The philosophy of wealth creation

[Procrustes Stretched]

In a transaction nobody is losing wealth. If I buy a book I haven't lost any wealth, I've actually gained and so has the person who sold me the book. I value the book more than I valued the money, and they valued the money more than they valued the book.

All this suggests is that wealth is subjective and relative rather than objective and absolute. Which is not necessarily inconsistent with either side of the question concerning it's creation. I do hope you're not a Randian Objectivist, or this could really undermine your lofty ideals.

Wealth is perceived, Mani.

One man's trash is another man's treasure.

Would you like to know more?

poor mani, what a way to end the year.

 

[Paulie]

My point about trash and treasure was that a pile of popsicle sticks, for instance, are trash to one person, but can be useful supplies for someone who builds crafts out of random items.

 

[Procrustes Stretched]

If I were so narrow-minded as to equate wealth with printed currency, I might be inclined to agree with you. Unfortunately I'm not, and your argument is decidedly non-compelling.

There is a reason that this is a philosophical discussion...in many ways, it comes down to what one truly believes wealth to be a measure of.

You qre so narrow-minded as to equate wealth with energy. Fortunately I'm not, and your argument is decidedly non-compelling. Confusing the worth of things with theirpercieved or real existence is an error of Randian proportions. A bar of gold has no inherent worth.

Magus: ''It is my philosophical understanding that wealth cannot be created. I contend that wealth adheres to a law similar to the law of conservation of energy...A consequence of this law is that energy cannot be created nor destroyed. The only thing that can happen to energy in a closed system is that it can change form
The law of conservation of wealth, as it were, would state that the total amount of wealth worldwide (an isolated system) remains constant over time. The only thing that can happen to wealth in a closed system is that it can change form…and ownership.''
.
..and here is where MP exposes his achilles heel: ''Once one acknowledges and accepts this, a thing I believe to be an obvious truth, one then begins to understand the true ...''

MP is stating things as truths even as he says IT can't be proven one way or another.

MP considers it an obvious truth. I do not believe it is provable either way.

Anything else I can clear up for you?

yeah, I have this appendage on my butt. It goes by the name of colin. what can I do to excise IT?

and what if little boy blew gets Dante Fevah, will DevNell be banned or censured?

what does the fastest horse say about this?

 

[Procrustes Stretched]

How can wealth not be created if I can use trees, which are virtually infinite and certainly renewable considering I can use their seeds to grow more, to build a house?

I can plant the seeds of an apple, and years down the road, I can have apples to eat and to sell.

In both of those cases, I have created wealth without destroying wealth because of the infinite nature of the sources to begin with.

I don't see why you think either of these are examples of creating wealth. These are examples of exploiting nature to improve your standard of living. I don't see why that would in any way be connected to worldwide wealth. That is, unless you think that wealth is synonymous with standard of living (like the dimwit blogger xsited1 linked). I do not. Correlated yes, but not remotely synonymous.

standard of living connected with wealth? weren't you the one who threw out the idea that linked weath with welfare in order to divine this truth you say exists?

 

[manifold]

How can wealth not be created if I can use trees, which are virtually infinite and certainly renewable considering I can use their seeds to grow more, to build a house?

I can plant the seeds of an apple, and years down the road, I can have apples to eat and to sell.

In both of those cases, I have created wealth without destroying wealth because of the infinite nature of the sources to begin with.

I don't see why you think either of these are examples of creating wealth. These are examples of exploiting nature to improve your standard of living. I don't see why that would in any way be connected to worldwide wealth. That is, unless you think that wealth is synonymous with standard of living (like the dimwit blogger xsited1 linked). I do not. Correlated yes, but not remotely synonymous.

Exploiting nature???

Human beings have to eat and drink to survive. That REQUIRES nature to be used. Is drinking water that falls from the sky "exploiting nature" any less so than eating an apple?

Are we going to invoke darwinism in this discussion? Because I'm fully ready to do so

You have ascribed a negative connotation to the word exploit that was not intended.

 

[Big Black Dog]

I've been broke before and I've been semi-wealthy. I like being semi-wealthy the best. I seem to have more fun.

 

[namaan]

Hey all,

I read the link posted by xsited1 since he is apparently a physicist:

Coyote Blog » Blog Archive » Wealth Creation and the Zero-Sum Fallacy

The reason him being a physicist is important to me is that I've had similar inclinations to try and understand relationships between thermodynamics and economic dynamics. I find much of the linked article to be reasonable, but I'd say lets not throw out the baby with the bath water.

Do breath nuance into my understanding where appropriate, but fact is, inherently, the earth and the universe have to answer to thermodynamic laws. The argument that the thermodynamic definition of energy is not an analogue to money in an economic system is typically made in reference to our ability to print money, as much as desired.

I see this as a fundamental fallacy; to me, this isn't an 'ability' at all. Rather this is a misrepresentation of available resources. More accurately, this is a misrepresentation of our access to available resources. (On a side note, I make this distinction on the realization that even if we have only used a small fraction of a seemingly infinite resource, this says nothing about how much of that resource will actually make it out of the mine so we have access to it; hence availability of a resource says nothing about our access to it.)

In purely thermodynamic terms, the zero-sum games does exist, but it just so happens to be on such a huge scale as to be, for all intents and purposes (in the near future), a non-issue. For example, a time when the zero-sum nature of economics becomes apparent is perhaps when we get ready to become a space faring species and leave the earth after digging up much of its resources; obviously an extreme example.

Even so, I see the integration of thermodynamics and economics as a natural symbiosis that will lead to much improved predictive power and models of future economies. Hence, let's not throw out the baby with the bath water-_-

 

[Ravi]

xsited1 is a physicist? I thought he was a Walmart greeter...damn, he must have gotten one of those on-line degrees.

 

[namaan]

xsited1 is a physicist? I thought he was a Walmart greeter...damn, he must have gotten one of those on-line degrees.

Haha, the thought did cross my mind...but I'm trying to not judge people's character's these days. If he says he's a physicist, I'll play along unless he says something ridiculous.

 

[code1211]

The OP is a rather poor attempt to basically say that for one to acquire wealth someone else must lose wealth. I suppose one can argue that from a simple transaction perspective, but it doesn't hold true over time. I'm not sure it's even true from an anologous perspective. After all the theory is that energy is finite and the subject is equating energy to the money supply. The money supply is not finite because we can print it. Not without consequence off course, but we indeed can make more of the stuff.

It would seem to me for the analogy to apply everyone would have to start life with a pre-set amount of money. For the theory to continue to apply through various transactions some would end up with all of the supply while some have none. Except that isn't how it works in reality. We all start life at zero money wise (someone go ahead and yell out trust fund baby, that's the exception, not the rule). And for the most part we all end up with more than zero. Some fluctuate and some just keep going up and up. I have a lot of theories on how wealth is accumulated, but I also know the notion that we are all simply exchanging a finite money supply simply is not true.

If I were so narrow-minded as to equate wealth with printed currency, I might be inclined to agree with you. Unfortunately I'm not, and your argument is decidedly non-compelling.

There is a reason that this is a philosophical discussion. Because, despite xsited1's failed attempts at ridicule, there is no way to prove the matter one way or the other. And in many ways, it comes down to what one truly believes wealth to be a measure of.

I disagree with that. Wealth, by its nature, is a purely man made thing. Value or potential may exist in nature, but wealth is something that only exists after men have had a hand in things.

Gold may have potential value or actual value, but it only exists as wealth if a group or a society agree that it represents wealth.

That said, other things like real estate, dwellings, vehicles and other posessions represent wealth. The population of the world was about 1 billion people in 1800 and is over 6 billion people now.

If wealth was a zero sum game and was only divided among people as opposed to being created, all people would on average be only 1 sixth as wealthy as people were in 1800. This is not likely. Obviously, wealth has been created in the mean time.

I wonder what a satelite array orbiting the Earth connecting every person via hand held communication devices would have sold for in 1800. Maybe an arsenal of Atomic weapons or one modern day car with air conditioning...

Wealth has expanded exponentially many times since 1800. It continues today.

 

[Procrustes Stretched]

I've been broke before and I've been semi-wealthy. I like being semi-wealthy the best. I seem to have more fun.

If you were unhappy while broke, being wealthier may have made you happier, but if you had a miserable outlook on life...that doen't change.

that said, I never cared for wealth. can't take it with me. It is nice to have access to, but I've always passed on having wealth own me and my mind. I'm happier without worries about losing that which is intangible.

 

[Procrustes Stretched]

Hey all,

I read the link posted by xsited1 ...

Coyote Blog » Blog Archive » Wealth Creation and the Zero-Sum Fallacy

The reason him being a physicist is important to me ..... Hence, let's not throw out the baby with the...

..let's not throw out the baby with the...with the manifold..

When the time comes, when the zero-sum nature of economics becomes apparent, we will be facing the extinguished universe.

There will come a time wheb we as a species realize we are not the center of things.

On the other hand there is obviously more going on than our limited senses in our limited brains are aware of...if indeed we are actully fully aware.

 

[Bern80]

The OP is a rather poor attempt to basically say that for one to acquire wealth someone else must lose wealth. I suppose one can argue that from a simple transaction perspective, but it doesn't hold true over time. I'm not sure it's even true from an anologous perspective. After all the theory is that energy is finite and the subject is equating energy to the money supply. The money supply is not finite because we can print it. Not without consequence off course, but we indeed can make more of the stuff.

It would seem to me for the analogy to apply everyone would have to start life with a pre-set amount of money. For the theory to continue to apply through various transactions some would end up with all of the supply while some have none. Except that isn't how it works in reality. We all start life at zero money wise (someone go ahead and yell out trust fund baby, that's the exception, not the rule). And for the most part we all end up with more than zero. Some fluctuate and some just keep going up and up. I have a lot of theories on how wealth is accumulated, but I also know the notion that we are all simply exchanging a finite money supply simply is not true.

If I were so narrow-minded as to equate wealth with printed currency, I might be inclined to agree with you. Unfortunately I'm not, and your argument is decidedly non-compelling.

There is a reason that this is a philosophical discussion. Because, despite xsited1's failed attempts at ridicule, there is no way to prove the matter one way or the other. And in many ways, it comes down to what one truly believes wealth to be a measure of.

You quoted the paragraph, not me. I can only surmise Perde is referring to the money supply as being anologous to wealth accumulation because no other measure of wealth (like assets for example) come even close to fitting into that theory.

If it is a definition of wealth you are looking for the most accepted one I'm aware of is based on one's net assets, that is essentially the value of everything they have.

 

[Bern80]

How can wealth not be created if I can use trees, which are virtually infinite and certainly renewable considering I can use their seeds to grow more, to build a house?

I can plant the seeds of an apple, and years down the road, I can have apples to eat and to sell.

In both of those cases, I have created wealth without destroying wealth because of the infinite nature of the sources to begin with.

I don't see why you think either of these are examples of creating wealth. These are examples of exploiting nature to improve your standard of living. I don't see why that would in any way be connected to worldwide wealth. That is, unless you think that wealth is synonymous with standard of living (like the dimwit blogger xsited1 linked). I do not. Correlated yes, but not remotely synonymous.

Now I'm starting to wonder why you even posted the Perde's article. How is the above NOT creating wealth, as oppossed to as argued by Perde a transfer of wealth)?

 

[Procrustes Stretched]

The OP is a rather poor attempt to basically say that for one to acquire wealth someone else must lose wealth. I suppose one can argue that from a simple transaction perspective, but it doesn't hold true over time. I'm not sure it's even true from an anologous perspective. After all the theory is that energy is finite and the subject is equating energy to the money supply. The money supply is not finite because we can print it. Not without consequence off course, but we indeed can make more of the stuff.

It would seem to me for the analogy to apply everyone would have to start life with a pre-set amount of money. For the theory to continue to apply through various transactions some would end up with all of the supply while some have none. Except that isn't how it works in reality. We all start life at zero money wise (someone go ahead and yell out trust fund baby, that's the exception, not the rule). And for the most part we all end up with more than zero. Some fluctuate and some just keep going up and up. I have a lot of theories on how wealth is accumulated, but I also know the notion that we are all simply exchanging a finite money supply simply is not true.

If I were so narrow-minded as to equate wealth with printed currency, I might be inclined to agree with you. Unfortunately I'm not, and your argument is decidedly non-compelling.

There is a reason that this is a philosophical discuss.....is no way to prove the matter one way or the other. And in many ways, it comes down to what one truly believes wealth to be a measure of.

I disagree with that. Wealth, by its nature, is a purely man made thing. Value or...tial may exist in nature, but wealth is something that only exists after men have had a hand in things.

Gold may have ...

A person can own a finite amount of things and one day be wealthier than the day before...all without adding or subtracting anything to their possesion.

 

[Procrustes Stretched]

really quite simple.

 

[midcan5]

I was trying to imagine a appropriately inept insane and scientific reply to this theory of theories. And thought it may have come from wonderland?

"`I wish I could manage to be glad!' the Queen said. `Only I never can remember the rule. You must be very happy, living in this wood, and being glad whenever you like!'

`Only it is so very lonely here!' Alice said in a melancholy voice; and, at the thought of her loneliness, two large tears came rolling down her cheeks.

`Oh, don't go on like that!' cried the poor Queen, wringing her hands in despair. `Consider what a great girl you are. Consider what a long way you've come to-day. Consider what o'clock it is. Consider anything, only don't cry!'

Alice could not help laughing at this, even in the midst of her tears. `Can you keep from crying by considering things?' she asked.

`That's the way it's done,' the Queen said with great decision: `nobody can do two things at once, you know. Let's consider your age to begin with -- how old are you?'

`I'm seven and a half, exactly.'

`You needn't say "exactly",' the Queen remarked. `I can believe it without that. Now I'll give you something to believe. I'm just one hundred and one, five months and a day.'

`I ca'n't believe that!' said Alice.

`Ca'n't you?' the Queen said in a pitying tone. `Try again: draw a long breath, and shut your eyes.'

Alice laughed. `There's no use trying,' she said `one ca'n't believe impossible things.'

`I daresay you haven't had much practice,' said the Queen. `When I was your age, I always did it for half-an-hour a day. Why, sometimes I've believed as many as six impossible things before breakfast."

Alice in Wonderland

 

[☭proletarian☭]

A friend and former co-worker of mine periodically sends me thread starting material (I confess, he comes up with the good stuff, not me. ). He is actually the person that got me into messageboards in the first place, but now he only likes to lurk and help out with a thread topic now and again. Until now, he has always requested that I take credit for whatever he sends me, and since it's usually pretty good, I do. But this time he's asked me to credit him. I didn't ask why, but I'm happy to oblige.

Note to mods: If this violates the rules in any way at all, I have no compunction whatsoever with going on record to state that Magus Perde is just a pseudonym I sometimes write under.

The Philosophy of Wealth Creation
by Magus Perde

It is my philosophical understanding that wealth cannot be created. I contend that wealth adheres to a law similar to the law of conservation of energy:

You're an idiot. Wealth is 'created' any time that a thing is considered more desirable. When one takes plants and makes a more highly valued clothing which is assigned a greater value, they have created wealth, as wealth is effectively a measure of the value of things.

See:

]The law of conservation of wealth, as it were, would state that the total amount of wealth worldwide (an isolated system) remains constant over time. A consequence of this law is that wealth cannot be created nor destroyed. The only thing that can happen to wealth in a closed system is that it can change form…and ownership.

You are an idiot and you clearly subscribe to the idiocy known as Intrinsic Value theory. Moron.

A perfect example is Saudi Arabia. Their wealth was not created by oil. They used an abundant and valuable natural resource to extract wealth from the rest of the world. Add to this the fact that the term wealth was once synonymous with welfare and the point becomes all the more salient.

That oil only 'wealth' so long as people assign value to it. Did it bring any wealth before the industrial revolution? Not really, because it was assigned little or no value compared to the value it's assigned today.

 

[☭proletarian☭]

Shouldn't this be in the humor section?

Sadly, some idiots take intrinsic value theory seriously.

 

[☭proletarian☭]

The OP is a rather poor attempt to basically say that for one to acquire wealth someone else must lose wealth.

I trade my squash, which I hate and you love for your carrots, which you dislike and I love.

We each get something we value more than that which we lost- we both increase our wealth. This is the ideal transaction in a market economy.