Hacker News Reader

Comment by clint | Hacker News Reader

Take it from the rich people who have primarily hoarded all that money, and give it to poor people who are on the brink of death.

View on HN

> Take it from the rich people who have primarily hoarded all that money

That's not how any of this works. Rich people generally have much less of their assets as cash or cash-equivalent than poor people. They also in general have much more debt than poor people, both in absolute values and as proportion of their net worth. (Simply because they are able to take more debt, and with the neverending low interest rates, taking more debt and investing it is basically free money.)

Doesn't the "hoarding money" thing only even apply if you keep your money as literal physical cash in your mattress?

If it's in a bank account, it's being lent out and is working, no?

Aside from primary home ownership, do wealthy individuals generally borrow money in order to invest it? My financial advisors have never suggested such a strategy.

Those assets can be converted to cash then and redistributed.

That doesn't suddenly change the amount of stuff there is to buy though.

No but it makes it more affordable, which increases spending, which improves the economy, which combats inflation. Or maybe we should continue the "trickle down economy" that has worked so, so well.

More people buying things makes them less affordable, not more. (At least until supply adjusts.)

I'm not understanding your logic - it seems backward to me.

Also we have never actually done "trickle down", it's a bogyman people like to trot out, not something actually done.

That surely would be a quick way to turn it all into inflation

Only redistribute half of it.

Exactly. If the rich are happy to leave it in a bank account gathering dust, it doesn't affect prices. But when everyone is actively bidding for scarce assets, we get inflation.

Rich people don't have tons of money sitting in bank accounts gathering dust.

No, they just have it in gold, stocks, real estate, art, etc... all of which probably doesn't gather much dust--maybe the gold, but if you can afford art, you can probably afford someone to clean it.

I also agree that they have debt for that as well. No reason not to use debt to gain real assets when the fiat debt loses value regularly.

Not if you "take it" with taxation and "give it" through social programs, I don't think

If giving it causes the economy to slow down it could have very hazardous effects. The challenge for lawmakers is how do we aid people in need without causing too much harm to the economy.

Reply on news.ycombinator.com