Is there a benefit to racism?

[Bengalzona]

(08-15-2018, 09:36 AM)Belsnickel Wrote: Those things are all valued based upon the estimate that someone is willing to pay for them. Your wealth in those sorts of assets is predicated on the idea that you will be taking money from someone else. The assessed value of your home or the stock valuation of your portfolio is nothing more than some finance person saying "I can make someone pay this amount for this thing to get you money."

You realize that value of your portfolio when you sell, hopefully at a high point, at which point someone will purchase those stocks and, if you did things right, lose value on them because you sold at a high point. You've now created a loser out of the person that purchased those stocks.

Your home's value works in very much the same way. The real value of the home is in the materials that make it up and what is inside of it. Anything beyond that is just speculation on what someone will pay for it. The added value isn't tangible and can be lost at any time. There are a variety of reasons to sell, but the same principal exists in real estate as it does in stocks. You sell to increase your money, hopefully at a high point in the market. If you sell at a high point in the market, then the person that buys will lose out when the market decreases.

Capitalism.

Seriously though, as an accountant, this is the way we tend to think about things. The world of finance is all about this sort of stuff. You get to see how the sausage is made in a free market.

It is interesting. You would think that after the Bush-era recession and housing market collapse, people would realize that there are points where "the winning" stops and the piper has to be paid. But human nature is such that people do not want to believe that anymore. And our culture in the U.S. is built around reinforcing the gambler's illusions.

Isn't the concept of wealth also related to the concept of scarcity? (Which, in itself, indicates winners and losers.)

[Bengalzona]

(08-15-2018, 09:54 AM)Belsnickel Wrote: The moving parts to all of this are massive and complex.

But the concepts are basic. The mechanism is only made to look intimidating and scary. It is like the "wizard" in the Wizard of Oz.

[*michaelsean*]

(08-15-2018, 10:12 AM)Bengalzona Wrote: It is interesting. You would think that after the Bush-era recession and housing market collapse, people would realize that there are points where "the winning" stops and the piper has to be paid. But human nature is such that people do not want to believe that anymore. And our culture in the U.S. is built around reinforcing the gambler's illusions.

Isn't the concept of wealth also related to the concept of scarcity?

Certainly you can lose wealth, and there aren't necessarily any winners when you do.

[GMDino]

(08-15-2018, 10:18 AM)michaelsean Wrote: Certainly you can lose wealth, and there aren't necessarily any winners when you do.

Sure there are.  There are people (some sitting in an elected office right now) who bank big on the economy dropping or things going bad.  They will play the system and make their money.

[*michaelsean*]

(08-15-2018, 10:25 AM)GMDino Wrote: Sure there are.  There are people (some sitting in an elected office right now) who bank big on the economy dropping or things going bad.  They will play the system and make their money.

There can be but it's not inherent in the system.  

[Belsnickel]

(08-15-2018, 10:28 AM)michaelsean Wrote: There can be but it's not inherent in the system.  

Speculative markets aren't inherent in the system, either, but that's all we have been discussing. However, if there are speculative markets people speculating a drop in the market will be inherent to that system.

[Dill]

(08-15-2018, 09:24 AM)Belsnickel Wrote: I think you are seeing the disconnect that a lot of people seem to have regarding capitalism. With a free market, there are going to be winners and losers. The winners win at the expense of the losers. This is the entire premise of capitalism and it doesn't work without it. A winner is taking wealth from the loser through business practices, both legal and illegal, to increase their own holdings. Why people try to deny this basic tenant of capitalism is beyond me.

Yes, and I agree with that you say about winners and losers. I would only add:

A capitalist would answer by saying that captialism produces more wealth than any other mode of production. There may be "zero sum" at given moments, such as the entry to recession, but otherwise the process of production is such that it may simultaneaously produce more for both winners and "losers."  Poor people today have much more wealth than poor of 100 years ago, everyone is finally a winner under capitalism. A guy who manufactures a better farm tractor may reduce the profits of, or even bankrupt, another manufacturer, but many farmers and consumers benefit from more efficient farming.  Some losers, sure, but more winners and better products and services overall because of "competition." The less you know about the history of capitalism, the more reasonable and accurate this view seems. In the 19th century people made easy analogies to evolution and "the survival of the fittest" to justify minimal government--losers are "natural" and should not get handouts--except to break unions, to oppose the collective efforts people began undertaking to increase wages, to safeguard workers and their families, and to protect the environment.

I am not a capitalist, though. I agree with Marx: it is a structural requirement of capitalism that there be a mass of wage laborers who have nothing to sell but their labor; this mass, with nothing else to trade, enters into a "contract" with the capitalist to labor for him at the wages he sets--normally as low as the market will bear.  Capitalism produces this mass over time by depriving the many of land and other means of independent subsistence and concentrating these in the hands of a few.   These "losers" then are "free to chose" which employer they will serve.  They are "successfull" when they get good jobs and promotions. Over time, workers tend to adopt the class viewpoint of their employers, defending their rights over workers rights (at least in countries like the US, where there is little to no political left) as if the "contract" between employers and employees were equal, made between equally empowered individuals.

It is also a structural requirement that businesses in this system produce a profit; the livelihood of owners and managers depends upon this. Businesses cannot just maintain equilibrium and survive. They must expand.  And this imperative then drives their policies regarding issues like worker safety and the environment--always a choice between these "goods" and profits. Their horizon becomes increasingly short-term and exceedingly self-interested.

[Dill]

(08-15-2018, 10:18 AM)michaelsean Wrote: Certainly you can lose wealth, and there aren't necessarily any winners when you do.

Your barn burns down and your cattle all get hoof and mouth disease.  Total loss. 

It would seem there are no winners. But the price of your neighbors cattle may go up since there are fewer on the market. And the guy who rebuilds your barn "wins" doesn't he?

I think there must be ways to lose wealth without profiting others. But in my case, at least, it requires some thinking.

[*michaelsean*]

(08-15-2018, 10:39 AM)Dill Wrote: Your barn burns down and your cattle all get hoof and mouth disease.  Total loss. 

It would seem there are no winners. But the price of your neighbors cattle may go up since there are fewer on the market. And the guy who rebuilds your barn "wins" doesn't he?

I think there must be ways to lose wealth without profiting others. But in my case, at least, it requires some thinking.

My barn burns down and I don't rebuild.

I'm selling those damn cows anyway. do you know what it costs to feed them?

[GMDino]

(08-15-2018, 10:30 AM)Belsnickel Wrote: Speculative markets aren't inherent in the system, either, but that's all we have been discussing. However, if there are speculative markets people speculating a drop in the market will be inherent to that system.

I couldn't help myself....

[fredtoast]

(08-14-2018, 10:44 PM)Vlad Wrote: "Taking"?...I know, that word just naturally comes out when you hate the rich. "Amassing" would have been a better word.
 
Nevertheless your statement:
The top 10% of the richest citizens in this country have been taking all the new wealth created for decades.
Sounds weird. Can you clarify?

Wealth is created, not taken from someone else.

The working class who's labor helps create new wealth should get a potion of that wealth.  New wealth is being created as our economy grows, but all of the new wealth is going to the top 10% and the working class is not receiving any benefit for the wealth it helped to create.

(08-14-2018, 10:44 PM)Vlad Wrote: Speaking of "leaders", Al Sharpton and Jessie Jackson have gained power by their overblown and false claims of racism thus exacerbating racial division.

Yes, those are exactly the type of people I was talking about, and they exist on BOTH sides.  But there are actually very few people who benefit directly from stirring the race pot like Sharpton and David Duke.

[fredtoast]

(08-15-2018, 09:26 AM)michaelsean Wrote: So if my stock goes up 10%, who lost? 

Probably the workers whose labor help create that increase.  That has been the way it has been working for years now.  Over half of all citizens onw no stocks while 62% of all stocks are owned by the top 5%.

Middle and lower class wages have not gone up and that is one of the big reasons stock prices have risen.  Companies are keeping wages down and handing off the increased profits to the owners.

[fredtoast]

I thought this was a thread about race.

[Belsnickel]

(08-15-2018, 01:02 PM)fredtoast Wrote: I thought this was a thread about race.

Economic justice IS racial justice.

[Dill]

(08-15-2018, 10:50 AM)michaelsean Wrote: My barn burns down and I don't rebuild.

I'm selling those damn cows anyway.  do you know what it costs to feed them?

You can't sell cows with hoof and mouth.

You lose your farm to the bank and I buy it cheap at public auction.

I rebuild your barn with the money I saved.  Carpenter is richer now too.

I sell my cows at higher price on the local market since there are fewer cows now competing for the same consumers.
I 'll let the pasture lie fallow this year so I don't spend so much on feed next year.

One big winner in this case.

[*michaelsean*]

(08-15-2018, 01:33 PM)Dill Wrote: You can't sell cows with hoof and mouth.

You lose your farm to the bank and I buy it cheap at public auction.

I rebuild your barn with the money I saved.  Carpenter is richer now too.

I sell my cows at higher price on the local market since there are fewer cows now competing for the same consumers.
I 'll let the pasture lie fallow this year so I don't spend so much on feed next year.

One big winner in this case.

I'm selling those sumbitches and you can't stop me. 

[*michaelsean*]

(08-15-2018, 12:59 PM)fredtoast Wrote: Probably the workers whose labor help create that increase.  That has been the way it has been working for years now.  Over half of all citizens onw no stocks while 62% of all stocks are owned by the top 5%.

Middle and lower class wages have not gone up and that is one of the big reasons stock prices have risen.  Companies are keeping wages down and handing off the increased profits to the owners.

Rising stock price is not a loss to employees. 

[GMDino]

(08-15-2018, 01:40 PM)michaelsean Wrote: Rising stock price is not a loss to employees. 

But they don't gain.  And that widens the income gap.  So it's a loss.

The rising tide did not lift all ships....to paraphrase a popular conservative talking point.

[*michaelsean*]

(08-15-2018, 01:59 PM)GMDino Wrote: But they don't gain.  And that widens the income gap.  So it's a loss.

The rising tide did not lift all ships....to paraphrase a popular conservative talking point.

Yeah that's a broad statement based on the whole economy, and not the price of a single stock.  Plus lots of companies give stock to their employees.  

[GMDino]

(08-15-2018, 02:10 PM)michaelsean Wrote: Yeah that's a broad statement based on the whole economy, and not the price of a single stock.  Plus lots of companies give stock to their employees.  

And that's possible too.  But you example is very specific and not something that the majority of workers will benefit from.