Gyroscopic Investing

I just realized that purchasing a 30 year bond is a bit like buying a share of a 30-year contract of bondage of your fellow countrymen. Ultimately, the money that is paid back to you is extracted from the population.

https://en.wikipedia.org/wiki/Debt_bondage wrote:Debt bondage, also known as debt slavery, bonded labour, or peonage, is the pledge of a person's services as security for the repayment for a debt or other obligation.

The 30 year bond is a 30 year pledge of services by the population. It is repayment for the banker's privilege of creating money out of thin air, for us to use in the present.

Wealth creation isnt zero-sum, if you loan me a tractor we can both have more food

Money out of thin air is more complicated...if you want instant access to savings you should get 0 interest or even pay a storage fee. If you want interest the money should be locked up to prevent bank runs. We have moral hazard now because Wall St can count on a bailout. So I'm looking into leveraged funds =)

But if you buy gold, you’re supporting a market where the working conditions are often abysmal.

boglerdude wrote: ↑Wed Jul 03, 2024 11:59 pm Wealth creation isnt zero-sum, if you loan me a tractor we can both have more food

Money out of thin air is more complicated...if you want instant access to savings you should get 0 interest or even pay a storage fee. If you want interest the money should be locked up to prevent bank runs. We have moral hazard now because Wall St can count on a bailout. So I'm looking into leveraged funds =)

I agree that wealth creation isn't zero sum.

Money out of thin air was referring to the practice of the federal reserve creating money then using it to purchase bonds. The profits from this undue privilege are not reserved for the nation, they are paid out to the Fed's shareholders:

https://www.federalreserve.gov/aboutthefed/section7.htm

So, returning to your point that wealth creation isn't zero-sum. Indeed. However, it's clear that some of the wealth we create is being siphoned off, and not being used for the benefit of the nation. And as generation after generation remarks, "things just ain't the way they used to be", it seems to me that the host is being drained of its vital energy.

dualstow wrote: ↑Fri Jul 05, 2024 8:45 am But if you buy gold, you’re supporting a market where the working conditions are often abysmal.

Yeah, I wasn't really making a moral claim about owning bonds on your fellow countrymen. I suppose it's better that citizens own these bonds than foreigners.

I know. I almost put in a “I know you’re not saying…” but didn’t bother.
It just jogged a memory.