Since at least 2008, every time there’s an option to either make the money track real value or make sure things don’t go down, they chose the latter. As a result, money is increasingly uncoupled from reality.
From Cory Doctorow’s blog: The actual dead economy risk is that our institutions and markets will continue to move capital from productive activity into memestocks, vibes, and bubbles.
Theranos was ~$10B, FTX was ~$100B, and frontier AI lab is ~$1T. The US government is ~$10T. We are one order of magnitude from the end of too big to fail. If grassroots movements aren’t totally captured and get serious, I have a very good solution.
Every time someone is making money, you have to ask: is this created by growth? If the answer is no, the only other option is who did they take it from? Cruise Automation was founded around the same time as comma. They burned $10B with nothing to show for it. There was clearly no growth, so who lost the $10B? And don’t stop at “the investors” they are just middlemen. Trace it all the way through.
Since 1980, the economy has grown at 2.6% per year. The stock market has grown at 12.3% per year. Compounded, that’s 3.3x vs 220x. Does this make any sense?
It does once you realize that prices can’t go down. That’s simply not allowed. It’s bad for business if prices go down. The economy might collapse if prices go down. And if prices do go down, it shouldn’t happen while our administration is in power. This is America, the land of number go up. That’s why people around the world trust our economy.