Current Events — HabitableZone

Current Events » in reply to It doesn't matter how much you invest in a business...

Economics 101

Products are purchased by other producers. That's how it works. It's not "consuming" or "producing." It's trade.

Anybody who adds value to something through work or skill is a producer. Even the guy sitting in the park selling handmade bracelets made out of old spoons is a producer.

Keynesian mythology aside, taking money away from the people who produce goods and services and then turning around and giving it to somebody so they can buy those goods and services isn't really a very effective policy for economic growth. It is good policy for gaining political power in a democracy, though.

The Fed just decided to print a shitload more money out of nothing and pump it into the economy. Each dollar is now worth that much less. This trick doesn't work either. Not for long.

Interesting factoid: It's estimated that the sales of the new IPhone 5 could add as much as a half percent to fourth quarter GDP.

That's where growth comes from. And jobs.

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