Quote:
Originally Posted by Neal Stevens
(Post 1887274)
FB's value is their userbase, the platforms they create, and their acceptance as the king of repeat visitors. They essentially have all the land alongside the information highway and plenty of companies want to erect billboards on this land. That's their value, and as long as FB manages this well, they will make money. Real money, not abstract :)
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No. Think it to the end. I admit, it is a very long chain, but still - try to think it to the end. Facebook produces nothing and creates nothing. No real value it creates at all, and the value (in the meaning of money) now spend for its shares -ideally - would represent the monetarian value of some other real assets: products, land, anything. Which means the money representing real values (the latter meaning) noiw suddenly is sucked up by something that represents no real values. In other words real assets get annihilated to value up unreal, non-real assets (FB). The ral value has not been increased, but to compensate the loss of money representing real assets, new money gets printed and brought into circulation, with inflation and all the rattail of unwanted follow-onb effects. So: while the buyer of FB shares may or may not make a short-termed gain when buying and selling FB shares, there still is a devaluing taking place that is absorb and compensated by the whole and complete system. It is a an intrinisc design flaw that temporary money theory and economc "theories" cannot evade, tried to solve and so far completzely have failed to solve, since centuries. And since as long it creates one cultural fall, one economic collapse after the other.
Economic theory even has a special term for it and recognises it as un unsolvable problem, but for the present moment the term just does not come to my mind.
If you think now that it is a very basic problem for any capitalistic monetarian system in general, than you are right. It is. That'S why capitalists tend to act as if it did not exist.
With the known results that hit civilisation every couple of time cycles. Provloem is that frequency and amplitude of such problems are accelerating by several factors in modern time, speeded up by the increased pace of modern industrial societies.
I grant you your monetarian win if your FB buys turn out to be profitable in the longer run. It's just that you have not formed and that FAB has not formed up additonal real value when that happens. A cost equivalent to your gain, and then plus X, has been also created, the price is higher than your gain, and even if the whole system and all the others swallow it, it nevertheless adds to the many other individual gains that come at a equivalent cost + X. Somebody has to pay for it, and it could be any part of the global system and communities.
So do not be surprised about the next econiomic-finacial crashdown. It is just a question of time. Profits like yours - drive the process of frequent collapses, since they keep the whole system running from one spike to the next in the race for "eternal growth" - instead of trying to maintain a dynamic balance that keeps things in a state of slightly fluctuating stability and size of human civilisdation tailored to what can be supported by this stable balance. That would be what "Nachhaltiugkeit" really means. We are lightyears away from that. And that is why I am pessimistic about human global civilisation.
From nothing comes nothing, lead does not turn into gold. It is so easy a fact to understand, but greed seems to blind people over it.