Wealth.

[joe-90]

Where does it come from on a global scale? I can understand where individual profit comes from or even countries but where does wealth actually come from?

 

[D_Hailsham]

but where does wealth actually come from?

Out of the ground.

 

[lifesagasman]

wealth is a man-made concept. in it's earliest form, if you had more food than someone else you were more wealthy. and someone might kill you for it. not much different now, really

 

[mark vincent]

In Norman England the English raised pigs and the Normans ate them, things are still the same.

 

[lifesagasman]

spooky!!...

 

[mark vincent]

Or you put your money into the bank and you get 0 per cent interest, the bank then loans you your own money and charges you 10 per cent interest i think that creates wealth.

 

[oompah]

Ice from Iceland
Greens from Greenland
Pounds from poundland.

 

[BingoBongo]

who are all these countries in debt to?

 

[skitzee2k]

who are all these countries in debt to?

Anyone and everyone. Governments sell a type of 'share' which they will make sure they [pay back with interest...so people give them money knowing they will get X amount back.

 

[lifesagasman]

who are all these countries in debt to?

Anyone and everyone. Governments sell a type of 'share' which they will make sure they [pay back with interest...so people give them money knowing they will get X amount back.

wouldn't you like to expand on that, schiz??

PS i 'thanked' one of your posts. you're almost redeemed....

 

[holmslaw]

Wealth used to be based on the monetary value of tangible assets, the most recent being gold.

Today wealth is based on someone elses debt, when a UK bank makes a loan of a £1,000,000 the wealth of the UK and the bank increases by the same amount.

 

[Norcon]

Hard working people create wealth. People who work their butts off in other words.

But the banks create the situation in the first place for the wealth to be generated by conjuring up money out of thin air.
The government give their backing to this scam.

http://www.youtube.com/watch?v=vVkFb26u9g8

That's how I see it anyway.
To give an example my brother borrowed 20k, twenty five years ago.
He was penniless but had a lot of building work on and needed plant to expand his business.
He purchased a digger and some shuttering. He has paid all that off a long time ago and now owns plant and civil engineering equipment worth probably about 250k and premises for his business worth probably another 250k.
He doesn't need the bank anymore but it was thanks to the bank for getting him on his feet.

 

[empip]

Winston Churchill (1875 - 1965): Land, which is a necessity of human existence, which is the original source of all wealth, which is strictly limited in extent, which is fixed geographical position –- land, I say, differs from all other forms of property in these primary and fundamental conditions.

-0-

 

[Lincsbodger]

Winston Churchill (1875 - 1965): Land, which is a necessity of human existence, which is the original source of all wealth, which is strictly limited in extent, which is fixed geographical position –- land, I say, differs from all other forms of property in these primary and fundamental conditions.

-0-

I agree.

The orginal pupose of conquest was to obtian slaves, goods and Land.

SO then you have a system where i now own the land, and ill let you stay as long as yo uwork for me or give me food/goods for the privelege.

That evolved into you giving me gold instead, so now, we exchange goods base don gold coinage. Coinage was the first big step after barter.

The next step was the invention of Bank Notes. Instead of you hauling all that gold about, you put it in my bank, and i give you a note saying you did. Thats as good as gold, because i g'tee ill give the gold to whoever has the note.

Now i have your gold, and you have the note for it, i know yo uwont want it all back soon, so ill lend it to someone and demand more gold back then they borrowed. I have just created money out of nothing by a process called 'Interest' , in fact ive invented credit.

And thats it. Almost all the wealth in the world is based on hypothetic wealth, based on bank promissory notes.

Futures trading is another way to make wealth. You sell iron ore, and today the price is £1 a ton. So ill buy 100 tonnes, but ill pay you the price it is in 3 months time, and we'll settle up then. So in three months time, the price might have risen to £1.10 a ton, so ill pay you £100 and then immediately sell it for £110. You dont have to deliver the iron ore, all we do is swap paper.

Even more obscure is Credit Default Swaps. I own a company, and i want to borrow £100. So rather than go to the bank, i sell you a Conpany Bond, and you give me £100. This allows you to collect share bonuses like a shareholder, but you cant vote. After one year, you might have collected £10 in share bonuses, but then i have to give you your £100 back and the deal is complete. This assumes my company makes profit and can pay you shes bonuses and makes the £100 back.

Now, you might not , so just in case you go to joe-90 and ask for insurance. So Joe sells you a Credit Default swap. You give Joe half the share bonuses i give you, and then if I cant give you your £100 back, then he has to, so you cant lose, you've passed the risk to Joe. Now HE prtects jimself by also buying insurabce, and so on and so on, sharing the risk with many people, so if i cant pay the £100, then it may be 10 people all nd up paying out £10 each to you, because they accepted 1% of the share bonuses.

And thats where it all fell down - two or three big companies folded, taking CDS insurers with them, and the whole pack of cards fell down. Hedge funds (which is where rich people put money to make more money and not pay tax on it) had invested heavily in CDS's and some hedge funds vanished overnight, lost to CDS insurance payouts.

Credit is based on someone somewhere taking a risk with someone elses gold.

 

[lifesagasman]

very good, lincs. just not sure i'd buy insurance off joe90. i'll think about that one