User Tag List

View Poll Results: People in finance are typically:

Voters
12. You may not vote on this poll
  • Wealth creators

    4 33.33%
  • Wealth takers

    8 66.67%
123 Last

Results 1 to 10 of 25

  1. #1

    Default Creation or Acquisition of Wealth? : Finance

    It seems there is a lot of conversation about "wealth creators" and the idea that rich people to get richer by getting a bigger share of the pie, but by actually creating new wealth...that it is not a matter of getting rich by taking money from others, but by creating new wealth that wasn't there before.

    I think we should start off by acknowledging that both processes happen. People get rich by creating new wealth, and people get rich by taking things from others. If you don't believe both processes are happening, I believe the burden of proof is on you. We have both Google and Enron as examples of each.

    To discuss ideas about wealth creation, I want to make a series of thread regarding aspects of entrepreneurship.

    Let's start with finance. What is it's value? Do people working in fields like insurance, loans, investment, trading, make their money by creating new wealth, or essentially bilking others out of their money?

    We can think about insurance (for example). We can imagine two types of scenarios regarding how insurers make money (with many specific modifications and combinations that can be made for each):
    1) They pool money from a lot of people's premiums when times are good and for when things go wrong. They create new wealth by investing in things that will reduce the risks, or the costs of things going wrong, and thereby reduce the costs of pay-outs in a manner that makes them money.
    2) They take money in through people's premiums, and then find loopholes and excuses for not paying out, and thereby make money through "fine print" and fooling people into buying "protection" that has no value.

    Which of these mindsets do you believe typifies the world of finance, right now?

    Do people in finance more often create wealth or take the wealth of others?

    Accept the past. Live for the present. Look forward to the future.
    Robot Fusion
    "As our island of knowledge grows, so does the shore of our ignorance." John Wheeler
    "[A] scientist looking at nonscientific problems is just as dumb as the next guy." Richard Feynman
    "[P]etabytes of [] data is not the same thing as understanding emergent mechanisms and structures." Jim Crutchfield

  2. #2
    pathwise dependent FDG's Avatar
    Join Date
    Aug 2007
    MBTI
    ENTJ
    Enneagram
    7w8
    Socionics
    ENTj
    Posts
    5,908

    Default

    Well, point 2) is illegal...
    ENTj 7-3-8 sx/sp

  3. #3

    Default

    Illegality doesn't stop people from doing it. Also, people of the mindset that creates 2) are good at finding ways to follow the letter of the law while violating the spirit of it.

    Accept the past. Live for the present. Look forward to the future.
    Robot Fusion
    "As our island of knowledge grows, so does the shore of our ignorance." John Wheeler
    "[A] scientist looking at nonscientific problems is just as dumb as the next guy." Richard Feynman
    "[P]etabytes of [] data is not the same thing as understanding emergent mechanisms and structures." Jim Crutchfield

  4. #4
    Administrator highlander's Avatar
    Join Date
    Dec 2009
    MBTI
    INTJ
    Enneagram
    6w5 sx/sp
    Socionics
    ILI Ni
    Posts
    17,904

    Default

    "People in finance" is really too broad to allow an answer to your question.

    Insurance companies do what you say in option 1. They try and avoid people who will result in losses to begin with - that is they don't want to insure them. If they had a reputation for not paying claims then people would flee and go to insurance companies who did. My experience with property and casualty insurers has been very good. Healthcare insurers - not so much.

    Please provide feedback on my Nohari and Johari Window by clicking here: Nohari/Johari

    Tri-type 639

  5. #5
    Senior Member ptgatsby's Avatar
    Join Date
    Apr 2007
    MBTI
    ISTP
    Posts
    4,474

    Default

    Quote Originally Posted by ygolo View Post
    To discuss ideas about wealth creation, I want to make a series of thread regarding aspects of entrepreneurship.
    I guess when talking about finance, the first question I have is...

    Who funds the entrepreneurs? Could the financial institutions be removed in that equation?

    I don't believe so; finance is fundamental for all wealth creation. The legal structure and the institutions themselves are certainly debatable, but my experience is that corruption runs about as deep as the political process (finance and politics being very intertwined - I would even put forth that governments are essentially finance entities). Finance facilitates wealth the way computers facilitate efficiency, even if a company isn't in the business of finance or technology.

  6. #6
    & Badger, Ratty and Toad Mole's Avatar
    Join Date
    Mar 2008
    Posts
    18,536
    Quote Originally Posted by ygolo View Post
    Do people in finance more often create wealth or take the wealth of others?
    Australia is a mercantile nation. We trade not only to make money but to reach the holy grail of mercantilism which is to make our money the Reserve Currency of the World.

    We have noticed recently the Russians buying Australian dollars, even though we don't trade with them. So perhaps we shouldn't have been surprised when just the other day the International Monetary Fund (IMF) made the Australian dollar a Reserve Currency of the World.

  7. #7
    Permabanned
    Join Date
    Sep 2010
    Posts
    2,152

    Default

    Wealth is static...you don't create it, you manipulate it.

    Those who accumulate it, (the takers) and those who give it away (the manipulators) do so because that's what they are motivated to do.

    At the end, you find peace with your role and focus on other things.

  8. #8
    Senior Member Lateralus's Avatar
    Join Date
    May 2007
    MBTI
    ENTJ
    Enneagram
    3w4
    Posts
    6,276

    Default

    The finance industry does not create wealth, directly. It can create wealth indirectly, through choosing which businesses to fund. But the finance industry's interests do not always align with our nation's interests. This is something Republicans refuse to admit and Democrats only acknowledge rhetorically.

    I don't think any reasonable person would argue against the idea that the finance industry is vital for a healthy modern economy, but I believe it must be heavily regulated. Why? Because it's too important. Finance should be viewed more like a public utility than a casino as it is right now. The way to do this is through full disclosure of everything (failure to comply being a felony with mandatory prison time, the buck stops with the CEO). This is something Wall Street has opposed with all of its might because the last thing it wants is for the general public to know what it's actually doing.
    "We grow up thinking that beliefs are something to be proud of, but they're really nothing but opinions one refuses to reconsider. Beliefs are easy. The stronger your beliefs are, the less open you are to growth and wisdom, because "strength of belief" is only the intensity with which you resist questioning yourself. As soon as you are proud of a belief, as soon as you think it adds something to who you are, then you've made it a part of your ego."

  9. #9
    Senior Member Mal12345's Avatar
    Join Date
    Apr 2011
    MBTI
    IxTP
    Enneagram
    5w4 sx/sp
    Socionics
    LII Ti
    Posts
    13,993

    Default

    Quote Originally Posted by xisnotx View Post
    Wealth is static...you don't create it, you manipulate it.

    Those who accumulate it, (the takers) and those who give it away (the manipulators) do so because that's what they are motivated to do.

    At the end, you find peace with your role and focus on other things.
    The belief that wealth is static is based in false Marxist propaganda which is easy to knock down. And such a simplistic falsehood exemplifies why I can never be a Marxist.

    http://www.city-data.com/forum/polit...th-static.html
    'A conservative friend recently told me he had a liberal friend who believed that wealth in the world is static and cannot be created. If this argument were true, then the liberal argument would make more sense regarding redistribution of wealth.

    The problem as I see it is that this is a totally bogus argument to begin with. Take the following example:

    Only two people live on a deserted island. In year one, person 1 works 80 hours per week building a house, making tools, planting a crop, building a boat for fishing, and making a fire-starting device.

    Person 2 spends the first year eating fruit and leftover fish from person 1 and the rest of their time lying on the beach and relaxing.

    At the end of year one, the island has more wealth than it had at the beginning. The island has shelter from storms, fire for heat and cooking, crops for variety of food to eat, and a boat for transportation around the island. Converting some of the islands resources into more usable items while creating creature comforts "created wealth".

    Now whether person 1 should be forced to share his wealth with person 2 or whether person 2 should get off their ass and get to work is a different argument. My question is, how would a person who believes in static wealth get around this simple scenario? Would honestly like to hear the other argument.'
    "Everyone has a plan till they get punched in the mouth." Mike Tyson
    “Culture?” says Paul McCartney. “This isn't culture. It's just a good laugh.”

  10. #10
    Senior Member UniqueMixture's Avatar
    Join Date
    Mar 2012
    MBTI
    estj
    Enneagram
    378 sx/so
    Socionics
    esfp
    Posts
    3,038

    Default

    Mhmm I am uncertain about this thread. I wish insurance pools were national to decrease rates as much as possible. I wish our insurance industry was more like Japan's with hard price controls to keep costs down, but since this country is so much larger and has much more variation in wealth distribution doing something like that is impractical at best. I do think it is the only way to reign in these industries that society is so dependent on while still allowing them to function privately.
    For all that we have done, as a civilization, as individuals, the universe is not stable, and nor is any single thing within it. Stars consume themselves, the universe itself rushes apart, and we ourselves are composed of matter in constant flux. Colonies of cells in temporary alliance, replicating and decaying and housed within, an incandescent cloud of electrical impulses. This is reality, this is self knowledge, and the perception of it will, of course, make you dizzy.

Similar Threads

  1. The veil of ignorance, or ignorance of the veil?
    By figsfiggyfigs in forum Philosophy and Spirituality
    Replies: 67
    Last Post: 05-06-2011, 02:21 PM
  2. Replies: 1
    Last Post: 01-09-2011, 10:47 PM
  3. Brilliant ideas, "AHA!" moment or pursuit of perfection
    By Penguin in forum General Psychology
    Replies: 13
    Last Post: 11-18-2008, 07:57 PM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
Single Sign On provided by vBSSO