Do you agree with the following statement? Only "work" can create wealth.

[there4eyeM]

Refer back to the quotation from Lincoln.

 

[Mexicano]

If you want to read a book about creating wealth then read
The Richest Man in Babylon.

Stop erroneously using the King Midas fable as a story about creating wealth.

Net worth has only meaning within a complex value-added chain that can supply our hierarchy of needs. As long as the supply chain remains intact "net worth" is a meaningful concept. When there is a rupture in the supply chain and it can no longer provide for our needs the concept of "net worth" loses its meaning.

 

[MarathonMike]

You don't need the monetary system to be globally recognized, although it helps.
Have you ever heard about King Midas' golden touch?
Ahhh and fugazzi...

Your analogies of King Midas and the guy with two coconuts do not support your "work creating wealth" premise. If Ook the Caveman digs a hole and pulls out a shiny diamond has he created wealth? He worked hard to get the diamond. But uh oh! none of the other cavemen value it, and there is no concept of money.

 

[Blues Man]

Net worth has only meaning within a complex value-added chain that can supply our hierarchy of needs. As long as the supply chain remains intact "net worth" is a meaningful concept. When there is a rupture in the supply chain and it can no longer provide for our needs the concept of "net worth" loses its meaning.

Net worth has nothing to do with the supply chain.

Net worth is nothing but the monetary value of your assets minus the monetary value of the debt you carry.

The supply chain doesn't matter.

If you have 1 million dollars worth of gold bullion and owe 500K to various people your net worth is 500K no matter what the supply chain is doing.

If your home is paid off and worth 1 million and you owe no debt to anyone your net worth is 1 million regardless of the supply chain

 

[Mexicano]

Your analogies of King Midas and the guy with two coconuts do not support your "work creating wealth" premise. If Ook the Caveman digs a hole and pulls out a shiny diamond has he created wealth? He worked hard to get the diamond. But uh oh! none of the other cavemen value it, and there is no concept of money.

No, the caveman didn't create wealth... unless someone notices diamond is extremely hard and is useful as a cutting tool.
You need work to create wealth, that doesnt mean all work creates wealth. You may carry a rock at the top of Mt Everest , that's hard work but it doesn't create any wealth.
Also part of the work is aimed directly at consumption not at wealth creation. You harvest food, but food is perishable , so it has to be consumed before it rots and looses its value.

 

[MarathonMike]

You need work to create wealth, that doesnt mean all work creates wealth.

No matter how many times you repeat it, it doesn't make it right. You do not need work to create wealth unless you are talking in the most primitive terms such as the guy alone on an island gathering coconuts to survive is "wealthy".

 

[Mexicano]

No matter how many times you repeat it, it doesn't make it right. You do not need work to create wealth unless you are talking in the most primitive terms such as the guy alone on an island gathering coconuts to survive is "wealthy".

I didn't ever say "you" had to do the work or that your personal work is the only means to become wealthy.
- In the past slaves did the work for their owners
- You can also hire labor to work on your behalf
- Machines, with a source of energy can also perform work.
But at some point, something or someone has to do some work.

 

[Stryder50]

Not all work produces wealth. But I am not making that claim.

I am simply stating that no wealth can be created without work.

Well .... Duh!
If one applies a really broad definition of "work".
Such that even investment of Money, providing Capital, will "work" to grow Wealth.

 

[Stryder50]

Labor existed and created wealth for thousands of years before capital was invented.

The term/word itself, maybe. But ....
...
In economics, capital goods or capital are "those durable produced goods that are in turn used as productive inputs for further production" of goods and services.[1] At the macroeconomic level, "the nation's capital stock includes buildings, equipment, software, and inventories during a given year."[2]

A typical example is the machinery used in factories. Capital can be increased by the use of the factors of production, which however excludes certain durable goods like homes and personal automobiles that are not used in the production of saleable goods and services.

Adam Smith defined capital as "that part of man's stock which he expects to afford him revenue". In economic models, capital is an input in the production function. The total physical capital at any given moment in time is referred to as the capital stock (not to be confused with the capital stock of a business entity). Capital goods, real capital, or capital assets are already-produced, durable goods or any non-financial asset that is used in production of goods or services.[3]
...

Capital (economics) - Wikipedia

en.wikipedia.org

The first piece of chipped flint to use as a cutting tool, spear point, hatchet blade was "capital" of a sorts.

 

[Mexicano]

Well .... Duh!
If one applies a really broad definition of "work".
Such that even investment of Money, providing Capital, will "work" to grow Wealth.

"Investment" need still someone or something to work to build a product. By the by the only real investment is capex.
Buying crypto or non-ipo stock options do not count as investment.

 

[task0778]

"Buying crypto or non-ipo stock options do not count as investment."

Maybe it doesn't count for you, but it does for a lot of other people. But in any case, since those investments actually will create wealth for the investor, by your own definition other things besides work can create wealth.

 

[Stryder50]

I think you still have to add non-human energy : machines also create goods ( and provide some services like the internet) .
In fact in an industrial nation most of the wealth is created by machines.

And that points towards the problem of switching to green energy: the energy output will be the same , but we need to create goods with a complex supply chain ( wind turbines, solar panels, energy storage) in order to maintain the energy output at the same level.

Think "human activity" rather than "energy" then. Or think of "energy" in literal physics term.
The "Tools" part of the equation includes the "energy" needed to operate many of the tools.
Also, don't confuse energy generating devices/tools with the basic forms of energy.

 

[MarathonMike]

I didn't ever say "you" had to do the work or that your personal work is the only means to become wealthy.
- In the past slaves did the work for their owners
- You can also hire labor to work on your behalf
- Machines, with a source of energy can also perform work.
But at some point, something or someone has to do some work.

It's an interesting discussion the problem is, it's very abstract and requires very clear definition of "create" "work" and "wealth". Your thread title itself is problematic because as I pointed out "create wealth" is commonly used in investment circles, literature and books. You cannot deny that, it is easily verifiable.

 

[Mexicano]

It's an interesting discussion the problem is, it's very abstract and requires very clear definition of "create" "work" and "wealth". Your thread title itself is problematic because as I pointed out "create wealth" is commonly used in investment circles, literature and books. You cannot deny that, it is easily verifiable.

Well Mike, first let me thankyou for engaging in polite discussion.
Wealth is simplified by economists, because they need to quantify it. The problem with wealth is it linked to human needs and those needs are hierarchical.
- Breathing - absolute need
- Drinking water - without water we die in about 2 weeks
- Eating - absolute need
- Clothing- This one is actually tricky. On any tropical or temperate zone you are fine without clothing ... in Alaska or Siberia in winter you are in deep trouble.
- Shelter- Same as above

Hey , have you ever thought on colonizing Mars? Think on all the natural wealth we already have on Earth you just drop some seeds and they grow food!
Mars is a harsh place, there's no oxygen so they have to produce it using a machine :MOXIE. There's barely any water. Plants will need a sealed greenhouse.
And setting up this will require a lot of work. Want a novel perspective on wealth? Think as a Martian colonist.

Regarding the literature, if you have any specific sources, share them. I'll read them.

 

[Mexicano]

"Buying crypto or non-ipo stock options do not count as investment."

Maybe it doesn't count for you, but it does for a lot of other people. But in any case, since those investments actually will create wealth for the investor, by your own definition other things besides work can create wealth.

They will create a monetary flow if you are able to cash in before a crash. That's certain.
All financial wealth is dependent on the existence of supply chains. So far we have taken them for granted.
Those supply chains were disrupted during covid and we got inflation which deteriorated both the actual wealth and the financial wealth of many ( through inflation).

From the microeconomic perspective, you can simply assume those chains are working fine and assume financial wealth is real wealth.
From the macroeconomic and geostrategic and military perspectives, you can't. You have to consider the resources, transport chains, labor, and energy.

So it really depends on the task at hand: are you interested in getting rich personally? yes sure, financial assets can be seen as wealth.

Are you interested in making a whole country better off or ensuring an army is properly supplied for its task? Then the resource part is the most important.
One caveat: being the main reserve currency is some sort of wildcard. It allows you to exchange IOUs ( bills and bonds) for actual resources. So, in a globalized world that is actually a valuable asset ( even with its downsides).

Understanding Wealth: How Is It Defined and Measured?

Wealth measures the value of all assets of worth owned by a person, community, company, or country. Here, we discuss how to build and manage wealth.

www.investopedia.com

 

[MarathonMike]

Well Mike, first let me thankyou for engaging in polite discussion.
Wealth is simplified by economists, because they need to quantify it. The problem with wealth is it linked to human needs and those needs are hierarchical.
- Breathing - absolute need
- Drinking water - without water we die in about 2 weeks
- Eating - absolute need
- Clothing- This one is actually tricky. On any tropical or temperate zone you are fine without clothing ... in Alaska or Siberia in winter you are in deep trouble.
- Shelter- Same as above

Hey , have you ever thought on colonizing Mars? Think on all the natural wealth we already have on Earth you just drop some seeds and they grow food!
Mars is a harsh place, there's no oxygen so they have to produce it using a machine :MOXIE. There's barely any water. Plants will need a sealed greenhouse.
And setting up this will require a lot of work. Want a novel perspective on wealth? Think as a Martian colonist.

Regarding the literature, if you have any specific sources, share them. I'll read them.

Yes, so that is why I think perhaps a better term than "creation of wealth" might be "origination of wealth". Wealth origination IMO involves the physical creation of desired products, but more importantly a society with a monetary system, even if it's a barter system.

Sure, there could be massive wealth created on Mars just as it was created in America from the 1600s to today.

"Creating Wealth" is a famous book by Robert Allen that I read many years ago that is a good read.

 

[initforme]

I worked hard for over 40 years to support my family without giving the nation one thought.

 

[peacefan]

words have meanings,,

sorry just the way it is,,

oh ffs, words have different meanings according to different dictionaries!
and we all pick the definitions we like!
when we then go into verbal or even physical conflicts over our differences created by that differing set of definitions, it's called the "dictionary game".
and that can get quite "brutal".

 

[progressive hunter]

oh ffs, words have different meanings according to different dictionaries!
and we all pick the definitions we like!
when we then go into verbal or even physical conflicts over our differences created by that differing set of definitions, it's called the "dictionary game".
and that can get quite "brutal".

now whos nit picking??

sure isnt me,,