Topic: Is deflation truly that bad for an economy? - page 9. (Read 24916 times)

Quote from: Erdogan on April 06, 2015, 05:25:00 PM

The problem is you saying that consumption is not good per se. If you don't produce (i.e. your consumers don't consume), you just don't get richer (and other people through your business activities as well). In real life, though, you would actually become poorer (cost of capital and all the things you said hereto on the matter)...

Consumption is good if the consumer thinks it is good. If he rather wants to save, that is good too. What is not good, is when someone steals the savings and invest it, allegedly for the benefit of the victim.

So you agree that consumption as such is not bad, i.e. it is good? If you agree to this, would you as well agree to a statement that anything that contributes to the increase of aggregate wealth available to a society as whole is good too? I mean anything which is considered ethical in this society and not against human nature indeed...

No, only that which the consumer requires and expresses as demand on the market.

That said, you agree that not all that adds up to the total wealth of a society is good, is it? You simply can't have some part of consumption being allegedly bad, and, at the same time, agree that all increase in aggregate wealth of a society being good nevertheless...

What is your answer to such a dilemma?

Look, I don't know what you are up to, lure me into a socialistic trap perhaps. There is no one that can allege, ethically, that someting is bad or good, except the traders themselves. If you don't like something, don't buy it, argue againts it in the newspapers, you can even associate with a bunch of people to boycott it, just don't use violence or hire some violent people through the voting system to use violence against the traders. That's all.

Socialistic trap?! It was actually a logic trap to show you that your point doesn't stand. You see, your arguments may be incomprehensible, or even bizzare, but they should at least be logically consistent. And now you begin talking absolute nonsense about violence, traders and what else, instead of dealing directly with rather a simple issue...

In fact, it was you who first said that something (namely, hoarding) is not negative

Ok back to hoarding. Why do you think coffe is available all year round, even if coffee is harvested only once a year? Why do you think skis are available in ample supply just when you need them in the winter vacation, even if they are produced all year round? Why do you think a flight is available to you just when you need to go to that conference, even if it takes years to build an aeroplane, and the owner could not possibly know your plans? Why do you think someone just gives you an umbrella when you hit the street in New York, without you having ordered it in advance?

It is all hoarding. You want to glue some high flying ehics to it, but there isn't.

deisik

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Quote from: deisik on April 06, 2015, 04:54:55 PM

Quote from: deisik on April 06, 2015, 04:54:55 PM

The problem is you saying that consumption is not good per se. If you don't produce (i.e. your consumers don't consume), you just don't get richer (and other people through your business activities as well). In real life, though, you would actually become poorer (cost of capital and all the things you said hereto on the matter)...

Consumption is good if the consumer thinks it is good. If he rather wants to save, that is good too. What is not good, is when someone steals the savings and invest it, allegedly for the benefit of the victim.

So you agree that consumption as such is not bad, i.e. it is good? If you agree to this, would you as well agree to a statement that anything that contributes to the increase of aggregate wealth available to a society as whole is good too? I mean anything which is considered ethical in this society and not against human nature indeed...

No, only that which the consumer requires and expresses as demand on the market.

That said, you agree that not all that adds up to the total wealth of a society is good, is it? You simply can't have some part of consumption being allegedly bad, and, at the same time, agree that all increase in aggregate wealth of a society being good nevertheless...

What is your answer to such a dilemma?

Look, I don't know what you are up to, lure me into a socialistic trap perhaps. There is no one that can allege, ethically, that someting is bad or good, except the traders themselves. If you don't like something, don't buy it, argue againts it in the newspapers, you can even associate with a bunch of people to boycott it, just don't use violence or hire some violent people through the voting system to use violence against the traders. That's all.

Socialistic trap?! It was actually a logic trap to show you that your point just doesn't stand. You see, your arguments may be incomprehensible, or even bizzare, but they should at least be logically consistent. And now you begin talking sheer nonsense about violence, traders and what not, instead of dealing directly with rather a simple issue...

In fact, it was you who first said that something (namely, hoarding) is not negative

Erdogan

legendary

Activity: 1512

Merit: 1005

The problem is you saying that consumption is not good per se. If you don't produce (i.e. your consumers don't consume), you just don't get richer (and other people through your business activities as well). In real life, though, you would actually become poorer (cost of capital and all the things you said hereto on the matter)...

Consumption is good if the consumer thinks it is good. If he rather wants to save, that is good too. What is not good, is when someone steals the savings and invest it, allegedly for the benefit of the victim.

So you agree that consumption as such is not bad, i.e. it is good? If you agree to this, would you as well agree to a statement that anything that contributes to the increase of aggregate wealth available to a society as whole is good too? I mean anything which is considered ethical in this society and not against human nature indeed...

No, only that which the consumer requires and expresses as demand on the market.

That said, you agree that not all that adds up to the total wealth of a society is good, is it? You simply can't have some part of consumption being allegedly bad, and, at the same time, agree that all increase in aggregate wealth of a society being good nevertheless...

What is your answer to such a dilemma?

Look, I don't know what you are up to, lure me into a socialistic trap perhaps. There is no one that can allege, ethically, that someting is bad or good, except the traders themselves. If you don't like something, don't buy it, argue againts it in the newspapers, you can even associate with a bunch of people to boycott it, just don't use violence or hire some violent people through the voting system to use violence against the traders. That's all.

deisik

legendary

Activity: 3458

Merit: 1280

English ⬄ Russian Translation Services

The problem is you saying that consumption is not good per se. If you don't produce (i.e. your consumers don't consume), you just don't get richer (and other people through your business activities as well). In real life, though, you would actually become poorer (cost of capital and all the things you said hereto on the matter)...

Consumption is good if the consumer thinks it is good. If he rather wants to save, that is good too. What is not good, is when someone steals the savings and invest it, allegedly for the benefit of the victim.

So you agree that consumption as such is not bad, i.e. it is good? If you agree to this, would you as well agree to a statement that anything that contributes to the increase of aggregate wealth available to a society as whole is good too? I mean anything which is considered ethical in this society and not against human nature indeed...

No, only that which the consumer requires and expresses as demand on the market.

That said, you agree that not all that adds up to the total wealth of a society is good, is it? You simply can't have some part of consumption being allegedly bad, and, at the same time, agree that all increase in the aggregate wealth of a society being good nevertheless...

What is your answer to such a dilemma?

Erdogan

legendary

Activity: 1512

Merit: 1005

Consumption is not good in itself, that depends on the preferences of the consumers, that is, everybody. Using central planning, confiscation and force to extend consumption now, is destruction of value. I can not understand why people with all senses in behold can echo the nonsense from the statists.

Why consumption is not good by itself? It may not be good but that's what would depend... All in all, why would you produce anything if there would be no consumption for your goods?

In that case I would not produce it. That is the point. The consumers decide, and you need to consume to live, so something will always need to be produced. Why is this a problem?

The problem is you saying that consumption is not good per se. If you don't produce (i.e. your consumers don't consume), you just don't get richer (and other people through your business activities as well). In real life, though, you would actually become poorer (cost of capital and all the things you said hereto on the matter)...

Consumption is good if the consumer thinks it is good. If he rather wants to save, that is good too. What is not good, is when someone steals the savings and invest it, allegedly for the benefit of the victim.

So you agree that consumption as such is not bad, i.e. it is good? If you agree to this, would you as well agree to a statement that anything that contributes to the increase of aggregate wealth available to a society as whole is good too? I mean anything which is considered ethical in this society and not against human nature indeed...

No, only that which the consumer requires and expresses as demand on the market.

deisik

legendary

Activity: 3458

Merit: 1280

English ⬄ Russian Translation Services

Consumption is not good in itself, that depends on the preferences of the consumers, that is, everybody. Using central planning, confiscation and force to extend consumption now, is destruction of value. I can not understand why people with all senses in behold can echo the nonsense from the statists.

Why consumption is not good by itself? It may not be good but that's what would depend... All in all, why would you produce anything if there would be no consumption for your goods?

In that case I would not produce it. That is the point. The consumers decide, and you need to consume to live, so something will always need to be produced. Why is this a problem?

The problem is you saying that consumption is not good per se. If you don't produce (i.e. your consumers don't consume), you just don't get richer (and other people through your business activities as well). In real life, though, you would actually become poorer (cost of capital and all the things you said hereto on the matter)...

Consumption is good if the consumer thinks it is good. If he rather wants to save, that is good too. What is not good, is when someone steals the savings and invest it, allegedly for the benefit of the victim.

So you agree that consumption as such is not bad, i.e. it is good? If you agree to this, would you as well agree to a statement that anything that contributes to the increase of aggregate wealth available to a society as whole is good too? I mean anything which is considered ethical in this society and not against human nature indeed...

Erdogan

legendary

Activity: 1512

Merit: 1005

Quote from: deisik on April 06, 2015, 12:55:38 PM

Consumption is not good in itself, that depends on the preferences of the consumers, that is, everybody. Using central planning, confiscation and force to extend consumption now, is destruction of value. I can not understand why people with all senses in behold can echo the nonsense from the statists.

Why consumption is not good by itself? It may not be good but that's what would depend... All in all, why would you produce anything if there would be no consumption for your goods?

In that case I would not produce it. That is the point. The consumers decide, and you need to consume to live, so something will always need to be produced. Why is this a problem?

The problem is you saying that consumption is not good per se. If you don't produce (i.e. your consumers don't consume), you just don't get richer (and other people through your business activities as well). In real life, though, you would actually become poorer (cost of capital and all the things you said hereto on the matter)...

Consumption is good if the consumer thinks it is good. If he rather wants to save, that is good too. What is not good, is when someone steals the savings and invest it, allegedly for the benefit of the victim.

Erdogan

legendary

Activity: 1512

Merit: 1005

Setting usable stuff aside, because your foresight tells you that the stuff will be more needed in the future, is investment. It carries a risk (the future could unfold otherwise) and it costs money (the price of the stuff). If you do this investment, you reserve some of the stuff in the now, when the need is not so vital, to release it in the future, when it is scarce. This way you create value. At the same time, the price of the stuff now will increase as a result of your demand, directing more investments into producing the stuff.

I don't think that by this you can create value. Actually, you create deficit and profit by this later...

Because the stuff is more valueable in the future. The value in the future must of course match the cost, the interest and the risk - standard investment accounting.

So, at first you deprive someone of something valuable, then give it back when it becomes more valuable through deficit and call this value creation? I for one cannot call this process as value creation. You, of course, may think different...

You nailed it, and I can not argue a non argument...

deisik

legendary

Activity: 3458

Merit: 1280

English ⬄ Russian Translation Services

Consumption is not good in itself, that depends on the preferences of the consumers, that is, everybody. Using central planning, confiscation and force to extend consumption now, is destruction of value. I can not understand why people with all senses in behold can echo the nonsense from the statists.

Why consumption is not good by itself? It may not be good but that's what would depend... All in all, why would you produce anything if there would be no consumption for your goods?

In that case I would not produce it. That is the point. The consumers decide, and you need to consume to live, so something will always need to be produced. Why is this a problem?

The problem is you saying that consumption is not good per se. If you don't produce (i.e. your consumers don't consume), you just don't get richer (and other people through your business activities as well). In real life, though, you would actually become poorer (cost of capital and all the things you said hereto on the matter)...

deisik

legendary

Activity: 3458

Merit: 1280

English ⬄ Russian Translation Services

Quote from: twiifm on April 06, 2015, 11:42:18 AM

Setting usable stuff aside, because your foresight tells you that the stuff will be more needed in the future, is investment. It carries a risk (the future could unfold otherwise) and it costs money (the price of the stuff). If you do this investment, you reserve some of the stuff in the now, when the need is not so vital, to release it in the future, when it is scarce. This way you create value. At the same time, the price of the stuff now will increase as a result of your demand, directing more investments into producing the stuff.

I don't think that by this you can create value. Actually, you create deficit and profit by this later...

Because the stuff is more valueable in the future. The value in the future must of course match the cost, the interest and the risk - standard investment accounting.

So, at first you deprive someone of something valuable, then give it back when it becomes more valuable through deficit and call this value creation? I for one cannot call this process as value creation. You, of course, may think different...

Erdogan

legendary

Activity: 1512

Merit: 1005

Quote from: twiifm on April 06, 2015, 11:35:40 AM

No. Unemployment is not the result of the free market, it is solely a result of red tape to disallow work, and government intrusion into markets. With free markets, it is just as easy to sell your work (get a job) as it is to sell tomatoes, that is, you get a better price for a better product, but you will be able to sell it all. Young people of today may not believe this, but it has been the case in the past. That is how students could travel, split your summer vacation in two, work in one half, travel in the other. There was never a question of how to find work. This was around here (unspecified) in the seventies.

There is nothing systemically different between now & 70's. Same govt, same Central Bank. If there is a different economic state, then it has nothing to do with the system. Has to do with other forces

The difference, at least around here, is that it is easier to get some form of social support, there is much more (and increasing) red tape, more corporate welfare, and so called seed funds that require that you have friends in high places when you want to start a business. The tax is somewhere between your neck and your ears, meaning your new business don't just have to be more profitable than doing nothing, it has to be brilliantly better.

Erdogan

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Activity: 1512

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Quote from: deisik on April 06, 2015, 09:06:09 AM

Hoarding is not negative. Hoarding is the result of speculation on part of one individual that some ware will be more scarce and valuable in the future. Hoarding makes sure that the stuff is available at the time of need, distributed to those in most want of it through the higher price. Hoarding of money is specially not negative, neither in the now or in the future, because it means that the hoarder in fact consumes less in the now, making goods, including investment goods, available for a lower price to others in the now.

Hoarding postpones consumption. This, taken by itself, isn't good, is it? Then you come to say that hoarding is akin to speculation, i.e. you hoard something so that you could sell it later at a higher price to those who most want it. That I can't understand, since it is you, the hoarder, who contributes greatly to this need in the first place by stashing something away...

You are confused, probably by the negative connotations of the words speculation and hoarding. So let me use other words.

Setting usable stuff aside, because your foresight tells you that the stuff will be more needed in the future, is investment. It carries a risk (the future could unfold otherwise) and it costs money (the price of the stuff). If you do this investment, you reserve some of the stuff in the now, when the need is not so vital, to release it in the future, when it is scarce. This way you create value. At the same time, the price of the stuff now will increase as a result of your demand, directing more investments into producing the stuff.

Consumption is not good in itself, that depends on the preferences of the consumers, that is, everybody. Using central planning, confiscation and force to extend consumption now, is destruction of value. I can not understand why people with all senses in behold can echo the nonsense from the statists.

Hoarding (savings) & investment are 2 different things.

WRT Investments your capital is at use. Yes it could be good or bad investments but doesn't matter, the capital is being used

WRT Savings, the capital is just sitting there, frozen. Might was well consider it not part of economy

Total confusion. Investment is buying capital goods for the purpose of making money. It is not only machinery, it can be stuff like oil or grain. If you save in a commodity, not money, that is investment.

Saving in money, on the other hand, is not investment, it is just saving value for the future. The special thing with saving in money, is that you do not pivot the production structure any specific way. Your demand for money just marginally increases the value of money. Also with lending out your money, you don't affect the market, you invest in what the general market finds most profitable, and you marginally decrease the interest rate.

Just as the consumers affect what should be produced, the money savers direct the investment level. No third party can know better what the level of investment should be.

ipbo

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A little bit of inflation is good for economic growth but, when prices begin to fall after an economic downturn, deflation may set in causing an even deeper and more severe crisis.

twiifm

hero member

Activity: 784

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No. Unemployment is not the result of the free market, it is solely a result of red tape to disallow work, and government intrusion into markets. With free markets, it is just as easy to sell your work (get a job) as it is to sell tomatoes, that is, you get a better price for a better product, but you will be able to sell it all. Young people of today may not believe this, but it has been the case in the past. That is how students could travel, split your summer vacation in two, work in one half, travel in the other. There was never a question of how to find work. This was around here (unspecified) in the seventies.

There is nothing systemically different between now & 70's. Same govt, same Central Bank. If there is a different economic state, then it has nothing to do with the system. Has to do with other forces

twiifm

hero member

Activity: 784

Merit: 500

Quote from: deisik on April 06, 2015, 09:06:09 AM

Hoarding is not negative. Hoarding is the result of speculation on part of one individual that some ware will be more scarce and valuable in the future. Hoarding makes sure that the stuff is available at the time of need, distributed to those in most want of it through the higher price. Hoarding of money is specially not negative, neither in the now or in the future, because it means that the hoarder in fact consumes less in the now, making goods, including investment goods, available for a lower price to others in the now.

Hoarding postpones consumption. This, taken by itself, isn't good, is it? Then you come to say that hoarding is akin to speculation, i.e. you hoard something so that you could sell it later at a higher price to those who most want it. That I can't understand, since it is you, the hoarder, who contributes greatly to this need in the first place by stashing something away...

You are confused, probably by the negative connotations of the words speculation and hoarding. So let me use other words.

Setting usable stuff aside, because your foresight tells you that the stuff will be more needed in the future, is investment. It carries a risk (the future could unfold otherwise) and it costs money (the price of the stuff). If you do this investment, you reserve some of the stuff in the now, when the need is not so vital, to release it in the future, when it is scarce. This way you create value. At the same time, the price of the stuff now will increase as a result of your demand, directing more investments into producing the stuff.

Consumption is not good in itself, that depends on the preferences of the consumers, that is, everybody. Using central planning, confiscation and force to extend consumption now, is destruction of value. I can not understand why people with all senses in behold can echo the nonsense from the statists.

Hoarding (savings) & investment are 2 different things.

WRT Investments your capital is at use. Yes it could be good or bad investments but doesn't matter, the capital is being used

WRT Savings, the capital is just sitting there, frozen. Might was well consider it not part of economy

Erdogan

legendary

Activity: 1512

Merit: 1005

Setting usable stuff aside, because your foresight tells you that the stuff will be more needed in the future, is investment. It carries a risk (the future could unfold otherwise) and it costs money (the price of the stuff). If you do this investment, you reserve some of the stuff in the now, when the need is not so vital, to release it in the future, when it is scarce. This way you create value. At the same time, the price of the stuff now will increase as a result of your demand, directing more investments into producing the stuff.

I don't think that by this you can create value. Actually, you create deficit and profit by this later...

Because the stuff is more valueable in the future. The value in the future must of course match the cost, the interest and the risk - standard investment accounting.