Owning productive assets is a tortured use of the word hoarding.
edit: Hoarding is buying assets that could be used productively and storing them somewhere instead of using them. People with a political axe to grind like taking words with negative connotations and applying them to things that don't make sense to manipulate you.
If you think about it for more than two seconds you will understand we already have a word that describes someone with a lot of assets, "wealthy" or "rich". So hoarding as a term only makes sense when used in the context of someone stockpiling something that could be used by people in need. "Hoarding" shares in a company does not make sense for example.
I’ll bite. Of every dollar you contributed to your 401k last paycheck, how many cents of them do you think you’ll actually spend in retirement, on a risk-adjusted basis?
For me, the answer is certainly not 100 and not 0, let’s say it’s 80 cents. Speaking for myself, I think that marginal 20 cents is by definition hoarding because the marginal utility of money to me at that point is negligible.
Sure it could benefit my kids or get me a nicer retirement home. But there are kids that are homeless, and our public education system is crumbling. I personally would much rather those 20¢ be redistributed to people who need it. Just speaking for myself.
It's not about personally using the money or marginal utility. By investing the money in the stock market, you are increasing the pool of money that is going into funding businesses (directly and indirectly).
Think of it this way:
Angel investors and venture capitalists are directly funding the creation of new productive businesses with the expectation of a future return / reward. This future reward is only possible with secondary markets such as the public stock exchange. Additionally, employees at these companies are typically rewarded with shares to align incentives. These stock based grants motivate them to work harder and produce more and this is only possible because they can then go and sell their shares on the public market.
An example of hoarding would be like someone buying a bunch of property to park their wealth with low risk but not renting out any of the homes or apartments they purchased because it's too much effort.
I’d argue it’s still about marginal utility, but you’re talking about second order marginal utility. That is, by increasing the amount of wealth that’s locked up in equities, you’re “funding progress”.
I would still posit that the second order marginal utility of those 20 cents is higher in hands of somebody who needs it. In the same way you talk about how that 20 cents impacts the derivative of “progress”, think about how those 20 cents would impact the derivative of the people it’s redistributed to.
It’s my opinion that there’s no better ROI than investment in early childhood education, for example. Because it’s an investment that pays compounding dividends integrated over an entire human lifetime.
And again, we’re not talking about removing the whole dollar from the market, just 20 cents. An amount, by the way, that is around what would be taxed if you were investing in a non-tax-advantaged account. There’s some irony in there.
> I would still posit that the second order marginal utility of those 20 cents is higher in hands of somebody who needs it. In the same way you talk about how that 20 cents impacts the derivative of “progress”, think about how those 20 cents would impact the derivative of the people it’s redistributed to.
The innovation that happens because people build companies and technologies that they go on to sell in public markets impacts every single human going forward as long as there is not a disaster. Meanwhile, the 20 cents of marginal utility is used once and according to the recent study on how people used a universal basic income, not to great effect.
You only need one transistor, vaccine, airplane, refrigeration level invention every few decades to justify how much more impactful it is.
> The 20 cents of marginal utility is used once and [...] not to great effect.
I made no reference to UBI. I don't think UBI is a solution to the system of poverty. But we don't need to go there.
There are ways to redistribute wealth that are less direct than SNAP and UBI.
The public education system, our transportation infrastructure, the funding of basic research (which contributed to the transistor, modern vaccines, and modern passenger air travel).
There is a whole spectrum of investment between "give a man a fish" and "fund the construction of a competitive industry of privately-owned fish farms to feed people fish"; and it's worth understanding why we're often presented with the false choice between them, instead of the options in between. It's not because the one on the right is most efficient.
>If you think about it for more than two seconds you will understand we already have a word that describes someone with a lot of assets, "wealthy" or "rich".
Semantics? I think your first metaphor for productivity was better. Are you simply buying a yatch you use twice in your life ever, or are you living your dreams of sailing the deep blue in a flashy way? Or in the gray area; do you turn it into a business to have other rich people pay to ride?
How you use your assets or liquidity matters a lot more than what medium you store it as. =
edit: Hoarding is buying assets that could be used productively and storing them somewhere instead of using them. People with a political axe to grind like taking words with negative connotations and applying them to things that don't make sense to manipulate you.
If you think about it for more than two seconds you will understand we already have a word that describes someone with a lot of assets, "wealthy" or "rich". So hoarding as a term only makes sense when used in the context of someone stockpiling something that could be used by people in need. "Hoarding" shares in a company does not make sense for example.