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Old 11-19-2015, 09:43 AM   #19
GGG
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I forgot I posted here

I like to think of the economy like thermodynamics. The 1st law of thermodynamics is that energy can't be created or destroyed only transferred from one medium to another.

Extending this out money is a representation of energy. Human labour plus energy extracted from the ground. So essentially the economy can only expand if we add stored energy into the system via resource extraction or add human energy to the system more people entering the workforce or become more efficient and using either of these sources of energy.

So while on a universe level scale it's a zero sum game on an earth scale the stored energy in the earth in oil,iron, coal etc and the energy from the sun which feeds humans can be converted into economic growth.

However when we reach a point where the cost of energy increases or we stop growing as a population or stop getting more efficient economic growth will slow or stop.

I'm going to grab that book you mention as well. I do agree with you though that the risk management side of an investment adviser is valuable as while I don't believe stock picking is a skill setting acceptable risk tolerance for a probability of an acceptable rate of return is.
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