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Thread: Wealth Distribution in the USA

  1. #41
    Hot Message FDG's Avatar
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    Anyway, let us not confuse income with wealth - generally, income distributions are more equal than wealth ones (a natural consequence of decreasing marginal propensity to consume, since it will cause a more than proportional increase in the savings rate for a given increase in income).
    Obsequium amicos, veritas odium parit

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    Quote Originally Posted by William View Post
    I interpreted Jim's statement to be talking about the money supply. I didn't believe he is assuming anything related to the supply and demand, but rather simply the price increases if more money would be thrown into the system.
    Your interpretation is then fancy, because Jim, in his post: http://www.the16types.info/vbulletin...l=1#post947540 specifically talks about redistribuiting the existing wealth, not injecting exogenous money in the system.

    You also may not believe he is assuming anything, but his conclusions do, so there isn't a lot to talk about. If we talk about "throwing money into the system" then in most cases prices would increase, but then we're not really arguing any interesting point, and we especially are not talking about the argument I was debating in my post.

    It wouldn't change consumption. But prices would double. Increasing the money supply for those who demand beef would increase the price, FDG. And it would be close to double.
    The first part is obvious. The second: it would only double if all the additional exogenous income was used in the same proportion as the pre-existing part to buy additional beef. If you think so, then yes. May I instead think that there exists a satiation point for beef?

    suppliers would recognize the increase in the money supply
    How? Do they all personally know Ben Bernanke and Mario Draghi?

    and increase prices to obtain more profit.
    How do they know they would obtain more profit by DOUBLING the price.


    Basically both demand and supply would stay the same. We're simply talking about changing price levels. Have you ever played Monopoly with hundreds instead of thousands (and corresponding rents/prices of properties change proportionate to the level you play)? Or ever played with tens of thousands as opposed to simply thousands? The amount of money in supply does not change demand for certain items, but it would change the price of items. In a dynamic economy where suppliers control their prices, trying to maximize the amount they can earn, you could expect them to increase prices if people are able and willing to pay more.
    Doesn't work like that, Monopoly does not allow "savings" to exist after the game has ended. It's a one-shot game.

    William, I don't need any explanation from you on the matter. If you want to debate, bring your arguments (as Invisible Jim does), and don't just state them as facts.
    Obsequium amicos, veritas odium parit

  3. #43
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    Quote Originally Posted by FDG View Post
    Your interpretation is then fancy, because Jim, in his post: http://www.the16types.info/vbulletin...l=1#post947540 specifically talks about redistribuiting the existing wealth, not injecting exogenous money in the system.
    I was talking about income because aqua's post was about P20/P80 Income distributions FDG. If I typed Wealth, my bad that's my poor/average beef stew economics for you.

    You can help everyone to understand this topic better with your particular expertise. I would hope you are a treasure trove of statistics on the topic. For example you could correct Hkkmrs, useful but not the full story income distribution charts for the change in PPP over the years instead of inflation only.

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    Quote Originally Posted by William View Post
    Maybe my statements came across as factual, since I've been studying economics for years. Do you have any formal education in economics or any business experience?
    No, I smoke weed all day.
    Obsequium amicos, veritas odium parit

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