This explain everything

[Stephen Maturin]

Originally Posted by LadyShea

AML, why are you living in Italy?

Objection. Asked and answered:

Originally Posted by Dumbfuck Veal Calf

In a egualitarian country everyone is keep down at the same level at the worst idiot,drunk-addicted,heroine-abuser double IQ high school dropout useless idiot

In a true lolbertarian anarcho-capitalist wonderland, AML would be among the first ground up and spit out by the merciless meat grinder of meritocracy. On his own merit, AML would have no chance whatsoever of rising to the dizzying heights of "worst idiot,drunk-addicted,heroine-abuser double IQ high school dropout useless idiot." So you see, he needs socialist egualitarianism to help him attain a status he could never hope to achieve on his own.

[seebs]

Life should be fair because the net total wealth of fair societies is quite a lot higher, because more people are stakeholders with a genuine chance for some form of success.

People who can't own property have very little reason to work. People are not all that dumb; if the "chance" to own property isn't real, they aren't gonna be fooled. But if you run a fair system, where people have real rights and a certain amount of basic cooperation is enforced, you suddenly have a lot more people working harder -- and not just working harder, but thinking harder. And that's where you get innovation, which is where the vast majority of the wealth comes from.

So in short, since I want to be wealthy, the best strategy for me to pursue is a strategy which maximizes the number of reasonably wealthy people.

Note that I can do all of this without any appeal to morality or ethics. I can also do it purely by appeals to those, but since people disagree about moral and ethical rules, I prefer to use the purely pragmatic argument.

(Thus my essay on how to become richer than you've ever been.)

EDIT: And yes, I find it hilarious that someone lazy and incompetent is promoting lolbertarianism. A person who's got nothing to contribute probably shouldn't be advocating a system under which his best chance of survival would be someone stronger deciding that he's got a pretty mouth.

[Sauron]

Originally Posted by seebs

A person who's got nothing to contribute probably shouldn't be advocating a system under which his best chance of survival would be someone stronger deciding that he's got a pretty mouth.

I am *so* stealing this.

And no, I won't give you credit. Life's not fair. Sucker!

[seebs]

Oh, it's totally true that rich people can drive innovation and create stuff. It's just that you can be plenty rich to do that in a much less extreme society, and a lot more people have reason to try.

[Vivisectus]

a sane person(aka non-leftist) recognize that is better to live with 3$ in a world where everyone make 3000$ than with 2$ in a world where everyone make 1$

LOL whut - it is better to have 1/3000th of the average wage than 200% of an average wage? How is that economics study going for you genius?

[ZEZOZE]

nope. you're wrong.

[Sauron]

Originally Posted by ITSOZAZ

nope. you're wrong.

Great.

AML is offline and I'm stuck here with an Excitable Bong Boy who wants to pick an argument.

[ZEZOZE]

i'm not picking an argument. i already won it.

cheerio, mate!

[Joshua Adams]

Originally Posted by ITSOZAZ

i'm not picking an argument. i already won it.

cheerio, mate!

Of course demand is required to create jobs. Let's think it through.

Suppose President Obama mails a company a check for $50,000. What do they do with it? According to right-wing fantasy, this is a right and proper move for Obama because that money will be used to hire someone. But, this isn't necessarily true. A business will choose to use that money to hire someone (i.e. create a job) if they expect to be able to extract enough profit from the putative employee's labor to offset the cost of hiring. But the only reason you need labor is to create products or services. And you can only sell those if there's demand. If there's no demand, and they hire someone anyhow, the products will sit unpurchased, the services unused, and that $50,000 will more or less go down the drain. It would have been better for them to just pocket the check instead of hiring anyone with it, or invest it with another corporation. Because their bottom line comes out better that way than if they'd hired someone. And, apparently, that's exactly what happens when the government gives businesses money in the form of tax breaks, without doing anything to spur demand.

I'm no businessman, but this is all, as far as I know, well-known common sense. I may have stated a few things wrongly in a nitpicky way, but I'm sure others here can corroborate the general point with evidence.

So, demand. I'm not sure how much truth there is to the assertion that marketing can create demand out of thin air (it sounds plausible on its face, but I wouldn't expect it to have a huge, wide-ranging effect or anything). But, there is a way that demand can reliably be created: put money into the hands of people who don't have much of it. In other words, redistribution. This goes back to what I was saying before about the decreasing marginal utility of money. Rich people do create demand, of course, but crucially they do not create demand in proportion to the amount of money they have. A billionaire does not create a thousand times the demand of a millionaire. At some point, it kind of levels off, and before that, the growth slows considerably. One may be very wealthy, but he derives no extra benefit from purchasing excess food, or television sets, or what have you. He'll buy good food, a big TV, a very nice house (or a few houses), a nice sports car... yes, he'll spend more than a poor person, for sure. But he won't spend as much as if you divided his money up among 10 people, or (if his wealth is sufficiently large), 100. Because those 10 or 100 people won't share food and TVs and so forth, they'll all want to have their own.

Nobody proposes to do exactly that, but the principle holds. Take some of the rich man's excess, and give it to someone(s) at the subsistence level, and suddenly, more things will be bought. Demand will go up. Businesses will want to sell things to these people who suddenly have spending money, and they will need labor to bring their products to market. Really, everyone wins. At least until the robot revolution.

So, while businesses may speculatively be able to artificially create demand by hiring marketing people, this seems to be a gamble at best, and only benefits that specific company. So giving money to businesses and hoping they spend it that way doesn't seem like a great plan on the whole. It makes much more sense to increase the purchasing power of those who currently can't afford to buy much of anything beyond the necessities, since we can all but guarantee that they'll buy more things then. They'll be happier, businesses will be happier (and not just the one with the government grant to market a specific new gizmo). Everyone wins except spiteful asshole libertarians, so basically it's the best of all possible worlds.

[ZEZOZE]

Originally Posted by Joshua Adams

So, demand. I'm not sure how much truth there is to the assertion that marketing can create demand out of thin air (it sounds plausible on its face, but I wouldn't expect it to have a huge, wide-ranging effect or anything). But, there is a way that demand can reliably be created: put money into the hands of people who don't have much of it. In other words, redistribution.

i appreciate your well thought out response, but you lose me here. we create all sorts of things out of thin air. redistribution satisfies demand, it does not create it. you seem to be talking about a way to eliminate demand (which is fine with me), not how or why it is created. that same insatiable appetite for what's right by the masses is the same instinct that drives the few. demand is about greed. i mean...just look at the word! greed is a concept that is marketed to. it a concept borne out of what is natural...like thin air.

maybe i'm wrong, but i don't think you had an argument with me. but i still think you managed to make a point.

but then i'm often wrong.

[Joshua Adams]

Originally Posted by ITSOZAZ

i appreciate your well thought out response, but you lose me here. we create all sorts of things out of thin air. redistribution satisfies demand, it does not create it. you seem to be talking about a way to eliminate demand (which is fine with me), not how or why it is created. that same insatiable appetite for what's right by the masses is the same instinct that drives the few. demand is about greed. i mean...just look at the word! greed is a concept that is marketed to. it a concept borne out of what is natural...like thin air.

maybe i'm wrong, but i don't think you had an argument with me. but i still think you managed to make a point.

but then i'm often wrong.

Well, Sauron already pretty much articulated what I was trying to say in the post right above yours. You can't just use marketing to convince people to buy a bag of poop. They have to already want/need something like your product to some degree or it's not going to work. Surely, you can hype your product and bring it to people's attention, which will trivially make people want it more than they otherwise would've. But, there are limits to what you can accomplish with this. That's what I mean when I say you can't create demand out of thin air; at most, it seems to me that you can intensify and redirect existing demand.

Another thing I forgot to mention, but which is quite important, is that no matter how much your company advertises its product, it's not going to sell if people don't have the disposable income to buy it. So, again, we see that putting money into consumers' hands will spur more sales than putting money into the business.

[seebs]

Actually, you're just plain wrong about the $3 vs. $2 comparison. See, a dollar isn't an amount of wealth, it's an amount of money. What matters to you in terms of survival or attaining your goals is not the number of money, but the stuff you can get for it. Inflation and deflation both change the value of money, and all they really come down to is a measure of the amount of money in circulation against the amount of stuff in circulation.

So if everyone but you earns $30 a month, and you earn $3 a month, you have 1/10 of what they can afford. If they spend 10% of their money on housing, and 10% on food, then you don't have enough money to have both housing and food. But if everyone but you earns $1 a month, and you earn $2 a month, the prices of food and housing and all those other things will be lower in dollars; if people spend 10% of their money on housing, that means they're spending 10 cents, and your $2 will go a very long way.

This isn't a question of opinion; this is a very, very, well-established fact.

But of course, there's another layer; the layer of perception of wealth. Here is where we get stuff like your idiotic denominator neglect, and it's also where we see comparisons. And yes, it's where we see people who feel poor because they have less than someone rich... And yet simply changing the framing makes people feel better.

So a lot of them do, because unlike you, they have wealth which they created through effort, and can derive pleasure from making that money do what they want done.

Are you familiar with the Oingo Boingo song Capitalism? The thing that makes it funny is that you're indistinguishable from the "middle class socialist brat" the song was written about. That your ludicrous fantasies of an impossible world revolve around your imagined wealth instead of imagined equality change nothing.

At the end of the day, the people you are trying so hard to hold in contempt produce more than you do, work harder, and are happier. And until you get out of the habit of blaming them for your own despair, you're not gonna get better.

[Stormlight]

a sane person(aka non-leftist) recognize that is better to live with 3$ in a world where everyone make 3000$ than with 2$ in a world where everyone make 1$

Oh dear lordy me. Extraordinary! Lolconomics.

[ceptimus]

Occasionally, something completely new comes along. The Rubik cube was a good example. People had no idea that they wanted such a thing until it was invented and shown to them.

The internet is another example. People weren't exactly clamouring for it thirty, or even twenty years ago.

[Sauron]

Originally Posted by ceptimus

Occasionally, something completely new comes along. The Rubik cube was a good example. People had no idea that they wanted such a thing until it was invented and shown to them.

I was thinking of this exact thing this morning, when I was trying to come up with an example of a truly new product where demand didn't exist beforehand.

But then I remembered Pet Rocks. And mood rings. And a bunch of other things from the 70s that I shouldn't have remembered.....

So in point of fact, the demand already was present for mental toys and amusements. This is not a new category. Rubiks cubes, Pet Rocks, mood rings, etc. are simply new entrants into an pre-existing category.

Which takes me to seeb's comment: there are not, in fact, very many truly new categories at all. Only product variations inside existing categories.

[LadyShea]

In general people want/like/need challenges, entertainment, diversion, and information (amongst other things). So they may have not have known they wanted any specific product like the Rubik's cube (which is really just a type of puzzle which isn't new) or Internet, but there is still pre-existing demand in desires/needs/problems.

Why I mentioned Disney though, is that I can't think of even a general pre-existing demand for disparate movie Princesses being put together into one brand and creating a multi-million dollar market for it.

[lisarea]

There is a kind of punctuated equilibrium to consumer demand. Disruptive technologies, and on a smaller scale, killer apps.

Those are pretty much unpredictable, though. They rely on so many different factors that you can't really push or predict them accurately. It just depends on the zeitgeist or something; and if you try to start something a little before the public a little ahead of time, or with the wrong use case or interface or marketing strategy, a technology or other innovation that might have taken off otherwise can fizzle and die.

[LadyShea]

Disruptive technologies

What does that mean? It's the third time I've seen it in a few weeks and I don't understand

[lisarea]

It's an innovation that, effectively, creates a new market demand. Basically, the technology fundamentally changes the way people do things, rather than filling an extant need. Sometimes they replace an older technology, sometimes they create a whole new way of doing things.

So a broadly disruptive technology might include something like VHS players, which created a new demand for consumer media, supplanting to some extent other entertainment options, including broadcast TV and movie theaters.

On a smaller scale, various types of media tend to disrupt existing types. VHS -> DVD -> streaming content, or vinyl records -> 8 tracks -> cassettes -> CDs -> digital music formats. Things like that.

It doesn't even have to be anything new. Digital music players had been around for a while before the iPod was introduced, but the iPod was really the disruptive technology probably because of timing and design factors.

[seebs]

Christensen's The Innovator's Dilemma looks at this.

Multitasking is a good example. Back in the 1980s, I regularly got into arguments with MS-DOS users who insisted that it was useless for a computer to be able to run multiple applications at once, because that's stupid; you can't use multiple applications at once!

When multitasking became widely available, new kinds of programs became possible, and then once those programs existed, demand came into being.

Basically, it's hard to create demand for something people wouldn't have wanted, but it's easy to create demand for something they currently don't have any desire for, because people rarely desire things they can't conceive of.

[Angakuk]

I think the problem with the Segway is it did not come equipped with a whip antenna with an attached fox tail. That would have made it totally cool.

[Sauron]

Originally Posted by Angakuk

I think the problem with the Segway is it did not come equipped with a whip antenna with an attached fox tail. That would have made it totally cool.

I was hoping for a militarized version. Shaped more like a chariot, with Sidewinder rockets port and starboard, grenade launcher, thermonuclear blast shield, and ablative armor resistant to both disruptor AND phaser fire.

Yeah, that'd be cool.

[lisarea]

Well, a big part of the Segway problem was that when they were trying to build up anticipatory buzz about it, they totally made it sound like it was a personal hovercraft; so a lot of people, including me, hated it right out of the gate.

[Sauron]

Originally Posted by lisarea

Well, a big part of the Segway problem was that when they were trying to build up anticipatory buzz about it, they totally made it sound like it was a personal hovercraft; so a lot of people, including me, hated it right out of the gate.

Yeah, the amount of "WTF? Is that what all the fuss is about?" was so thick you could cut it with a knife.

[seebs]

Demand has to exist for sales, but it doesn't have to have already existed before the product came out. Demand for motion-based game controls was basically nil before the Wii; they had been tried and had failed. The Wii changed what there was demand for.

That said, all of this turns out to be irrelevant. AML's premise is that rich people do this, but really it's more commonly people who believe that they could be rich... And that requires a more fair society which gives them a real chance.