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Comment by est31 | Hacker News Reader

> The most straightforward modern equivalent to Turchin's "elite" nobility would not be people with advanced degrees: it would be investors who do not work for wages. (Not to say there is no overlap between those groups.)

Investors do a lot of work, because they have to constantly think where to put their money, evaluate alternatives, make sure there is no money wasted on things, etc. Even passive investors who only have S&P portfolios still contribute to the economy by providing capital to companies to invest into new things.

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Yeah but even if we accept passive investment is a form of productive labor, there's a limited number safe/good investments for those good investors.

As we saw in the 2008 recession when more and investors pile on even the safest investments (mortgages backed securities) the quality of those investments tends to be diluted (via CDO's, errant ratings companies, exploitative real estate practices)

This is what's making me nervous about index funds right now, the demand seems extremely high, but what about the supply how would you determine such a thing?

What is investors are smart but there simply aren't enough good investments out there? Are they going to give up and become doctors, lawyers or engineers? Or just spend more time with their kids?

Fundamentally, investments are a bet that the future will be richer than the present.

If there aren't enough good investments now then that's an indication that the market believes there are major structural problems with the economy that will prevent the future from being richer than the present.

That's a far, far, more serious issue than just a question of what the kind of people who expect to receive passive incomes will do with their time.

Obviously, the pandemic is having a major current impact, but as you say, there has been a shortage of good investments since at least 2008.

I believe the underlying issue is a misallocation of resources into rentier economics and not enough into productive growth. We've collectively put far too much money into monopolies that squeeze larger percentages of money out of people and not enough money into innovation that improves the human environment. We need more of the original Google (i.e. the revolutionary search engine) and a lot less of the current Alphabet (i.e. the rentier advertising monopolist).

There is an obvious shift away from labor to capital. Central banks shift the balance way too far toward capital as it is right now. Lack of labor stimulus leads to inefficient allocation of labor.

This is what i dont get. Isnt is only if u buy stock at an ipo that the company gets the money?

Otherewise, either by buying an index or a stock normally, ur giving ur money to other investors, not the company itself.

Investors in secondary markets do not inject any money into businesses whatsoever. They are simply buying shares from other secondary market investors

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