't do so is detrimental to our median wage, middle-income segment of our population, and drags upon our entire economy.
I'm having trouble parsing this. You're saying that because consumer costs don't go up as fast as the GDP, it's detrimental to our middle-wage economy?
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