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Yachts and mansions don't build themselves. Jobs are created by their construction. Then that money is spent somewhere else, etc. Multiplier effect. Better that things are bought than the money sitting in a money market account.

In regards to the island purchase in Hawaii, it sounds like he is putting funds into improving the infrastructure on the island. (I don't want to get into an argument on whether that is a good or bad thing. Just pointing out that money is being put into the economy by him doing so.)



Sure the money is spent paying people to build those yachts, etc., but then the benefits of that labor, once spent, continue to accrue only to the owner. In other words, the yacht builders are paid once; the owner benefits continually from ownership of the finished product.


The same could be said of anything including the keyboard I'm typing this comment on.


Your keyboard is probably used to produce new value for yourself and others, and represents a very small fraction of the economy. A yacht (to continue the example) is a much larger chunk of economic output frozen in the control of a single owner.

I'm not saying nobody should have yachts, just that the argument that the yacht builders were paid only addresses part of the economic effect of concentrated wealth.


Yachts don't operate, maintain, or moor themselves.


We had this 'Trickle Down Effect' with Maggie Thatcher in the UK - it does not work!

Looking for a convenient link, the Wikipedia page is rather nifty. Seems people have fallen for 'Trickle Down Effect' many times, although it was called the 'horse and sparrow theory':

http://en.wikipedia.org/wiki/Trickle-down_economics


What's the problem with the money market account? The money is not `sitting' there, it's lend out.


One less multiple.


But also less inflation. So, just let the government print more money.




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