Quote:
Originally Posted by woj
Can you clarify how wealth is created when nothing is "produced, made, created or worked for"? there are 3 parties, alice, bob, and charlie, all start off with $100...
then:
A gives $100 to B
B gives $100 to C
C gives $100 back to A
All end up with $100, just like they started, no useful goods or services were exchanged, money was simply moved around, where/how exactly was the wealth created?
If you move money around AND create some useful good/service while you are at it, then yea, wealth is created... but if you JUST move money around without creating anything I don't see how wealth would be created...
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If say 5 of us come together, decide we're going to do business together with a focus of helping each other... we could easily create a money flow chain that would allow us to move larger sums of money, benefit from a wider range of investments, purchasing power, exchanges of money, or say sharing of traffic flow purchased as the volume of money is moved and replaced, benefiting each persons Company before they money flow happens to them and during. As the various money/business is exchanged, wealth is instantly created.
Think about how the Gov gives money to loan and they charge interest, and takes back it's own money as payment for interest when it didn't give out enough to pay back both. It's not possible and it's not like the fed reserve actually prints all that money..... Simply by the money moving around, it creates more money, it creates wealth.
With your example, it's too small but it does apply some what. As a Corporation, if I only have $100, we all trade I then I have $300, I earn 1 cent interest per 100 lets say, we exchange back. I have $100 and 3 new pennies - instead of one. All from doing nothing but moving money, and that's only looking at one aspect of it.