I mean fuck Elon, but y’all know that we could issue people checks right? Like we could do universal basic income and it wouldn’t increase inflation as long as it’s done right. Increasing the supply of money is not the mechanism that causes inflation.
Fiat currency will, by definition incurr inflation. What if money were tied to necessities like a liter of water, kWh of energy, or kilograms of grain?
We’re already straining the resource capacity of the globe, and Americans are an enormous consumer endpoint relative to population size.
Simply issuing more cash won’t create more end products. And when a handful of cartelized retailers control the flow of trade?
Prices are already artificially inflated to accommodate marketing costs and profit. Why retailers continue to raise prices to catch that additional free cash?
There is enough food produced globally to feed everyone alive and still have some left over.
The problem is a large portion of it goes bad in the grocery store because no one buys it and it ends up in a landfill.
The problem is a large portion of it goes bad in the grocery store because no one buys it and it ends up in a landfill.
More broadly speaking, it’s poorly stored and distributed. But yes, we do a miserable job of keeping people fed.
That’s actually complex issue. Trivial model would probably suggest it will cause inflation proportional to the amount of created money. But market behavior is complex and you could get away without inflation if checks were small enough.
The bigger issue would be government creating money directly circumventing Central Bank - that perverts political incentives and is potentially a downhill towards catastrophic collapse
Ok Elon, could you point to just one historical example of a government printing money and a deflationary trend happening as a result? Just one example should be easy to come up with if he’s so confident that printing money will not cause inflation, but rather deflation.
This is actually true though. Basically every country has done it.
If printing money results in enough value created, there is no inflation.
Of course, you have to create a lot of value per money printed, which no country has achieved. And that’s where taxes come in and fill the gap.
Many of the “economic miracles” involved printing a lot of money. But since their value output increased so fast, (and again, taxes) they experienced little inflation.
It is theoretically possible to print money without taxes and not have inflation. That would be more than a miracle though. If you get even more efficient with money, even deflation would happen.
It’s the same reasoning behind debt. Debt is “bad” because you have to pay more than what you were paid. But if you are smart with that money and create more money from it, you can pay back the debt (including interests) and get some extra money for yourself.
Well with fiat money we do that basically all the time and don’t have a run away inflation
We do print money and we have steady inflation, but inflation is still inflation.
A lot of people seem to be clinging onto the wrong concept here. Nobody is arguing against the reality that the government can print money to pay it’s own debts or solve an economic crisis, because they obviously do it all the time and sometimes the damage done from the inflationary reaction caused by printing more money is significantly preferable to what the alternative could have been (severe recession, economic collapse, etc.).
The point I am trying to make is that Elon is making a specific claim that printing money has a deflationary effect, which I have personally never seen evidence of, no economist has ever seriously theorized, and flies in the face of common sense and human nature.
Reverse inflation: delete a proportional 3/4 of the 1%'s money. Just delete it. G o n e .
I think this is a more global problem of “people now think they’re experts on everything, and shout about it loudly”
Musk is the classic high profile example, but science denialism among the general populace is the low profile one.
And I hear, “well, they always have.”
I dunno… I don’t think the average person in 1926 assumed they were an expert on medicine or physics or finance or whatever. If a doctor, or physicist, or banker told them something, they’d generally nod their head.
Now? “What do they know!?” The notion is offensive, apparently. Clearly their ten minutes of research on Google or ChatGPT refutes 30 years dedicated to centuries-old scientific bodies.
Or maybe they just misjudged some YouTube or Facebook post as an expert, I guess.
Even if I’m wrong there, and people were always like this, the other half is that they weren’t able to shout it into an algorithm that absolutely loves the controversy it generates, and serve it to billions of people automatically.
NO ONE would see this post of Musk, otherwise.
I always say, there was always the village idiot who was talking dumb shit but you just kind of nodded along and offered the to drink another beer so they go and bother someone else. But they were largely isolated and never got in contact with each others.
Nowadays, with social media, all the village idiots can, and do network with each other.
Social Media is the source of 90% of the stupidity in the world today
don’t think the average person in 1926 assumed they were an expert on medicine or physics or finance or whatever. If a doctor, or physicist, or banker told them something, they’d generally nod their head.
So many of those professionals were just professional scammers back then. Until the professionalization of these fields, in the 1940s/50s, you really couldn’t trust them. And avoiding people who claimed to do surgery/treat cancer, while keeping all your money in your mattress was genuinely a smarter move.
the other half is that they weren’t able to shout it into an algorithm that absolutely loves the controversy it generates, and serve it to billions of people automatically.
A lot of this shit is amplified and filtered to operate as it’s own native advertising.
The shit opinions that align with the marketing agenda are the ones that get front-paged.
And to be fair nodding your head to bankers was often not a good idea. And doctors killed patients because they refused to wash their hands.
The problem is a lot more nuanced than trust the experts. Experts in publicly exposed fields have just very often shown incompetence or just blatant corruption that a growing part of the population just lost institutional trust.
Vaccine denialism was a problem during the Spanish Flu epidemic in 1918.
In the eighties, I remember that Christian Scientists would refuse medical treatment for their dying children, choosing to pray instead. The kids usually died.
There was always a subset of the population who refused to acknowledge science or expertise.
These days, we’ve gotten rid of the government departments of experts that are supposed to advise our legislators regarding the consequences of the bills they want to pass. Instead they just listen to the lobbyists of the corporations who finance their campaigns.
Or in the case of Trump, his own imagination, since he hallucinates more than Google Gemini. A recent example is his belief that the CHIPS act requires the hiring of trans folk to run microchip-making factories. (It doesn’t. Also the rumor that he confused transgender with transistor is probably false.)
Elon Musk is a fucking idiot that doesn’t know how anything works. Tax the rich.
He knows how to grift.
He knows how to abuse employees
He knows how to strip businesses of their value for short term gain
He knows how to strip businesses of their value for short term gain
That one is not clear. He never seems to get any gain from his businesses.
Nah.that would create the illusion they contribute something. Exterminate them.
Tax and also eat. I’m excited for KFR - Kentucky Fried Rich.
The world needs to get over this “rich people must be geniuses” fantasy.
How many examples of fantastically wealthy absolute morons do we need?
When you start looking into extremely wealthy people you start noticing that the majority started out life on 3rd base with pockets stuffed with cash and family connections to help them make more.
Elon Musk is a racist moron. He used family wealth to make acquisitions 99% of us can’t make and that’s how the momentum started. He is not an engineer. He doesn’t create anything. He just buys companies and takes credit for the employee’s work.
The ultra-wealthy are not only not geniuses, but they might be downright incompetent.
The most recent episode of How Money Works (here on YouTube) demonstrates this during the recent bonanza of tech layoffs (these include the AI layoffs, attributed falsely to replacement by AI automation).
The story it tells starts with the COVID-19 epidemic and lockdown, which lead to mass telecommuting and then the great replacement. The working class got a modicum of class consciousness since it was clear that their jobs were necessary and involved skills that would be difficult to replace.
The tech industry had developed its own culture from this and had gotten used to being able to openly negotiate their salaries, and the C-suite didn’t like that. In fact, the billionaire class openly resents the workforce on which it depends.
And thus, they laid off a ton of people. Too many, it turns out. It started with the RTO mandates, some of which were intended to incentivize workers to voluntarily quit. And some of them did. Specifically, the best and brightest talent were the ones most confident they could get work elsewhere at better pay that still allowed telecommuting.
So the billionaire class, via the great layoff, facilitated their own brain drain.
And now those same tech companies have found they’ve gotten rid of too many people, including essential talent that actually knew how to run the businesses (and the technology). So they’re now hiring them back. The greybeards are negotiating at an advantage, and are asking for higher salaries. And the ones that are no longer available are being replaced with rookies fresh out of college.
So yeah, the tech industry billionaires, out of pure vindictiveness, collectively fucked themselves.
I hypothesize our billionaire class got rich in their early careers through a combination of fortuitous opportunity, family connections, infusions of generational wealth and ruthless willingness to sabotage their peers. Then they were subject to years of sycophancy and cronyism where they were shielded from any criticism. They gladly assumed they earned their lot, and got there because they are brilliant. At that point, having immense wealth, it’s difficult to not fail upwards, and so they don’t actually see the difference between skillful decision-making and incompetence.
Sadly, incompetence with extreme amounts of money is very dangerous, and so we have the high lords playing their games of thrones and wrecking the world for the rest of us.
I think maybe Musk is an idiot
I don’t understand how an entire tech industry fell so hard for him.
You should be asking who his publicist is. Whoever they are, they are very good at what they do. The only reason we all figured out Elon is a trash fire nazi is either he stopped listening to the publicist or he fired them and went rogue.
That’s actually a good point
Because nobody’s told you, or because you don’t want to?
They aren’t necessarily exclusive of one another though. It could be both.
True, and they wouldn’t have a way of knowing which.
asking Musk about his thoughts on the future of artificial intelligence. Musk said many things that he’s said before, including that AI will deliver an age of abundance, where “anyone can have anything they think of.”
Context matters.
Also how is this a shit post?
That makes it much more of a shit post. Should’ve been included!
Just to be clear, we do quite litterally print money and hand it around in time of crisis, and as a literal component of our economic development strategy.
For example, there was no reason Obama was obligated to focus on saving the banks per se. That same money could have gone to home owners instead. They chose to do it the way that they did. Likewise during covid.
we do quite litterally print money and hand it around in time of crisis
The US Treasury borrows from the Federal Reserve on assets that are added to the Federal Reserve balance sheet. And then the Treasury pays back the debt incrementally over the period of the loan (often on the order of 10-30 years). So it isn’t “literally printed”, it is borrowed at the Federal Reserve Prime Rate, which is typically less than the growth rate of accumulated tax receipts by year.
For example, there was no reason Obama was obligated to focus on saving the banks per se. That same money could have gone to home owners instead.
Absolutely. TARP was some bullshit used to prop up bank equity value at the expense of homeowners.
But the principle behind TARP was that the US government exchanged currency for equity stake in these failing firms. And the firms that recovered then bought back the state at marginally higher face value, which allowed the Treasury to book a profit for every business that hadn’t outright failed already. Over the life of the program, the real cost to the Treasury was minimal (arguably profitable, depending on who you believe).
The Treasury could have bought up mortgage notes instead, at pennies on the dollar, and started collecting interest on the debt just like the private banks had. Then they could have renegotiated mortgages of underwater homes at lower interest rates, while the private sector lenders filed for bankruptcy. That would have drastically reduced the foreclosure rate and dumped the material cost of the financial crisis on stock and bond holders of these private companies.
But in either case, we weren’t just printing a bunch of crisp new dollar bills (or their electronic equivalent) to fund the purchase. We were effectively doing the Vulture Capitalist trick of borrowing against the assets we’d just purchased, at an interest rate that was below the expected return value of the assets.
The US Treasury borrows from the Federal Reserve on assets that are added to the Federal Reserve balance sheet. And then the Treasury pays back the debt incrementally over the period of the loan (often on the order of 10-30 years). So it isn’t “literally printed”, it is borrowed at the Federal Reserve Prime Rate, which is typically less than the growth rate of accumulated tax receipts by year.
And those dollars borrowed from the Federal Reserve… where do they come from?
I think the point is that since these dollars are borrowed, they must eventually be repaid with interest, so on the long run, they will be removed from the economy and they don’t produce inflation like if it was free money. Now, if the government can just allow itself to get a greater amount of debt every few years and only pay the interest, it may lose its meaning…
The balance sheets of the Fed’s depositors.
You know… I was going to shitpost outright infinite money theory.
The government is a sovereign country. It can print money all day long. And based on your comment, it could print print money against bonds to fund a better life for all.
I mean this is a shit post, but I’ve also added that we could feed and house the poor.
And based on your comment, it could print print money against bonds to fund a better life for all.
Yeah, but at that point why print money against bonds? Just nationalized the Make Things Nice Industry and start handing nice shit out to people.
I mean this is a shit post, but I’ve also added that we could feed and house the poor.
We do feed and house the poor. But then we harass them with bill collectors and eviction notices a few years later. Interestingly, it’s the send bit that’s more expensive.
The Treasury could have bought up mortgage notes instead, at pennies on the dollar, and started collecting interest on the debt just like the private banks had. Then they could have renegotiated mortgages of underwater homes at lower interest rates, while the private sector lenders filed for bankruptcy. That would have drastically reduced the foreclosure rate and dumped the material cost of the financial crisis on stock and bond holders of these private companies.
I’m curious how this action would have changed the last 20 years of politics? Those in power during that time did a shit job of really explaining why the banks got the money and not the homeowner. I think this really exposed who the federal politicians were representing, and it wasn’t the everyday voters. I think that anger and sense of betrayal that the American people were told to “kick rocks.” while the actual criminals got a bailout of our money still sits in with of most of the population.
I’m curious how this action would have changed the last 20 years of politics?
Optimistically? It would have spared us a decade of people scrambling for affordable housing as unemployment skyrocketed. It might have spared us the Tea Party backlash of '10 and subsequent economic contraction in '14 that mopped up what was left of midwestern liberal democrats. Spared us a BLM riot or two, without tens of thousands of unemployed people taking to the streets in Missouri and Delaware. Might have forestalled a lot of the rush towards Silicon Valley techno-fascism, too, while keeping more industrial business domestic and preventing the ratcheting of tensions with China and Russia internationally.
But maybe not. Maybe people would have been just as angry for different reasons. It would still have been too little, too late to salvage the pre-'08 economy. And we’d have plunged off the cliff a little sooner or a little later, under a slightly different administrative structure.
I think this really exposed who the federal politicians were representing
Idk how your eyes are widened to the corporate strings tugging at Obama/Biden and miss the even bigger strings hooked onto Mitch McConnell and Paul Ryan.
Unfortunately, I think the vulgar analysis of '09 is fundamentally correct. Americans woke up to a black president and, for a healthy chunk of them, that was a bridge too fucking far. The US could have been a paradise in 2010 and they still would have tossed all the liberals out.
The bailouts became a talking point. And Dems who made a career of trying to defend them were the first on the chopping block. But we still ended up sending Hillary Clinton over Bernie Sanders to fight the Big Orange Cheeto. And progressives lost downticket over and over again, often to a deluge of media ad buys and an army of professional political hatchet men. All of this was happening under the toxic cloud of Epstein-ism and AIPAC-backed genocide and horrifying pogroms in Latin America, Central Africa, and the Pacific Rim.
I learned how this wouldn’t work in grade school. What are they teaching rich white South Africans these days?
We all hate Musk but isn’t Musk suggesting Universal Basic Income?
No. That would be achievable through reallocation of funds, e.g. from tax revenue. If the quote is correct, that’s just increasing monetary mass, aka printing money. Which is Inflationary AF.
That being said, I find it hard to believe that a CEO in this day and age wouldn’t have at least this basic understanding of how the economy works. This being Musk, there’s no need to invent extra character flaws. The man has plenty to go around.
A cynical view is that he does understand and is just shitposting and muddying the water around UBI
I find that quite plausible.
find it hard to believe a CEO wouldn’t understand
Being a CEO is an actual disease that causes measurable cognitive decline. These are literally the dumbest fucks on the planet.
Its a cover. Saying populist ideas without any intention to support them or help them come about is just a way to hide his real actions under a veneer.
Well, the text says “you could actually get deflation because there will be so much abundance produced”. There is some reality where this is true, as increasing the monetary mass would do nothing if the economy (the amount of goods and services produces) increases proportionally. But I wouldn’t bet on a universal basic income increasing the country’s production.
Also, only the rich and upper-middle class would suffer from inflation. Poor people’s financial situation would still improve.The printing money wouldn’t be enough. You’d also have to legislate what people are not allowed to do after the money printing begins (like rent hikes equal to the average household size * the ubi check).
Which you already have to do, because there already is inflation. I don’t see how a UBI would change anything if the inflation stays the same.
The only way this makes sense, and I guarantee he’s not advocating for this, would be to print and distribute so much money to the lower and middle classes that the upper class wealth is diluted and inequality is reduced. But the havoc that would wreak outside of the US is something I can’t even speculate on.
But even that wouldn’t do a thing to them - their value isn’t stored in money, so any inflation would only hurt the people who’s value is.
How do you get UBI without issuing checks from the Treasury. There isn’t enough tax money that can be taken from Billionaires to sustain UBI.
Not just tax a percentage, but take every penny of every Billionaire in the US. Net worth of all US billionaires is 8.4 Trillion.
270 million US adults.
= 31k per person. Once.
That’s 31k one time. Then there is no money for next year.
Net worth of all US billionaires is 8.4 Trillion.
The productive capacity of the accumulated capital owned by US billionaires exceeds $31k/person/year.
The “Net Worth” figure is deceptive, because it’s the exchange value and not the use value. Sitting on tens of millions of vacant real estate units, many of which are underwater on their purchase price, shows up as far less on an individual balance sheet than the material benefit of not being homeless accrues to a homeowner.
The productive capacity of the accumulated capital owned by US billionaires exceeds $31k/person/year.
If that was true then taking all their capital and distributing it would be more than $31k/person/year for each individual receiving their share of the 8.4 Trillion.
Yup.
So it doesn’t change anything. You get $30k and yes that $30k is worth more because it can generate maybe $3k in investment income for you a year. It’s still only $30k.
So it doesn’t change anything.
It does, in fact, change things
Nobody said it had to be over $2500/month?
Minimum wage in many US cities is $15/hr which is $30k/year.
Even at federal minimum wage of $7.50, that means not just taxing Billionaires at 100% but taking everything will give you 2 years of UBI before there is no money.
Minimum wage in many US cities is $15/hr which is $30k/year.
So? UBI isn’t a wage for work. It could be $300/month and that would still be a huge boon to struggling people.
The UBI baseline is supposed to be $12000 per year. The premise is it covers food and shelter.
So why did you inflate it to nearly 3x that amount while arguing about how it can’t work because it’s too expensive? $1000/month is still a lot of money for people.
I just looked over the interview. it was fucking WEIRD man. He’s kind advocating for a UBI? Basically he’s saying that AI is going to give us the whole Star Trek “post scarcity” future thing and like money is simultaneously going to be useless, but that how that could happen is the Treasury could just give people checks and inflation wouldn’t be an issue because the AI would be creating so much abundance. It’s genuinely hard to parse
It’s part of the grief, hyping AI and his robots while promising that he’s gonna give money after they replace the workforce. Guess what happens next?
Yeah, I remember what this fuck did to California’s high speed rail.
Yeah, billionaires like UBI because they can pretend they care about the plebs, but in reality they know it will just cause inflation, which there stocks won’t be effected by, and push even more money into the stock market to protect against inflation, inflating there portfolio.
The plebs will then realize it’s not working and then be skeptical of any program designed to help the poor. UBI is a poison pill for the left.
Musk isn’t suggesting a UBI in the form that has already been tested successfully without inflation. Like any government expense, the funds are typically raised through taxes.
How is a guy who says too much was spent on food stamps and foreign aid going to like the budget to produce a livable UBI? It’s basically selling people a pipe dream to justify cutting current social services, and then we can colour us all shocked when UBI either never rolls out or is like $5 per person
Dictators and hyperinflation, name a more iconic duo.
Inflation is good for musk, it means his investments make more money
Let’s all not be naive here
In the short term. But you still need a stable currency for international trade. So far, the US has managed to keep the dollar strong(ish) especially with regard to our oil and tech exports. And they’ve done this after floating over $30T in debt, no small feat.
Idk if Musk Bucks meaningfully change that math. So maybe it’s fine. A few hundred billion, which is still barely a percentage point on the national economy.
But it does add stress to an already inflated system.
It works if you pull money out of the economy and retire it with taxation.
That definitely helps. Although still have to contend with money velocity, which is why you need to adjust the prime interest rate on new debt
