this post was submitted on 03 Nov 2024
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[–] BallsandBayonets@lemmings.world 21 points 1 week ago (3 children)

Money that is kept and never spent is worthless. Currency has to be used to have value, otherwise it's just paper (or bits). The working class won't hold on to their money, they have bills to pay, groceries to buy, etc. Only the wealthy would hold on to their money, which they're already doing.

[–] Asetru@feddit.org 1 points 1 week ago

That was my point, pretty much. The issue is that money that's kept is useless for society, but if its value increases it gains potential usefulness for its owner. I'm not saying that ordinary people will stop buying food and I'm not saying that corporations are doing community work right now, but the world in which the rich get even richer without even spending their money on something will be problematic at best. The economy will crash while everybody will hold on to whatever moves they have.

Only the wealthy would hold on to their money, which they’re already doing.

to be clear, "holding" on to money is innately going to be investing. Not only is holding onto significant piles of cash incredibly sketchy, it's also really bad financial strategy, because you lose money over time, so you're highly incentivized to invest the money you don't actively need, into something that can do productive work for the market economy instead.

If we're talking corporate money, which is different, and not the type of money you mentioned, things work a bit differently, but generally the mechanism is roughly the same, with some tax benefits, and mechanisms to create productivity rather than provide it instead. There are some funny things you can do like stock buybacks, but those do have some market utility though.