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(Yahoo)   What happens when the rich stop spending. Well, the poor sure aren't going to get us out of this one   (finance.yahoo.com ) divider line
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15138 clicks; posted to Main » on 19 Jul 2010 at 8:12 PM (6 years ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



221 Comments     (+0 »)
 


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2010-07-19 02:35:23 PM  
Tell me again how spending is the linchpin for this whole thing? Isn't there, like, making stuff somewhere in there?

.
 
2010-07-19 02:45:25 PM  

DistendedPendulusFrenulum: Tell me again how spending is the linchpin for this whole thing? Isn't there, like, making stuff somewhere in there?


Well, if you just have people make a shiat load of widgets and there is nobody buying widgets, then you end up with a shiat load of widgets in the garbage and nobody is any better off.
 
2010-07-19 03:00:29 PM  

EatHam: DistendedPendulusFrenulum: Tell me again how spending is the linchpin for this whole thing? Isn't there, like, making stuff somewhere in there?

Well, if you just have people make a shiat load of widgets and there is nobody buying widgets, then you end up with a shiat load of widgets in the garbage and nobody is any better off.


OK, lemme ax you dis. Do we make eight useless and really, really expensive widgets and hope to fark that the rich people buy em from us, or do we make two million useful widgets, price em so regular folks can afford em?

.
 
2010-07-19 03:07:29 PM  

DistendedPendulusFrenulum: OK, lemme ax you dis. Do we make eight useless and really, really expensive widgets and hope to fark that the rich people buy em from us, or do we make two million useful widgets, price em so regular folks can afford em?


There are a couple of steps you've skipped there, one of which being to determine whether anyone wants these widgets at any price point.
 
2010-07-19 03:15:52 PM  
There was a time in American economic history when the linchpin for our entire economy wasn't the spending habits of a very small segment of the population. I wonder what happened.

i887.photobucket.com

I do believe I feel a trickle of anger. Yes, it's quite distinct.
 
2010-07-19 03:18:43 PM  

EatHam: DistendedPendulusFrenulum: OK, lemme ax you dis. Do we make eight useless and really, really expensive widgets and hope to fark that the rich people buy em from us, or do we make two million useful widgets, price em so regular folks can afford em?

There are a couple of steps you've skipped there, one of which being to determine whether anyone wants these widgets at any price point.


Really, really useful doesn't count?

___________________________

Hey, rich guys, in our abject worship of some abstract idea called Free Market, we let the fox guard the henhouse and totally farked up our economy. Please, please buy more yachts than you can possibly farking ever use at once!

.
 
2010-07-19 03:32:41 PM  

DistendedPendulusFrenulum: Really, really useful doesn't count


Not if people don't want them it doesn't - you'll be out of business anyway.

DistendedPendulusFrenulum: Please, please buy more yachts than you can possibly farking ever use at once!


Well, that's more likely than funding widget construction without any sort of planning and estimating how many will be sold.
 
2010-07-19 03:36:13 PM  

EatHam:
Well, that's more likely than funding widget construction without any sort of planning and estimating how many will be sold.


Too dense to make sense to. Not continuing this. You go on slobbering over how the rich are some finite resource that we can't do without. When it comes down to farming in the back yard and hanging out the wash on a clothesline, drop by and I'll show you how it's done.

.
 
2010-07-19 03:40:09 PM  

DistendedPendulusFrenulum: You go on slobbering over how the rich are some finite resource that we can't do without.


When did I say that?
 
2010-07-19 05:11:43 PM  

DistendedPendulusFrenulum: OK, lemme ax you dis. Do we make eight useless and really, really expensive widgets and hope to fark that the rich people buy em from us, or do we make two million useful widgets, price em so regular folks can afford em?


Are you Henry Ford re-incarnated or something?

Seriously, there's only so much the top .01% can buy (5.5m/yr). The top 0.000267% make 87 million or more a year, and they comprise 400 households.

Even factoring in the top 1%, that only accounts for 5% of the income on the whole of the US, based on median household income and total households.

/I always wondered what that figure was. Glad someone finally made me go run the numbers.
 
2010-07-19 05:22:51 PM  

DistendedPendulusFrenulum: You go on slobbering over how the rich are some finite resource that we can't do without.


Are you...kidding? You know what keeps an economy afloat? A healthy middle class. This has been true since the invention of economies. You may not think the serfs are worthwhile, but enough of them get pissed and they'll storm your friggin castle.
 
2010-07-19 05:23:38 PM  
Ok, that was misquoted. I meant that for EatHam.
 
2010-07-19 05:30:07 PM  

EatHam: DistendedPendulusFrenulum: Really, really useful doesn't count

Not if people don't want them


That's why you need a good marketing department.
 
2010-07-19 05:47:10 PM  

what_now: Ok, that was misquoted. I meant that for EatHam.


That's why I liked it.

tallguywithglasseson: EatHam: DistendedPendulusFrenulum: Really, really useful doesn't count

Not if people don't want them

That's why you need a good marketing department.


It pains me, but EatHam is begging the question. The original idea (I can't believe I am explicating this) is that "really, really useful" translates to stuff that people want, need, and can afford.

He'll be back, of course, to say "but the widget you are talking about would be a commercial flop," even though this is a hypothetical widget whose attributes I DEFINED.

*SIGH*

.
 
2010-07-19 05:58:43 PM  

DistendedPendulusFrenulum: He'll be back, of course, to say "but the widget you are talking about would be a commercial flop," even though this is a hypothetical widget whose attributes I DEFINED.


No. My point is that it is not a choice between only having "the rich" spend money and only having a bunch of hippies pool their resources to make widgets out of unicorns and leprechaun farts in their open air factory. Things work best when they work together - like it or not, you need people with capital to fund things like widget factories. The people there get paid, and are then potentially able to purchase widgets.

If you just start cranking out widgets without that capital involved, you are far more likely to fail.
 
2010-07-19 06:04:31 PM  
EatHam:

You gave yourself away with the unicorns bullshiat. You're still arguing that the product is worthless and no one wants it, which I predicted you'd do.


:)

Gotcha.

.
 
2010-07-19 06:12:40 PM  

EatHam: Things work best when they work together - like it or not, you need people with capital to fund things like widget factories.


TFA is about consumption (consumer outlays, including spending on goods and services, interest payments on consumer debt and cash gifts) by the wealthy. Not about investing in unicorn widget factories, which is actually up 12 parsecs.
 
2010-07-19 06:18:09 PM  
Goimir:


Are you Henry Ford re-incarnated or something?


More like Bernard Kroger.

.
 
2010-07-19 06:25:19 PM  
HMMM...then you see something expensive that nobody needs and people flock to pay too much anyway. iPhone, iPad, etc...
 
2010-07-19 06:35:21 PM  

DistendedPendulusFrenulum: You're still arguing that the product is worthless and no one wants it, which I predicted you'd do.


I am arguing that you don't know if the product is worthless or not. Maybe it isn't. But even if it isn't, someone has to pony up some cash to get you to 2 million widgets produced. Who's doing that?
 
2010-07-19 06:40:20 PM  

EatHam: DistendedPendulusFrenulum: You're still arguing that the product is worthless and no one wants it, which I predicted you'd do.

I am arguing that you don't know if the product is worthless or not. Maybe it isn't. But even if it isn't, someone has to pony up some cash to get you to 2 million widgets produced. Who's doing that?


As was explained to you earlier, the article is about the spending of rich people, not about their investment in my superior product that everyone wants, needs, and can afford.

:)

.
 
2010-07-19 06:48:46 PM  

DistendedPendulusFrenulum: As was explained to you earlier, the article is about the spending of rich people, not about their investment in my superior product that everyone wants


DistendedPendulusFrenulum: Tell me again how spending is the linchpin for this whole thing? Isn't there, like, making stuff somewhere in there?



Sorry if I misunderstood, it wasn't clear that's what you meant.
 
2010-07-19 06:59:05 PM  

DistendedPendulusFrenulum: You gave yourself away with the unicorns bullshiat.


Ah but you started it, and you gave yourself away in your second post (thank god it wasn't your first or I might have typed Boobies) when you said:

DistendedPendulusFrenulum: Do we make eight useless and really, really expensive widgets and hope to fark that the rich people buy em


That statement shows that you don't know what you're talking about. That statement is just as much a straw man as EatHam's sarcastic unicorn thing - except that you weren't being sarcastic.

The answer to your question is "no." No, we don't make just eight widgets. No, we don't make useless widgets. No, we don't "hope" that people buy them. Make things useful. Make as many as the market will support. People will probably buy them and the rich will definitely buy them - if only to be trendy. The issue is that if you remove the rich from that equation, you remove the one thing you can depend on.
 
2010-07-19 07:06:50 PM  

Tofu: DistendedPendul[...] trendy. The issue is that if you remove the rich from that equation, you remove the one thing you can depend on.


To tell the truth, I was really thinking in terms of how much economic activity is generated by the rich as opposed to the activites of the ninety and the nine, such as buying bread and air filters and socks and shiat. Besides, if times are bad, incomes are down, and the rich squander all their money on trendy bullshiat, there won't be any capital to start up industry when things begin looking up. If the rich are hedging, it's a likely sign they don't want to become poor like the rest of us.

.
 
2010-07-19 07:35:36 PM  
frak it, let us print our own money.
 
2010-07-19 07:52:00 PM  
DistendedPendulusFrenulum: Please, please buy more yachts than you can possibly farking ever use at once!

That's personal spending, and actually does provide a fair amount of work. All the talk of widgets is business spending. Different things all together.
 
2010-07-19 08:12:23 PM  

WhyteRaven74: DistendedPendulusFrenulum: Please, please buy more yachts than you can possibly farking ever use at once!

That's personal spending, and actually does provide a fair amount of work. All the talk of widgets is business spending. Different things all together.


A yacht's not a widget?

.
 
2010-07-19 08:15:03 PM  
www.worstpreviews.com

Haw haw
 
2010-07-19 08:18:40 PM  
So I guess there goes the whole "lower taxes on the rich creates jobs" theory. With the zero estate taxes this year and the Bush tax cuts still in effect the rich should be creating jobs left and right, no?
 
2010-07-19 08:18:48 PM  
To just about everyone in this farking thread

www.gnorb.net
 
2010-07-19 08:20:26 PM  
What's all this talk about wedgies?! How are wedgies supposed to drive the economy?

Are we supposed to pull ourselves up by our own thong straps? Is that what you mean?
 
2010-07-19 08:21:30 PM  
Let's just tax (the rich) and spend our way to prosperity. The Fark liberal elite have convinced me it is the only way.
 
2010-07-19 08:23:00 PM  
"One of the reasons that the recovery has lost momentum is that high-end consumers have become more jittery and more cautious," said Mark Zandi, chief economist for Moody's Analytics.

Well, if dope was legalized, these jittery types can be encouraged to smoke a bowl or three and calm down, and we'd all be better off.
 
2010-07-19 08:24:05 PM  
Is the thread where peasants come to beg permission to suck at the teats of their betters?

*skims thread*

Yup.
 
2010-07-19 08:24:38 PM  
Who would have thought that there's a middle ground between "let the rich live tax free" and "someone who has more than me doesn't deserve it"
 
2010-07-19 08:24:43 PM  

Thrag: So I guess there goes the whole "lower taxes on the rich creates jobs" theory. With the zero estate taxes this year and the Bush tax cuts still in effect the rich should be creating jobs left and right, no?



It appears despite making them absurdly richer and showering them with the support of millions of middle class (lower class, shhhh, dont tell them) sycophants that love jesus, budweiser and wearing shiat kickers.... they still only care about themselves.


Never put much stock in the 'rich create jobs' after they tried to ship every job worth a shiat overseas to save a farking penny.

Some of the IT jobs have come back at consumer demand. The industrial jobs are probably gone for good.

There's only one thing their very good for, Eat the Rich.
 
2010-07-19 08:24:44 PM  
couldn't the government just take their money and spend it for them.
 
2010-07-19 08:24:57 PM  
I like to argue on the internet as well.
 
2010-07-19 08:26:00 PM  

DistendedPendulusFrenulum: Tell me again how spending is the linchpin for this whole thing? Isn't there, like, making stuff somewhere in there?

.


Somebody has to buy the stuff you are making other wise you are just piling up stuff. Just ask Government Motors.
 
2010-07-19 08:27:34 PM  
Anyone else find it interesting that the biggest, most useless, pointless fad during "expensive" oil and a gusher in the gulf are shaped rubber bands?
 
2010-07-19 08:28:01 PM  
LOL, Smitty, they didn't get rich by writing a bunch of checks.

They got rich off the oppression of the black man, duh!
 
2010-07-19 08:29:05 PM  
memeticpress.files.wordpress.com

"haha. That sucking sound I told you about? That was your ecomony leaving, for good. You thought you could have an information/consumer economy. Ain't no such thing"
 
2010-07-19 08:29:41 PM  
Goimir

Even factoring in the top 1%, that only accounts for 5% of the income on the whole of the US, based on median household income and total households.


Uh, citation please? Every study I have read puts the top 1% making exponentially more than 5% of the income
 
2010-07-19 08:29:47 PM  

Thrag: So I guess there goes the whole "lower taxes on the rich creates jobs" theory. With the zero estate taxes this year and the Bush tax cuts still in effect the rich should be creating jobs left and right, no?


One of the skills of those who effectively manage their finances is to not live day to day or paycheck to paycheck. When they see the massive tax increase looming on the horizon, it alters their behavior. They think and plan for tomorrow, which is why they will always be at least one step ahead of those who cannot seem to learn that simple lesson.
 
2010-07-19 08:31:47 PM  

Krikkitbot: DistendedPendulusFrenulum: Tell me again how spending is the linchpin for this whole thing? Isn't there, like, making stuff somewhere in there?

.

Somebody has to buy the stuff you are making other wise you are just piling up stuff. Just ask Government Motors.


The question is, if the rich start buying up a bunch of junk, is that going to fix any fundamental problems?


.
 
2010-07-19 08:31:47 PM  
I've noticed that the quality of the shoes I buy isn't what it used to be. Strange, with all these shoe stores you'd think one of 'em would make a decent pair of sneakers.
 
2010-07-19 08:31:51 PM  
I'd like to further clarify the 'rich create jobs' angle. It can be correct, from a certain point of view.

What I would call upper middle class, successful private business men and woman that make 6-7 figures a year are the people that create jobs. You can call them rich and not be wrong, i just think of them as successful and enterprising.

They create business, commerce and are entities we can count on to support their local towns and give a crap about investing in this country.

Then there are the guys that are raking in 8 figure salaries+ with stock options and jets and handjobs from little boys from Thailand will rape this country for everything it's worth. As they are doing right farking now.

If you have two brain cells to rub together you would get that we SHOULD tax the living crap out of the latter. Why? How did they get so rich? What great society let them achieve such greatness?

Oh, that's somehow communist and blah blah *blow my brains out insert stupid here*

But go ahead, anyone, defend the latter. Tell me how they are the american dream and epidemy of what we all should strive to be.

How they are out 'gateways to industry' and whatever other stupid people would like to sell today.
 
2010-07-19 08:33:32 PM  
What happens when the rich stop spending?

Their money, which in of itself has no real value, becomes useless except as a limited means of cooking and heating.

I wonder what they would do then?

Next question, please.
 
2010-07-19 08:34:40 PM  

Supracentral: Thrag: So I guess there goes the whole "lower taxes on the rich creates jobs" theory. With the zero estate taxes this year and the Bush tax cuts still in effect the rich should be creating jobs left and right, no?

One of the skills of those who effectively manage their finances is to not live day to day or paycheck to paycheck. When they see the massive tax increase looming on the horizon, it alters their behavior. They think and plan for tomorrow, which is why they will always be at least one step ahead of those who cannot seem to learn that simple lesson.


You may suck at the teat of the aristocracy, but you're still a farking peasant at heart.
 
2010-07-19 08:35:17 PM  

EatHam: DistendedPendulusFrenulum: OK, lemme ax you dis. Do we make eight useless and really, really expensive widgets and hope to fark that the rich people buy em from us, or do we make two million useful widgets, price em so regular folks can afford em?

There are a couple of steps you've skipped there, one of which being to determine whether anyone wants these widgets at any price point.


I think that's why he included the adjective 'useful'. It implies an already existing market for the product. If there is a demand, the only question is of tailoring your production to meet demand and determining price so demand doesn't fall or you get our competed by another widget manufacturer.
 
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