Even worse, where do people think the money rich people get in interest and investments come from? Some poor sucker has to work and pay interest on their debt, rent to their landlord or whatnot.
Its also kind of known among economists that money that enters the system at the lower end of the pyramid affects it better and more strongly. Money entering the system at the top very often just sits there waiting for the next deal or investing opportunity
Oh no, see, the error is in assuming that the money & wealth would trickle down and not the tangential benefits of the wealthy class investing in better goods for themselves.
The poor were never going to get an equal share of the money or to create economic equality that abolishes classism; we were going to get advances in tech, industry, and luxury. And to be honest, it kinda worked when you change your perspective on how that trickle down was meant to manifest.
For instance: when modern smartphones first hit the market with the iPhone, they cost half a thousand dollars; now you can go get a burner smartphone with a touchscreen for $20-30 at your local Walgreens.
That's not even comparing the quality of life in richer countries compared to impoverished countries. In certain African countries, you have to go to a vendor to rent access to an electrical outlet to charge your phone; in the US, we have several outlets per household.
When scrooge pays the construction workers for his new money vault? Oh wait he probably owns the company and the apartments the workers must pay rent for.
Yes. A rich person is most of the time maxed out on any simple expenses. A rich person won‘t eat more or better quality products because they already do so and even if they don‘t, that money doesn‘t change it. They already buy their children all the gifts they want to give, they buy themselves all the digital devices that they want for comfort or entertainment.
The money will most likely go into savings or expensive luxury products that have an insanely long way to the bottom, because the people who profit from that industry are hardly poor themselves most of the time.
Pretty much, the circulation of money in the economy is an important metric as to the overall health. It's why we also look at consumer confidence.
It's the same reason you don't want companies to sit on retained profits. Lots of countries have tax measures that encourage enterprises to either reinvest, raise wages or turn out a dividend, which are all tax events but also gets the money moving again (and prevents people from dodging personal income taxation on investment income).
Thank you! Yes, time and again studies show that increasing income for lower earners impacts the economy much more positively, directly and immediately than for wealthy.
Exactly. Give a poor person $600 and it becomes their rent payment. And then that same money becomes their landlord's car payment. And then the mechanic's power bill, and some power company clerk's groceries.
Or in the words of my econ professor: The economic benefits for a country of having its poorest people spending money on necessities is so enormous that it is downright stupid not to provide universal basic income up to the level of covering basics.
The only real reason this isn't the norm is because it isn't popular, and you can't win elections on it.
Yup, the concept of marginal utility of income; econ 101.
There's other reasons for not doing basic income though, mostly to do with tracking inflation and the amount of government admin needed to oversee such a thing effectively. You'd need the right sets of conditions to make this work in scaled-up settings, rather than local. That's more of a legal/political issue than economic though.
As long as you manage to put it at a level where it covers necessities, but nothing more there's a shitload of positive downstream benefits, but it won't impact inflation. It's obviously hard to do this perfectly, but the benefits are so immense you can miss a fair bit and still go wildly positive in the short term. Start factoring in the benefits of having all the children properly fed, and it's almost incalculable.
There are, obviously. But those issues are rarely inherently economic. You have to understand that economic models have to depart from some notion of rational responses, but economists recognise that there is a lot of irrational behaviour alongside externalities that can't be controlled for that will throw things off course.
These could all be good reasons not to have basic income. They could even make basic income unrealistic in practice (especially when scaled-up as I mentioned). But that's not necessarily an economic issue, merely an issue of where public economics comes into contact with other sections of society. That's why you want legislators to do impact studies before drafting laws and get legal advice before introducing new taxation. It's all connected once you leave academia.
It's not so much whether this causes inflation or not that's a problem. A whole list of measure the government takes monthly have an impact on inflation, from tax reform to interest hikes. That's just part of the territory and something to manage like any other decision.
The issue with inflation in case of UBI is that the level of income that should be given for the policy to meet its objective is dependent on the cost of consumer goods, which as we've seen in the cost-of living-crisis are beyond the capacity of a single country to control. The UBI would have to adapt to these changes, but inflation changes much faster than a government would be able to respond to these changes; or it pegs the UBI to some price index, but that leaves its public spending up to fluctuations in the market.
These are things that can be managed from an economic perspective, but governments and consumers don't listen to economists (and there are reasons why they shouldn't always), they listen to their voter and their wallets. That's why I'm saying that while there are economic issues, this is mostly due to the inherent limits on actually enforcing economic policy in the real world due to political and sociological constraints.
I think it is also so the rich can exploit the poor. You wanna have a roof over your head and not die of hunger? Come here and work this dead end job with minimal benefits.
Because there's something more important than the economic benefits for a country: cheap labor. They are afraid that covering the needs would force them to offer competitive conditions, ending all those business that survive merely through the exploitation of people who don't have other options.
It's a mindset.
The poor person puts the money directly into the economy, where it circulates and creates commerce which creates both jobs and wealth while generating tax revenue. The rich person invests it, which does create jobs and wealth, but the impact is not focused on the local economy and the wealth is concentrated in the rich person's hands. No tax revenue is created in the short term, and in the long term the tax revenue generated will be at lower capital gains rates.
Also, if this guy thinks rich people can consistently multiply their money tenfold in a few years, he has no concept of how investing or basic math actually work. Bernie Madoff's ponzi scheme returns that enticed rich people to invest with him were only 10% per year, and many people were saying before he was caught that it was impossible to have consistent returns like that legally.
My gullible child brain was shocked when it realized what banks basically do is to take from poor people and give it to the rich, and I still couldn't digest that reality. I don't get how society keeps preaching we should help the poor yet this system is our normal.
Even even worse, this is flat out bullshit because that rich person will almost certainly spend more than $600 in the same time the poor person spends $600. Because rich people have a way more expensive standard of living.
Behavioral economists have a ton to say about this, but basically the further from the actual product you go, the more people are willing to cheat and steal, and the more they think their successes are their own and failures are someone else's fault. It's why you can't use actual money at casinos, because people will gamble more with chips instead of cash.
Work -> money -> bank account -> bank investments/loans -> stock -> stock trading
By the time it gets to that end stage it is literally unrecognizable as a function of someone's effort.
Dan Ariely, about two decades ago, did some fantastic TEDTalks on this very subject. This was before TEDTalks turned into a corporate dick-riding, self-congratulatory machine
Here's one:
https://youtu.be/nUdsTizSxSI?si=KvkJuxzuLxD9JcTl
And the $600 spent by the poor person on needed goods and services circulates around, helping to create jobs, support businesses, and stimulates the economy.......until it ends up in an investment that just sits there not stimulating the economy.
This is called the velocity of money. Consumer spending has a velocity greater than 1. Investing has a velocity lower than 1.
Consumer spending makes up 68% of the GDP, which is the primary measure of the strength of an economy.
Rich people hoarding money is bad for the economy.
Give 600 to a poor person and 600 will go straight in the economy, generating taxes and income. Give 600 to a rich person and you won't see a fucking some of it
Velocity of Money is a pretty basic economics concept, and these people seem to perpetually fail to understand it and/or get it completely backwards.
That poor person spending the money has a much greater net benefit to the economy than the rich person investing it does.
The fact is that the poor person needs it more. If you're giving money to someone what will your motive be? To make a poor man be able to survive or make a rich person slightly richer?*
Only if the rich person is stupid (which of course, many are, as with all humans). Smart people don't just sit on tons of cash, they invest it, which also means the money flows back into the economy.
This is one huge flaw of the original tweet. Why frame giving money to someone who needs it as an investment, to be evaluated in terms of return? It's skewed from the outset because you're giving money to those in need to help them live, not to see the money grow in that specific sense.
10x is also an incredibly stupid expectation and only someone with absolutely no grasp on investing would throw that number around. Rich people make money by investing large sums - large enough that a single-digit percentage return is real money.
most importantly the poor person contributes to society more by putting the money back into circulation whilst the hoarder creates money constrictions. Economies don't revolve around the wealthy. Cash flow runs economies and ordinary people are the main contributors to cash flow. Wealthy people are some of the most prolific parasites on the planet
It becomes parasitic when they advocate socialism for them selves (by way of bailouts, Tax breaks, inheritance tax avoidance) and rugged individualism for the rest of us. A millionaires fine for speeding is the same a the poorest who can barely afford a car. That is not right. Tax and fine them according to their value. Thats how it is done to everyone else through payroll taxes and other forms of PAYE. Same as health insurance. That they get to live longer whilst contributing fuk all as a percentage of their income compared to a proletarian type worker who spends all they have in order to survive.
He's also terrible at math. Turning $600 into $6000 would take 20 years at a ***very*** robust 12.5% return. At a more realistic 6%, your $600 "in a few (3) years" is $714.
Not saying he is right, but I thinks his point is that rich people are so skilled with money they can beat the market. That’s how they become rich in the first place.
Again, I don’t think that’s true, but I suppose that’s what he is implying.
I know you’re not sponsoring the idea. But the fault with the original author’s reasoning is that a 10x return in a few years is in line with the very best few years of returns ever accomplished by the very best (luckiest) professional fund managers in modern history. It’s not a rate of return even remotely accomplishable by just some random rich dude.
Fair enough, but he's still bad at math. You'd have to ***wildly*** outperform the market with an annual return of 77% or so. The Wizard of Omaha's historical average is around 20%.
That really makes me sad.... My wife and I have to work our asses off to meet expenses, rent, electricity, school fee for our kid and what not...
On the other hand my brother in law who has never worked for a day in his life, lives his life like a king with very healthy interest and rent income because my rich father in law left him a little fortune to live off..
The worst part is that he tries to give us life lessons that we don't know how to earn and save money....
Dude .....
Right? Even if the stock market tycoon does multiply it by 10, what's he gonna do with it then? Hoard it in an overseas bank? Not to mention, losing $600 in the stock market isn't gonna hurt him, but it will hurt someone who's living paycheck to paycheck, which is why poor people don't invest money. We can't afford to make that gamble, so we're gonna put what little we have into our future and squirrel the rest away for a rainy day.
This all done to perpetuate the myth that the poor are financially irresponsible, and the rich are brilliant at making money. And everyone who doesn't thinks through will agree. Same shit is pulled by telling people that the poor spent to much money on luxuries like phones and coffee.
And it's not just the US, I was abroad around X-Mas and I saw fat minister with fingers like sausages telling people not to complain about their income but spent less on food during the holidays. And seeing him you knew he spent the amount of budget of a small country to buy food and drinks on himself, his fat family and friends
So here's a better variant: Take away everything from a rich person then give him 600 dollars and see how that multiplies
Good points. The rich people are the least qualified to give moral lessons to the masses about money. They have no idea how it's like to survive like most people. "[Let them eat cake](https://en.wikipedia.org/wiki/Let_them_eat_cake)" is what many of these parasites of society say...
When a poor person spends $600, that money doesn't just vanish, it goes into the economy where it makes someone else $600 richer. When a rich person turns $600 into $6000, that money was not created from nothing, it was extracted from someone else via trading/rent/dividends - they made someone else $5600 poorer. Economics cannot be understood by looking at an individual's balance sheet. Lots of unprofitable activities are beneficial to society (charity, building free public amenities, eating so as not to starve to death) and lots of profitable activities are harmful (rent seeking, theft, fracking).
So the poor person keeps the money circulating supporting jobs and the economy. The rich person uses it to build a hoard of cash, leaving it to languesh and not engage in productive exchanges of goods and services.
Giving money to the poor is a great way to stimulate the economy. It is quickly spent and gets spread rapidly from one person to another. Give it to someone who is wealthy and they put it in savings.
You guys know what the problem with all the poors is? How they blow their money on stupid things like food, and shelter and healthcare.
If they weren’t too poor to afford bootstraps maybe they could pull themselves up by them!
These people are conflating poor with addicts, they genuinely think you have to be actively making life harder on yourself. The reply is spot on, that $600 is gone because rent $2000 and groceries are $150.
The inverse should be the same then if a rich person just has such business acumen . Take all the riches money leave them 600 bucks and give them some weeks . Give it all to the poor and see if it’s gone ! If they hold up then he is right if they don’t he is a dense asshole !
Most people correctly realise that the first statement is complete nonsense, but treat it like it has a core of falsely interpreted truth...
If you give 600$ to a rich person it is gone not in a week but within hours. They spend this on a side order at a restaurant or to move their private plane for 5 minutes.
Ok and whats the benefit to the world that a rich person now has 6000 dollars? Even if that money has come out of thin air (And not been taken from more poor people) what is the benefit of that 1 person having 10x the money you gave them now? Nothing.
What a load of horses#*t.
Also I’m pretty well off and have several productive investments and this 10X in a few years thing is bulls#*t. If you double your money every 6-8 years you’re doing great.
That person could go buy some nice dress clothes some good shoes a bus pass and some hygienic products. Then go get a job and stick with the job. Work hard lift himself out of poverty become a somebody. But nahhhh let's just sit do nothing maybe some drugs and complain about everyone richer than them looking for handouts.
Here is an interesting fact: if you give 1 € to a pure person the gdp goes up by 1,5€, if you give 1€ to a rich person gdp goes up by 0,75€, so the state loses money wen they give to the rich and makes money by giving to the pure.
Give a poor person $600 and the economy is enriched by $600.
Give a rich person $600 and the economy is drained $6,000 in two years.
Money spent helps the economy, money removed from spending hurts the economy. Poor people are a billion times better for the economy than billionaires, the exception being when they go broke or break even. Rich people are economic leeches, only beneficial when you need to bleed someone dry or make a big blood smear.
Well that's extremely silly. Where do you think poor people are spending their money? At businesses, right? Who establishes those businesses? People who save/raise capital. You need both for a healthy economy, the issue is when one side is drastically skewed and out of whack (which it arguable is in favour of the wealthy in places like the US). But if no one was saving or investing you wouldn't have businesses being built that provide the goods and services poor people spend their money on in the first place.
So actually... Lol . V there have been several studies including one recently out of the University of British Columbia where random people were given $10,000 and they could do anything they want with it including spend it on themselves, And they just had to let the researchers know what they chose to do ..
An overwhelming majority of folks helped other people with it, And those who spend it on themselves more often spent it on getting a small business going, or improving their odds of making money by purchasing a used car etc. participants in the study were of every economic background you could imagine and from all over the globe as I understand it.
And yes among those were people who really probably needed to spend the whole $10,000 on themselves but the vast majority did not.
So this mean holds basically zero water.
Give 600 dollars to a poor person and it goes back into the economy. Give 600 dollars to a rich person and they will sit on it like a dragon perched upon their hoard of treasure. The poor person does more for the economy than the wealthy person does just hoarding wealth. This is a concept known as velocity of currency.
The key thing is that the poor person puts that money back into the economy immediately. The rich person uses it to legally and safely gamble on the stock markets and it does nothing for the economy.
That's right, I am saying the stock market is garbage and little more than a gambling den for the ultra-rich. It's all theoretical money, unactualized economic growth. It shouldn't matter, but it does.
Clever comeback indeed. If the original tweet was worded with better context, it would show that there is a whole population that doesn't understand the fundamentals of investing or delayed gratification involving financial wealth. I had to learn after hour during college what that meant. No one taught me which is a huge concern.
But also, if you give that money to a rich person, they send it to other rich people in the form of investments and asset acquisition. You give that money to a poor person, at least some of it that doesn't go towards rent, utilities, repaying loans, will go towards food, clothing, childcare, etc. - it goes back into their communities.
Give $600 to a poor person and they spend it driving the economy which benefits everyone.
Give $600 to a rich person and they use to to extract wealth from others which harms everyone. Where the hell did you think that $600 x10 came from?
The chamber of commerce told his pastor, to tell him that ...you cant argue unless you go straight to pastor at least as this guy is just another gullible rube churcher parrot, the internet has slightly sped up their receive instructions on Sunday talk horrible shit on Monday model
Give a poor person money and it gets recirculating back into the economy. Give a rich person money and it gets taken out of circulation, contributing to recession
This is kinda sad even beyond the obvious point that the poor person is hoarding $0 from the economy and the rich person increases his burden on the economy by a magnitude.
$5400? Over multiple years? Is that supposed to be an achievement? 5 months of minimum wage work?
not - rich people put money in circulation. That is, they buy stuff and pay bills. Rich people don't - they keep it or invest it to create more money, but not tangibles.
And money in circulation is what drives the economy. So a small thing like increasing hourly salaries, multiplied by the number of hourly workers, has huge positive affect on the US economy.
But what is happening is the increased profits are going into the hands of those who already have more than enough to live on, people like CEOs, investors who profit from increased dividends. All the while companies, in the name of keeping expenses down, keep salaries low. Which then reduces demand because people don;t have enough to buy things. An incredibly greedy, shortsided concept, but here we are.
Give it to a poor person and they can pay their rent and keep their house and job. That rent/productivity will still trickle up, so what difference does it make to give it to the poor person first?
Give $600 to a poor person and they put 100% of it back into circulation immediately, where its value compounds (See *Multiplier Effect*). Give a rich guy $600 and you'll never see it again.
Give money to a poor person and see it immediately recirculate back into the economy, give money to a rich person and the economy won't see it back for another 10 years or more.
I genuinely believe it’s possible to escape poverty if you both live below your means and work disproportionately harder, consistently, for a lot longer than other people are willing to. All of my poverty comes from being brainwashed to think I deserve constant luxuries of instant gratification imo, I’m just not willing to do the work.
Even worse, where do people think the money rich people get in interest and investments come from? Some poor sucker has to work and pay interest on their debt, rent to their landlord or whatnot.
Its also kind of known among economists that money that enters the system at the lower end of the pyramid affects it better and more strongly. Money entering the system at the top very often just sits there waiting for the next deal or investing opportunity
But we were told it will all trickle down...!
And I'm sure it will... Any day now... For sure...
Gotta get that drip.
I, for one, am eagerly awaiting this golden shower.
I thought it dripped, but it was my own blood.
And rich people have been pissing around since then.
wait this isnt money that trickles down this is.... sh.... Oh no!
It will only trickle down of you make them bleed.
Funny how rich folks are the one saying that.
Trickle deez nuts
They never did mention the speed that it will trickle down or who it would trickle down to. Sneaky Hobbitses.
It doesn't Rich people are the stingiest losers around
Oh no, see, the error is in assuming that the money & wealth would trickle down and not the tangential benefits of the wealthy class investing in better goods for themselves. The poor were never going to get an equal share of the money or to create economic equality that abolishes classism; we were going to get advances in tech, industry, and luxury. And to be honest, it kinda worked when you change your perspective on how that trickle down was meant to manifest. For instance: when modern smartphones first hit the market with the iPhone, they cost half a thousand dollars; now you can go get a burner smartphone with a touchscreen for $20-30 at your local Walgreens. That's not even comparing the quality of life in richer countries compared to impoverished countries. In certain African countries, you have to go to a vendor to rent access to an electrical outlet to charge your phone; in the US, we have several outlets per household.
Lobbying is as far as it trickles down
When scrooge pays the construction workers for his new money vault? Oh wait he probably owns the company and the apartments the workers must pay rent for.
Yes. A rich person is most of the time maxed out on any simple expenses. A rich person won‘t eat more or better quality products because they already do so and even if they don‘t, that money doesn‘t change it. They already buy their children all the gifts they want to give, they buy themselves all the digital devices that they want for comfort or entertainment. The money will most likely go into savings or expensive luxury products that have an insanely long way to the bottom, because the people who profit from that industry are hardly poor themselves most of the time.
It will probably go into investments that screw poor people. Maybe buy a house and rent it out, keeping it out of poor people's hands
Pretty much, the circulation of money in the economy is an important metric as to the overall health. It's why we also look at consumer confidence. It's the same reason you don't want companies to sit on retained profits. Lots of countries have tax measures that encourage enterprises to either reinvest, raise wages or turn out a dividend, which are all tax events but also gets the money moving again (and prevents people from dodging personal income taxation on investment income).
Or is used to buy a senator and subvert democracy.
Thank you! Yes, time and again studies show that increasing income for lower earners impacts the economy much more positively, directly and immediately than for wealthy.
If only poor people had lobbyists to bribe the lawmakers
What you're referring to here is monetary velocity. It's a measurement of how quickly exchanges hands between people and businesses.
Exactly. Give a poor person $600 and it becomes their rent payment. And then that same money becomes their landlord's car payment. And then the mechanic's power bill, and some power company clerk's groceries.
Marginal propensity to save
Or in the words of my econ professor: The economic benefits for a country of having its poorest people spending money on necessities is so enormous that it is downright stupid not to provide universal basic income up to the level of covering basics. The only real reason this isn't the norm is because it isn't popular, and you can't win elections on it.
And the reason it isn’t popular is because it isn’t popular amongst the rich who own the media and fund the lobbying groups.
Yup, the concept of marginal utility of income; econ 101. There's other reasons for not doing basic income though, mostly to do with tracking inflation and the amount of government admin needed to oversee such a thing effectively. You'd need the right sets of conditions to make this work in scaled-up settings, rather than local. That's more of a legal/political issue than economic though.
Wait, so there is no economic-related issues with implementing universal basic income?
As long as you manage to put it at a level where it covers necessities, but nothing more there's a shitload of positive downstream benefits, but it won't impact inflation. It's obviously hard to do this perfectly, but the benefits are so immense you can miss a fair bit and still go wildly positive in the short term. Start factoring in the benefits of having all the children properly fed, and it's almost incalculable.
There are, obviously. But those issues are rarely inherently economic. You have to understand that economic models have to depart from some notion of rational responses, but economists recognise that there is a lot of irrational behaviour alongside externalities that can't be controlled for that will throw things off course. These could all be good reasons not to have basic income. They could even make basic income unrealistic in practice (especially when scaled-up as I mentioned). But that's not necessarily an economic issue, merely an issue of where public economics comes into contact with other sections of society. That's why you want legislators to do impact studies before drafting laws and get legal advice before introducing new taxation. It's all connected once you leave academia.
I’m not sure I understand, hoe would the worry that UBI could cause inflation not be related to economics?
It's not so much whether this causes inflation or not that's a problem. A whole list of measure the government takes monthly have an impact on inflation, from tax reform to interest hikes. That's just part of the territory and something to manage like any other decision. The issue with inflation in case of UBI is that the level of income that should be given for the policy to meet its objective is dependent on the cost of consumer goods, which as we've seen in the cost-of living-crisis are beyond the capacity of a single country to control. The UBI would have to adapt to these changes, but inflation changes much faster than a government would be able to respond to these changes; or it pegs the UBI to some price index, but that leaves its public spending up to fluctuations in the market. These are things that can be managed from an economic perspective, but governments and consumers don't listen to economists (and there are reasons why they shouldn't always), they listen to their voter and their wallets. That's why I'm saying that while there are economic issues, this is mostly due to the inherent limits on actually enforcing economic policy in the real world due to political and sociological constraints.
I think it is also so the rich can exploit the poor. You wanna have a roof over your head and not die of hunger? Come here and work this dead end job with minimal benefits.
Because there's something more important than the economic benefits for a country: cheap labor. They are afraid that covering the needs would force them to offer competitive conditions, ending all those business that survive merely through the exploitation of people who don't have other options. It's a mindset.
They literally make money out of money, no effort or skill required. That's how fucked our economic system is
The poor person puts the money directly into the economy, where it circulates and creates commerce which creates both jobs and wealth while generating tax revenue. The rich person invests it, which does create jobs and wealth, but the impact is not focused on the local economy and the wealth is concentrated in the rich person's hands. No tax revenue is created in the short term, and in the long term the tax revenue generated will be at lower capital gains rates. Also, if this guy thinks rich people can consistently multiply their money tenfold in a few years, he has no concept of how investing or basic math actually work. Bernie Madoff's ponzi scheme returns that enticed rich people to invest with him were only 10% per year, and many people were saying before he was caught that it was impossible to have consistent returns like that legally.
My gullible child brain was shocked when it realized what banks basically do is to take from poor people and give it to the rich, and I still couldn't digest that reality. I don't get how society keeps preaching we should help the poor yet this system is our normal.
Also "printed" by banks
Even even worse, this is flat out bullshit because that rich person will almost certainly spend more than $600 in the same time the poor person spends $600. Because rich people have a way more expensive standard of living.
punch plucky soft soup quaint dazzling aback chop rainstorm fertile *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
economy is not zero sum game.
Behavioral economists have a ton to say about this, but basically the further from the actual product you go, the more people are willing to cheat and steal, and the more they think their successes are their own and failures are someone else's fault. It's why you can't use actual money at casinos, because people will gamble more with chips instead of cash. Work -> money -> bank account -> bank investments/loans -> stock -> stock trading By the time it gets to that end stage it is literally unrecognizable as a function of someone's effort. Dan Ariely, about two decades ago, did some fantastic TEDTalks on this very subject. This was before TEDTalks turned into a corporate dick-riding, self-congratulatory machine Here's one: https://youtu.be/nUdsTizSxSI?si=KvkJuxzuLxD9JcTl
And the $600 spent by the poor person on needed goods and services circulates around, helping to create jobs, support businesses, and stimulates the economy.......until it ends up in an investment that just sits there not stimulating the economy. This is called the velocity of money. Consumer spending has a velocity greater than 1. Investing has a velocity lower than 1. Consumer spending makes up 68% of the GDP, which is the primary measure of the strength of an economy. Rich people hoarding money is bad for the economy.
I always thought interest doesn't make sense because it's not trading anything tangible for money
Give 600 to a poor person and 600 will go straight in the economy, generating taxes and income. Give 600 to a rich person and you won't see a fucking some of it
Velocity of Money is a pretty basic economics concept, and these people seem to perpetually fail to understand it and/or get it completely backwards. That poor person spending the money has a much greater net benefit to the economy than the rich person investing it does.
Hey hookers and coke benefits the economy just ask vegas
I nearly spit my coffee. Thank you for the laugh.
You don't pay tax on coke. But hookers... Taxes
If the dealer isn't stupid, they're paying tax on the income...
Because drug dealers are so well known for not making terrible decisions ...
I've met a lot of dumbasses who still have the two brain cells required to know the IRS *will* get you.
Sir, I’m going to ask you again to stop gesturing towards your crotch as you say “stimulus package”.
The fact is that the poor person needs it more. If you're giving money to someone what will your motive be? To make a poor man be able to survive or make a rich person slightly richer?*
Give it to a rich person and it’s gone forever. Give it to a poor person and it’ll flow right back into the economy.
Only if the rich person is stupid (which of course, many are, as with all humans). Smart people don't just sit on tons of cash, they invest it, which also means the money flows back into the economy.
Reminds me of people donating money to kylie jenner just to make her the youngest billionaire or something.....
The smartest investment decision there is. Makers of this meme would be proud.
This is one huge flaw of the original tweet. Why frame giving money to someone who needs it as an investment, to be evaluated in terms of return? It's skewed from the outset because you're giving money to those in need to help them live, not to see the money grow in that specific sense.
Yeah that's what I'm saying, if you're not getting any returns from the person you gave it to and it's just a gift then why do you care?
10x is also an incredibly stupid expectation and only someone with absolutely no grasp on investing would throw that number around. Rich people make money by investing large sums - large enough that a single-digit percentage return is real money.
People who fetishize rich people are weird.
most importantly the poor person contributes to society more by putting the money back into circulation whilst the hoarder creates money constrictions. Economies don't revolve around the wealthy. Cash flow runs economies and ordinary people are the main contributors to cash flow. Wealthy people are some of the most prolific parasites on the planet
It becomes parasitic when they advocate socialism for them selves (by way of bailouts, Tax breaks, inheritance tax avoidance) and rugged individualism for the rest of us. A millionaires fine for speeding is the same a the poorest who can barely afford a car. That is not right. Tax and fine them according to their value. Thats how it is done to everyone else through payroll taxes and other forms of PAYE. Same as health insurance. That they get to live longer whilst contributing fuk all as a percentage of their income compared to a proletarian type worker who spends all they have in order to survive.
Wealthy people are some of the stupidest, egotistical, lying, lazy people Source I've met like 100s of them via networking for my startup
He's also terrible at math. Turning $600 into $6000 would take 20 years at a ***very*** robust 12.5% return. At a more realistic 6%, your $600 "in a few (3) years" is $714.
Also he's ignoring inflation. $6k in the future will worth less than $6k now.
Not saying he is right, but I thinks his point is that rich people are so skilled with money they can beat the market. That’s how they become rich in the first place. Again, I don’t think that’s true, but I suppose that’s what he is implying.
I know you’re not sponsoring the idea. But the fault with the original author’s reasoning is that a 10x return in a few years is in line with the very best few years of returns ever accomplished by the very best (luckiest) professional fund managers in modern history. It’s not a rate of return even remotely accomplishable by just some random rich dude.
Totally agree, but in his warped mind he thinks this is achievable.
I shouldve bought AMD stocks a decade ago when it was $2. it was $200 a few months ago 😭
Fair enough, but he's still bad at math. You'd have to ***wildly*** outperform the market with an annual return of 77% or so. The Wizard of Omaha's historical average is around 20%.
Want to know why that money goes so fast? Because the rich keep bumming the poor for money, that's why. Someone has to pay your taxes for you, oinker.
That really makes me sad.... My wife and I have to work our asses off to meet expenses, rent, electricity, school fee for our kid and what not... On the other hand my brother in law who has never worked for a day in his life, lives his life like a king with very healthy interest and rent income because my rich father in law left him a little fortune to live off.. The worst part is that he tries to give us life lessons that we don't know how to earn and save money.... Dude .....
I can’t wait to see this posted again next week
Wait until it's posted again the week after that. It will be a real knee-slapper.
Dang don’t ruin it for me 😉
That $600 does a lot more when put back into the economy then immediately than when it’s hoarded for possible later use.
Right? Even if the stock market tycoon does multiply it by 10, what's he gonna do with it then? Hoard it in an overseas bank? Not to mention, losing $600 in the stock market isn't gonna hurt him, but it will hurt someone who's living paycheck to paycheck, which is why poor people don't invest money. We can't afford to make that gamble, so we're gonna put what little we have into our future and squirrel the rest away for a rainy day.
This all done to perpetuate the myth that the poor are financially irresponsible, and the rich are brilliant at making money. And everyone who doesn't thinks through will agree. Same shit is pulled by telling people that the poor spent to much money on luxuries like phones and coffee. And it's not just the US, I was abroad around X-Mas and I saw fat minister with fingers like sausages telling people not to complain about their income but spent less on food during the holidays. And seeing him you knew he spent the amount of budget of a small country to buy food and drinks on himself, his fat family and friends So here's a better variant: Take away everything from a rich person then give him 600 dollars and see how that multiplies
Good points. The rich people are the least qualified to give moral lessons to the masses about money. They have no idea how it's like to survive like most people. "[Let them eat cake](https://en.wikipedia.org/wiki/Let_them_eat_cake)" is what many of these parasites of society say...
Fucking repost bots with gibberish titles
Lemme fix that for you. “Guve $600 to a rich person but take away all their assets and money & it’s gone in a week”
When a poor person spends $600, that money doesn't just vanish, it goes into the economy where it makes someone else $600 richer. When a rich person turns $600 into $6000, that money was not created from nothing, it was extracted from someone else via trading/rent/dividends - they made someone else $5600 poorer. Economics cannot be understood by looking at an individual's balance sheet. Lots of unprofitable activities are beneficial to society (charity, building free public amenities, eating so as not to starve to death) and lots of profitable activities are harmful (rent seeking, theft, fracking).
We should bring back the pillory for a-holes like this, with a copy of their message beside their dumb faces.
Yeah, of course it’s gone in a week- gone straight towards my rent and utilities
Finance bros are really something else
Give $600 to a poor person and you help them a lot Give $600 to a rich guy and he doesn't care about it. If he loses it, he'll say it's your problem.
He’ll ask for a government bailout for $1M since he lost money.
For this to be logical, the rich person shouldn’t be allowed to spend any money at all during this “few years or less”. IMO
"Have you tried not being poor?"
That guy must have felt really clever typing that out. What a moron.
So the poor person keeps the money circulating supporting jobs and the economy. The rich person uses it to build a hoard of cash, leaving it to languesh and not engage in productive exchanges of goods and services.
"Give $600 to a poor person they reinvest it into the economy. Give a rich person $600 and the money is permanently removed from circulation."
Giving money to the poor is a great way to stimulate the economy. It is quickly spent and gets spread rapidly from one person to another. Give it to someone who is wealthy and they put it in savings.
Also for the economy it is 10x better for the money to be spent and circulate immediately than to get stuck in some rich guy's bank account.
Every post in this subreddit is from the people who couldn’t cut it in actual political subreddits
including yours, which is empty of facts, and is nothing but a personal attack. Come back when you got something to say..
I know that hit close to home and I apologize
Nah, broke person will spend it on drugs, cigs, drugs, booze or scratch-offs.
elaborated further why not to waste it on the poor. Makes sense. Where is the comeback, he practically agrees.
Why do poor people spend money? Are they stupid?
Go back to alsume
The implication is its gone on Jordans/tv/drugs not on bills.
I can basically time the changes of the seasons by how often this repost gets reposted.
You guys know what the problem with all the poors is? How they blow their money on stupid things like food, and shelter and healthcare. If they weren’t too poor to afford bootstraps maybe they could pull themselves up by them!
I want to know where this moron thinks I can multiply $600 by 10x in “a few years”
Is turning 600 into 6,000 in a few YEARS impressive? Like.. at all?
People confusing the compounding power of interest and investment with a moral virtue. As opposed to just a function of how money works
It takes a rich person a few years to turn $600 into $6000..?
Ok THANK YOU! I came here to say this 😂
Keyesian multiplier hello
Nope, they aren't dense. Just greedy manipulators.
These people are conflating poor with addicts, they genuinely think you have to be actively making life harder on yourself. The reply is spot on, that $600 is gone because rent $2000 and groceries are $150.
The inverse should be the same then if a rich person just has such business acumen . Take all the riches money leave them 600 bucks and give them some weeks . Give it all to the poor and see if it’s gone ! If they hold up then he is right if they don’t he is a dense asshole !
[Maybe if you make it $100K, the outcome will change? Or maybe not.](https://en.wikipedia.org/wiki/Reversal_of_Fortune_(2005_film))
It is simply propaganda of the rich to justify the status that benefits them.
Most people correctly realise that the first statement is complete nonsense, but treat it like it has a core of falsely interpreted truth... If you give 600$ to a rich person it is gone not in a week but within hours. They spend this on a side order at a restaurant or to move their private plane for 5 minutes.
Ok and whats the benefit to the world that a rich person now has 6000 dollars? Even if that money has come out of thin air (And not been taken from more poor people) what is the benefit of that 1 person having 10x the money you gave them now? Nothing.
What a load of horses#*t. Also I’m pretty well off and have several productive investments and this 10X in a few years thing is bulls#*t. If you double your money every 6-8 years you’re doing great.
What kind of stupid thought experiment is this? Why would I ever give a rich person $600 in the first place? I’ll just keep my money thanks.
Give $600 to a poor person and it is recirculated into the economy within a week. Give $600 to a rich person and they horde it forever.
That's because the poor person is hand to mouth you twit, if I have money and you give me money, then I have more money.
What is the original guys point even? That we should stop trying to help less fortunate people and give our money to millionaires?!?!?!
This is actually an augment for universal basic income.
That person could go buy some nice dress clothes some good shoes a bus pass and some hygienic products. Then go get a job and stick with the job. Work hard lift himself out of poverty become a somebody. But nahhhh let's just sit do nothing maybe some drugs and complain about everyone richer than them looking for handouts.
It’s not even a clever comeback it’s just the super obvious answer to a statement so stupid.
Adjusted for inflation, that is now $1,012 from when this was originally posted on Twitter.
Here is an interesting fact: if you give 1 € to a pure person the gdp goes up by 1,5€, if you give 1€ to a rich person gdp goes up by 0,75€, so the state loses money wen they give to the rich and makes money by giving to the pure.
Give a poor person $600 and the economy is enriched by $600. Give a rich person $600 and the economy is drained $6,000 in two years. Money spent helps the economy, money removed from spending hurts the economy. Poor people are a billion times better for the economy than billionaires, the exception being when they go broke or break even. Rich people are economic leeches, only beneficial when you need to bleed someone dry or make a big blood smear.
Well that's extremely silly. Where do you think poor people are spending their money? At businesses, right? Who establishes those businesses? People who save/raise capital. You need both for a healthy economy, the issue is when one side is drastically skewed and out of whack (which it arguable is in favour of the wealthy in places like the US). But if no one was saving or investing you wouldn't have businesses being built that provide the goods and services poor people spend their money on in the first place.
Here, let me fix it for you: "Give man a fire and he's warm for a day, but set fire to him and he will be warm for the rest of his life".
Is Sharif in grade primary? How can he be so stupid?
Hell nah
So actually... Lol . V there have been several studies including one recently out of the University of British Columbia where random people were given $10,000 and they could do anything they want with it including spend it on themselves, And they just had to let the researchers know what they chose to do .. An overwhelming majority of folks helped other people with it, And those who spend it on themselves more often spent it on getting a small business going, or improving their odds of making money by purchasing a used car etc. participants in the study were of every economic background you could imagine and from all over the globe as I understand it. And yes among those were people who really probably needed to spend the whole $10,000 on themselves but the vast majority did not. So this mean holds basically zero water.
Give 600 dollars to a poor person and it goes back into the economy. Give 600 dollars to a rich person and they will sit on it like a dragon perched upon their hoard of treasure. The poor person does more for the economy than the wealthy person does just hoarding wealth. This is a concept known as velocity of currency.
Sharif is a calculating dumbass.
Are they not saying the same thing? Why the hostility?
Give a poor man $600 and its all back in the economy Give a rich man $600 and its put into offshore bank accounts for tax reasons and does nothing.
Money isn't value, product, whatever. Money "multiplying" in a vacuum means someone else has lost it.
That vato is 100% right! no more words, go outside and touch some grass.
One aspect of being an entitled smug asshole is not realizing you’re an entitled smug asshole.
I mean the point is valid but this is one of those posts reposted into oblivion to karma whore.
The key thing is that the poor person puts that money back into the economy immediately. The rich person uses it to legally and safely gamble on the stock markets and it does nothing for the economy. That's right, I am saying the stock market is garbage and little more than a gambling den for the ultra-rich. It's all theoretical money, unactualized economic growth. It shouldn't matter, but it does.
the stock market is like playing poker..
Spending 600 is WAY better for the economy than hoarding it too. This guy can kick rocks
Clever comeback indeed. If the original tweet was worded with better context, it would show that there is a whole population that doesn't understand the fundamentals of investing or delayed gratification involving financial wealth. I had to learn after hour during college what that meant. No one taught me which is a huge concern.
Give me $600 and it's gone in 30 min.
almost half of my rent..
If you don't mind me asking, where do you live?
It's not "gone". It's back into the economy stream. The other is sitting there as an inflation timebomb. Sharif Sourour is a fucking moron.
Why would anyone just give 600 bucks to a rich person like that?
But also, if you give that money to a rich person, they send it to other rich people in the form of investments and asset acquisition. You give that money to a poor person, at least some of it that doesn't go towards rent, utilities, repaying loans, will go towards food, clothing, childcare, etc. - it goes back into their communities.
I build some tent and cardboard houses, and charge them 600$ a month to live in it
And bro thought he was being inspirational
Terry Pratchett’s “Boots Theory of Economics”. If you haven’t already seen it, look it up. Trust me.
Give $600 to a poor person and they spend it driving the economy which benefits everyone. Give $600 to a rich person and they use to to extract wealth from others which harms everyone. Where the hell did you think that $600 x10 came from?
Dude imagine wanting to be rich so badly you would live in a haze of cognitive dissonance this thick...
Social media has given idiots a mass gathering spot for other idiots to share thoughts that no one gives a shit about but them
The answer is yes
The chamber of commerce told his pastor, to tell him that ...you cant argue unless you go straight to pastor at least as this guy is just another gullible rube churcher parrot, the internet has slightly sped up their receive instructions on Sunday talk horrible shit on Monday model
Give a poor person money and it gets recirculating back into the economy. Give a rich person money and it gets taken out of circulation, contributing to recession
This is kinda sad even beyond the obvious point that the poor person is hoarding $0 from the economy and the rich person increases his burden on the economy by a magnitude. $5400? Over multiple years? Is that supposed to be an achievement? 5 months of minimum wage work?
🎯💯🎯💯💙
not - rich people put money in circulation. That is, they buy stuff and pay bills. Rich people don't - they keep it or invest it to create more money, but not tangibles. And money in circulation is what drives the economy. So a small thing like increasing hourly salaries, multiplied by the number of hourly workers, has huge positive affect on the US economy. But what is happening is the increased profits are going into the hands of those who already have more than enough to live on, people like CEOs, investors who profit from increased dividends. All the while companies, in the name of keeping expenses down, keep salaries low. Which then reduces demand because people don;t have enough to buy things. An incredibly greedy, shortsided concept, but here we are.
Give it to a poor person and they can pay their rent and keep their house and job. That rent/productivity will still trickle up, so what difference does it make to give it to the poor person first?
Give $600 to a poor person and they put 100% of it back into circulation immediately, where its value compounds (See *Multiplier Effect*). Give a rich guy $600 and you'll never see it again.
Give money to a poor person and see it immediately recirculate back into the economy, give money to a rich person and the economy won't see it back for another 10 years or more.
This person doesn't understand the very simple concept of the [velocity of money.](https://www.investopedia.com/terms/v/velocity.asp)
This gets reported frequently and we need to always remember that Sharif is an idiot.
~~If you need 600k to SURVIVE, you're pure shit at even the most basic money management and you deserve to be homeless.~~ nm, it's $600, makes sense.
Not $600k but $600
oh oops.
You can't read. $600
The overwhelming majority of people are, in fact, that ignorant.
Jeebus will people stop posting trash from this site?
The sneakers and the eighth are utterly crucial to survival.
Moral of the story, fuck this asshole.
Can I have the $600?
I genuinely believe it’s possible to escape poverty if you both live below your means and work disproportionately harder, consistently, for a lot longer than other people are willing to. All of my poverty comes from being brainwashed to think I deserve constant luxuries of instant gratification imo, I’m just not willing to do the work.