How the Wealth Gap Drives Imbalances in Global Trade & Finance | Michael Pettis

[@HiddenForces]

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[@michaels4255]

Great interview. I always like hearing Pettis, a really smart guy who can connect the financial dots as few can.

[@coogee126]

Great interview. Michael pettis is a bloody genius. 🥰🥰He needs to write lots of books ....to share his deep knowledge about economy, history. Host is also very professional, ask quality questions and interact well with Michael.

[@charpentierdamien6601]

Was waiting to hear from Mr Pettis again for a very long time. Thanks

[@assertivekarma1909]

A perspective that needs to be discussed more widely. Great work!

[@seanwieland9763]

Thank you Demetri for injecting some sanity by pointing out asset price inflation!

[@praveenrai6965]

Great interview!

[@moremileyplease4387]

Just bought his new book, my first from him, now that I know about it.

[@mannysingh4715]

@27:15 somebody simplify explain this..how did they inflate away the debt?

[@nicolasbechara4686]

Can anyone help with the name he mentioned at 19:05 Alexander Gors..? Thanks

[@samfindlay4775]

Alexander Gerschenkron

[@richardchen9912]

wow this is a really complicated stuff that I might need to relisten a few times to really understand

[@supreme7738]

i back on my 3rd lol

[@thebraziliangardener8481]

its worth it though

[@seanwieland9763]

Inequality is a feature not a bug. Stable and scalable distributions of wealth are by definition Pareto power law distributions, not normal bell curve distributions. See the work by Barabasi on Scale-Free Networks.

[@nonenone8201]

Fascinating. This guy is has a way better vantage point on China vs what Ray Dalio is always talking about.

[@eliterun6214]

Interesting perspective so far (16 min in). I am a bit skeptical of taking his thesis as the sole, or even most important driver of saving rates however. Demographics are probably as much if not more important as people consume/save differently at different ages. We’ll see if he addresses

[@anjankatta1864]

Demographics are under appreciated, thanks for bringing it up

[@sandymilne224]

That’s an excellent point which Dimitri should have injected into the discussions.

[@tommyt1785]

Good interview with former England soccer coach Fabio Capello.

[@prumvirak2781]

The most recent interview with Prof. Pettis is here: kzbin.info/www/bejne/gaq8e2SfqLudaas

[@seanwieland9763]

Misallocated capital (malinvestment) and capital consumption are literally the same thing. Anything that is unprofitable is by definition consumption (waste).

[@RichHamilton777]

This guys is similar, yet even less interesting than my economics university professor that simply pointed at charts and graphs all class. “If this goes up, than this goes down!” Ok we get it... any way to add some color to this conversation?

[@kreek22]

Savings rates are driven by government decisions, government characteristics are driven by "cultural variables"--therefore savings rates are driven by culture at one remove.

[@seanwieland9763]

“Pushing wages down”... what a roundabout way to actually say what Jim Rickards said in Currency Wars. The problem is the collision between national currencies (monetary policy) with transnational capital flows. The solution isn’t to make capital flows illiquid/nationalized. The solution is to let national fiat currencies fail - as all fiat currencies must eventually do.

[@schumanhuman]

Government creating public goods does not in itself solve the problem because landlords will still take the majority of the gains. The way to capture the externalities of investment, public or private is to tax it. A land value tax. That is not redistribution, but a return of the value created by the community which is otherwise an implicit subsidy to the landowner. Joseph Stiglitz wrote about this with his 1977 parer on the Henry George theorem. en.wikipedia.org/wiki/Henry_George_theorem We can measure the effects of investment by looking at the effects on local real estate prices. This was done here in the UK with our Jubilee train line extension in the 1990's, which cost around 3.4 Billion to finance but created a land value uplift around the new stations in excess of 11 billion, more than enough to pay for the investment over just a few years of LVT. Instead landlords pocket most of the gains and renters pay 3 times, via taxes, higher rents and forgone capital gains.

[@seanwieland9763]

schumanhuman there’s no such thing as “the community”. It’s methodological individualism entirely.

[@schumanhuman]

​@@seanwieland9763 Urban land value is almost entirely determined by agglomeration effects, which are determined by all the positive economic activities in the area. That is everyone and no one in particular, which could be called the community.

[@seanwieland9763]

schumanhuman wrong. It’s always and everywhere simply supply and demand. Prices are discovered by the subjective value of consumers.

[@seanwieland9763]

schumanhuman again, there’s no such thing as “the community”. Only individuals think. Only individuals act. “Society” is nothing more than the summation of individual actors.

[@schumanhuman]

@@seanwieland9763 ? Even if that were so it doesn't contradict my point about agglomeration effects. Just seems like you're trotting out standard Austrian market worship rather than addressing my point.

[@milhousevanhouten3796]

China has the highest investment rate because when they exchange dollars for RMB, the Chinese central bank creates new RMB to exchange. If they didn't RMB would skyrocket.

[@milhousevanhouten3796]

@Teringventje Nonsense, they have more credit/debt than the United States its just calculated differently.

[@ronallan8680]

This Podcast made me feel like plankton. I hate being plankton

[@robertraystevens]

yaaay

[@markhartman6836]

And pension funds sucks to be him

[@seanwieland9763]

“Excess savings”... already this is a joke. 🙄

[@seanwieland9763]

As the interview goes on, he doesn’t mean actual savings. He means inflation caused by government monetary expansion.

[@laurentdrozin812]

Actually excess savings are a thing. It's just that those savings are so concentrated at the moment, that nobody on the streets can see them. What do you think happened to all those trillions created after the 2008 crisis? Excess savings, that's what happened. Just not in your pocket, or mine.

[@seanwieland9763]

@@laurentdrozin812 there's no such thing as "excess savings" or "hoarding" wealth. It's all reinvested. People don't have Scrooge McDuck moneybins filled with gold coins. It's kept in banks deposits to back bank loans, or invested into stocks, bonds, etc. One person's savings is always someone else's investment capital.

[@laurentdrozin812]

@@seanwieland9763 I would argue that today's stock market has more in common with McDuck's moneybin than a fruitful investment. Oh, the valuation increases, but that is mostly due to liquidity inflation, not really fundamentals. The current developments are proof of that.

[@seanwieland9763]

Teringventje lol, of course savings of real resources is always constrained. We don’t live in a post-scarcity world.