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NateNate60

@ NateNate60 @lemmy.world

Posts
10
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506
Joined
3 yr. ago

  • Deflation

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  • I don't agree. The explosion in economic activity is not solely because of industrial advances. The global supply chain is extremely well-connected, and it's this system of global trade that is the real oil of the modern economy. There is almost nothing more advanced than a wheelbarrow that can be economically made without involving some aspect of global trade. Sure, industrial advances are part of it, but it's the trade that makes any of the products worth anything.

    A machine that can manufacture a million wheelbarrows in one hour produces extremely little value unless those wheelbarrows are traded.

    If you want to see what shutting off trade does to a country, take a look at the current happenings of United States.

  • Deflation

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  • This is non-sequitur. The fact that value derived from labour is required to exist for value derived from trade to be generated does not mean that either category of value is less real.

    Labour gets you from 0 to 1. Trade gets you from 1 to 100. Labour generates value by adding to what's available. Trade generates value by multiplying what's available. The observation that zero multiplied by anything is still zero does not invalidate the fact that multiplication is still more powerful than addition. It just means that one cannot exist without the other if you want to have more than zero.

  • Deflation

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  • I do. I claim that trade can destroy value, and it can destroy value that is created through labour just as much as it can amplify it. A change in how much people value something can turn productive labour which produces valuable goods into a worthless activity which wastes time.

    If tomorrow, people suddenly decide rice is disgusting, repulsive, and not fit for human consumption, that would destroy all the value in rice production equipment, and it would destroy the value of all the rice that has been produced but not consumed. The rice hasn't changed. The nutritional value hasn't changed. But since rice no longer makes people happy, its value is now far less, regardless of how much labour was expanded to produce it.

    There is no objective standard for value. Value is inherently subjective. Not even for food. After all, dandelions are edible, but also perfectly worthless because it's simply culturally unacceptable to eat them. Blackberries are another great example. In your area they might be a rare and expensive delicacy. In my region, they grow like weeds and we pay people to remove blackberry vines.

    For a similar reason, we could pour as much labour as we want into producing mud cakes, but no matter how much work it was to make them, mud cakes are worthless to everyone and so there is no surplus created by making them. Instead, everyone who expended resources (money, equipment, labour) to make them has incurred an economic loss because the resources were consumed and nothing valuable was received in return.

  • Deflation

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  • tl;dr I am arguing that the value which is created (or realised) from trade is equally as valid as value created from the production of resources or services, and that it is a mistake to only consider physical goods or actual services provided as "value".

    Let me quantify what I mean by "value" here. By "value" I mean the economic concept of surplus. I assume you already know what that means but for the reader's benefit, surplus is the difference between what an actor values a resource at and what they had to give up to obtain that resource.

    All resources are inherently created by labour. In that, you are right. Labour creates initial value. But most of the surplus that exists in the economy is a result of trade. Trading the resource with others makes the resource more valuable as it passes to people who value it more and more.

    Let's just start with labour as a resource. Everyone possesses hours of their time as a resource. And for most people, their time isn't inherently worth much to themselves (i.e. people generally would much rather work and be paid at least a little bit than to be unemployed without money), so finding a job at the Pokémon factory and working for wages generates a large amount of surplus.

    An hour labour might convert $100 worth of cardstock into 100 packs of Pokémon cards. You get paid $30 for this labour, which is a large surplus to you because you would be much, much happier with the $30 than to sit around at home for an hour, especially knowing you can do this trade 40 times weekly. But what value is generated here? The value of a resource is determined, in economics, by the amount of utility that whoever owns it derives from having it. You have traded away your hour of labour. Perhaps you would only value that hour at $5 (i.e. you would be happier with the hour at home than $4.99, and you would be happier with $5.01 than the hour at home), so you have generated $25 worth of surplus for yourself by trading your hour. On the other hand, the Pokémon Company knows it can make a tidy profit on the results of your labour (the Pokémon cards), so maybe it values the labour at $50, and then banks a $20 surplus by trading its money for your labour.

    But nonetheless, the product of that labour is inherently worthless from an intrinsic standpoint, and the Pokémon Company obviously derives no intrinsic utility from it. All the utility from it comes from knowing it can be resold. So when it sells those cards to a retail store for $300, it is creating nearly $170 in surplus (subtracting off the $100 in paper and $30 in labour to avoid double-counting). This surplus wasn't derived from labour; not meaningfully so, anyway. The amount of work involved here is nominal compared to the surplus generated from the mere fact that a trade occurred.

    All this extra surplus is what makes people feel richer. And the lack of this trade makes people feel poorer. The underlying physical goods are worth nothing if they stay with people who don't value them. A country could produce ten times more rice and would still be poorer if that rice fails to find its way to the hungry people who value it most. The rice farmer doesn't derive utility from hoarding a hundred tonnes of rice. They do not derive happiness from it. That happiness, that surplus, is only made real when the rice gets into the possession of the people who want to eat it. So trading a kilogram of it to their neighbour is what creates this value. It turns a resource which was nearly worthless to its previous owner into a resource which is highly desired and worth far more to someone else.

  • Deflation

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  • Even 1% deflation will kill a good portion of investment and job creation. It drives up interest rates because the risk of lending money out is less worth it compared to letting it sit, so you have to earn more interest for it to be worth it. This drives up loan rates which means significantly fewer people find it worth it to borrow and start or expand businesses. The job market constantly loses jobs, but without new ones to replace them, people start losing work and then getting scared that they won't be able to find a new one. It is this environment that causes ordinary people to not spend. It's because they're scared of losing their jobs.

  • Deflation

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  • Absolutely not, and I hate this term "made up" whenever people are trying to describe the economy.

    In an economy populated by free economic agents, prosperity is determined less so by the amount of goods available but by how much those agents trade among each other. For each type of economic resource, whether that be goods, services, labour, money, or social status, there is a certain distribution of those resources which maximises everyone's utility. It is impossible to nail down what that distribution is, but when people are more willing to trade with each other, those resources have a tendency to flow towards the people who most want them. Even though the amount of resources available does not grow, a "good economy" where people are willing to exchange resources will feel more prosperous than a "bad economy" where everyone is scared of losing their resources and thus hoard what they have.

    You are happy when you are able to trade the resources you have (possibly just your labour) and get in return things that you value more than keeping your labour. Food, shelter, cars, and Pokémon cards. You could keep your 40 hours, but surely you wouldn't be very happy with just that, would you? Trade creates value.

    And because I know people like talking about socialism here, this is where the Soviets went wrong and where the Chinese went right. The Soviets thought that the way to prosperity is to produce more. The Chinese know that the way to prosperity is to allocate better, and one of the best ways to allocate resources that we know of, is by letting people trade. That's not to say it's a perfect way or even a good way, but so far we have not come up with anything better than to let people trade and then step in when the trade goes wrong or does not produce an optimal distribution of resources. Don't misunderstand; unregulated trade tends to clog itself up and results in a very suboptimal resource distribution. It needs to be closely regulated.

    Money is nothing more than an intermediary to allow trade to occur. When people hoard money, that in itself is a dampener on economic growth. Money which is spent circulates again and again, and greases the wheels of trade. An economy where people freely spend and freely earn money is a prosperous one. An economy where people hoard money is one where nobody gets what they want (except the idiots who somehow derive utility from hoarding money).

    So no, it is not "made up". In economics, public confidence is what creates prosperity. When people are confident, they spend. They earn it back. They trade. They create value. When people are scared, they desperately hold on to what they have. They stop trading. That value, it never gets created.

  • Deflation

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  • Because deflation isn't the only thing that causes them. It's just that a deflationary economy makes them far more likely to happen to a far greater number of people.

  • Deflation

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  • Deflation is devastatingly bad for banks. It discourages investment and new businesses because it shifts the maths in favour of just holding cash rather than investing in new businesses. No new businesses means fewer people need loans. And deflation makes loans more expensive for ordinary people, who stop borrowing. Banks profit only by lending out the money that they have. No loans, no profit.

  • Deflation

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  • What people think living in a deflationary economy looks like: Groceries are 5% cheaper than last year.

    What living in a deflationary economy is actually like: Nobody is spending money. Your hours are cut and you won't get a raise this year. Your income is down 25% compared to last year. You can't afford to buy anything. Businesses everywhere have to cut prices to compete for the dwindling number of customers.

    Investment dries up. Job creation comes to a complete stop. 500 people competing for every job opening that comes up. Wages keep going down as a result. The uncertainty means that even people who still have a job are choosing to save as much as possible rather than spend.

    Foreclosures rise, people lose their homes as the wealthy snap up the newly-freed housing stock at distressed prices. Car repossession rates skyrocket, causing a surge of used cars to enter the market, dragging down new car prices along with them. Automobile manufacturers start biting their nails as analysts project lower sales numbers and tighter margins, pushing most heavy industry into the red. Workforce cuts soon follow.

    Credit default rates soar, leading to the first bank failures. National deposit insurance schemes soften the blow and prevent a full banking crisis, but deposit insurance rates start climbing, causing banks to raise fees and cut benefits.

    The lower economic activity causes budget shortfalls in every city in the country. Poor tax growth forecasts force local councils to start cutting services. The first to go will be cultural events. Then the public transport cuts come. And then homeless services. Then eventually all departments except police, fire, water, and electricity get cut down to the bone, and then some. Maintenance on public buildings get slapped with 5- or even 10-year deferrals.

    People are skipping meals to make ends meet. Produce rots on the shelves until grocers learn to order less. Lower crop prices push many small to medium farms into insolvency; larger corporate farms are better able to weather the storm. Groceries are 5% cheaper than last year.

  • Deflation

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  • Unless you live in the US, because the reason that your money would deflate is that you would have a lot less of it.

  • Linus Torvalds used AI to fix a Linux bug, and now LLM critics on Linux face an uncomfortable choice

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  • Please understand that ChatGPT was released in November 2022.

    And also understand that the distinction between chess and ChatGPT is the point of the comment. These two things both use AI but one is harmless and useful while the other is not.

  • Linus Torvalds used AI to fix a Linux bug, and now LLM critics on Linux face an uncomfortable choice

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  • Exactly right. That is the distinction I'm trying to draw.

  • Linus Torvalds used AI to fix a Linux bug, and now LLM critics on Linux face an uncomfortable choice

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  • Chess engines have been using AI, specifically, neural networks, for years before ChatGPT or other LLMs. Nobody complained.

  • Hey Canada, just wanted to let you know there's alternatives.

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  • Because UTC-7 and UTC-8 are also wrong. The label "Pacific Time" means, in the United States and Mexico, the civil time standard that observes standard time at UTC-8 and daylight saving time at UTC-7. You cannot call this standard merely "UTC-8" because then it's wrong half of the year.

    It is important to note that by calling year-round UTC-7 "Pacific Time", British Columbia and Yukon are the ones stepping out of the programme to do something idiosyncratic. The rest of the Pacific Time Zone (Washington, Oregon, Idaho, Nevada, California, and Baja California) has a greater population than the entirety of Canada. There are approximately 56 million residents of the non-Canadian portion of the Pacific Time Zone, where standard time is UTC-8, compared to 5 million in the Canadian portion, which is UTC-7.

  • Hey Canada, just wanted to let you know there's alternatives.

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  • "Pacific Time" means "whatever the civil time is in the Pacific Time Zone, accounting for daylight saving time". So that would be 23:04 (UTC-7) as of writing.

    If today's date were instead 30 December, "Pacific Time" would be 22:04 (UTC-8) in Washington, Oregon, and California, while it would be 23:04 (UTC-7) in British Columbia and Yukon. Both would be called "Pacific Time" despite not being the same time, and both being on standard time.

  • Hey Canada, just wanted to let you know there's alternatives.

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  • The name causes confusion. Let me give you this example. What time UTC would "17:00 PT" be?

    That question depends now not only on what time of year it is, but also where. "Pacific Time" now no longer uniquely identifies a single timekeeping scheme.

  • Hey Canada, just wanted to let you know there's alternatives.

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  • British Columbia basically did a similar thing by declaring permanent daylight savings time because, according to the premier, they're no longer going to wait for the US to move as well before moving themselves.

    Except now the situation is objectively worse than it was before, because BC is geographically in the UTC-8 zone, but permanent Pacific Daylight Time is the same as permanent Mountain Standard Time (UTC-7). Except they don't call it Mountain Standard Time in BC, they stubbornly continue to insist they're in the UTC-8 zone. Except they don't call it "Pacific Daylight Time" either, they call it just "Pacific Time". No "Daylight". Despite the fact that their standard time is what the rest of North America calls Mountain Time.

    They had four good choices, and chose none of them:

    • UTC-8 year round, call it "Pacific Standard Time"
    • UTC-7 year round, call it "Mountain Standard Time"
    • UTC-8 or UTC-7 year round, call it "Western Canada Time".

    Decent idea, rubbish execution.

  • 111 mph: Brevard Deputy of the Year avoids arrest under Florida ‘Super Speeder’ law

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  • Driving a motorcycle at double the speed limit is far more dangerous than driving a car at normal speeds. That's why driving a car at those speeds will also get you a driving ban.

  • 111 mph: Brevard Deputy of the Year avoids arrest under Florida ‘Super Speeder’ law

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  • The risk is bourne by the public in three ways:

    1. The public pays for the cost of their injuries, either directly through a state healthcare system or in the form of increased premiums. An insurance company has no way to differentiate reckless motorcyclists who are lucky from responsible motorcyclists.
    2. A crash on a road will close one or more lanes while emergency services attend the site of the crash, causing congestion. While the overall inconvenience per motorist is small, it happens to many hundreds to thousands of motorists and thus collectively wastes hundreds of hours of people's time.
    3. Normalising reckless behaviour increases its social acceptability, and I think that as soon as it becomes widely known that you won't go to jail for operating a motorcycle at double the speed limit, the first people to try this will be teenagers
  • Deleted

    Permanently Deleted

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  • You can suggest things to your local Party members, that get brought up in local meetings. Then eventually these might make their way into the ear of some higher-level officials with the power to make it happen.

    Or, you call a hotline and complain about something. A bureaucrat then gets working on it. The national hotline is 12345 to complain about things that aren't working.

    Or you post on social media and eventually, if the post becomes popular, Party officials see it and take action.

  • Not The Onion @lemmy.world
    NateNate60 @lemmy.world

    Farage left fighting a trash can as the UK populist leader’s election gamble backfires

    www.cnn.com /2026/07/09/uk/nigel-farage-special-election-bin-face-intl
  • Ask Lemmy @lemmy.world
    NateNate60 @lemmy.world

    Who do you think was history's greatest villain?

  • Not The Onion @lemmy.world
    NateNate60 @lemmy.world

    U.S. House Speaker calls Portland naked bike ride [protest] ‘most threatening thing I’ve seen yet’

    www.oregonlive.com /portland/2025/10/us-house-speaker-calls-portland-naked-bike-ride-most-threatening-thing-ive-seen-yet.html
  • politics @lemmy.world
    NateNate60 @lemmy.world

    The hypocrisy of recognizing Palestine but not Taiwan

    wapo.st /4lnUPGN
  • politics @lemmy.world
    NateNate60 @lemmy.world

    Colorado Attorney-General explains why the state is suing a deputy who aided ICE

    www.pbs.org /newshour/show/colorado-ag-explains-why-the-state-is-suing-a-deputy-who-aided-ice
  • politics @lemmy.world
    NateNate60 @lemmy.world

    DOGE vowed to make government more ‘efficient’ — but it’s doing the opposite

    www.washingtonpost.com /business/2025/06/02/doge-vowed-make-government-more-efficient-its-doing-opposite/
  • politics @lemmy.world
    NateNate60 @lemmy.world

    White House MAHA Report may have garbled science by using AI, experts say

    www.washingtonpost.com /health/2025/05/29/maha-rfk-jr-ai-garble/
  • News @lemmy.world
    NateNate60 @lemmy.world

    White House MAHA Report may have garbled science by using AI, experts say

    www.washingtonpost.com /health/2025/05/29/maha-rfk-jr-ai-garble/
  • politics @lemmy.world
    NateNate60 @lemmy.world

    Trump’s immigration ratings turn negative, Post-ABC-Ipsos poll finds

    wapo.st /3Yek4Tj
  • memes @lemmy.world
    NateNate60 @lemmy.world
    Locked

    Hope you like socialism