/biz/ - Business & Finance

>>18735153
the GDP isn't al dente af desu

>>18735163
What did you mean by this?

Comment on this?

>>18735153
What is GDP(PPP)?

Still, you’re mostly right. GDP in bullshit metric

>>18736157
>>Still, you’re mostly right. GDP in bullshit metric
Any redpills on GDP out there? No search engine will give you criticism of GDP.

>>18735153
In domestic politics I agree GDP (PPP) per capita or GDP per capita growth rates are superior.

In foreign, I disagree e.g. if you're comparing Russia vs. Germany in terms of FDI capacity: GDP is important.

GDP girls are the hottest in porn

>>18736397
>GDP (PPP)
Is even more insane and wrong then normal GDP or do you want to explain how every your country getting every investor in since the cost of operating there is low is a bad thing?

>>18736397
>In foreign, I disagree e.g. if you're comparing Russia vs. Germany in terms of FDI capacity: GDP is important.
Explain how GDP is calculated and what it exactly means.
I bet you have no idea what you are even talking about.

Classic economic magical thinking.

>>18735153
How about you just fucking adjust for inflation to calculate rGDP or rGDP/capita. There's no need for this thread, everyone knows GDP is an elementary metric

>>18736198
Any high school economics teacher will criticize GDP this isn't rocket science or some redpill

>>18736525
>How about you just fucking adjust for inflation to calculate rGDP
Because that's impossible! If you eliminate all inflation (keep in mind that not all inflation hits all metrics at the same time and in the same way) GDP growth will be ZERO because this is not how any of the parts of how GDP is calculated work.

>>18736587
Name some criticisms

>>18736599
Your dumbass calculation gets you zero because you have to use a base year relative to the current year. It's about seeing the value relative to a time point in the past
>>18736623
crticisms:
1) it doesn't account for inflation as OP pointed out. Country A in 2020 may have a higher GDP while also being less wealthy than Country A in 1999. You can't think in nominal values.
2) per capita aspect is also needed. For example, Country A has a population of 100 Million and Country B has a population of 5 million. They have the same GDP, but this doesnt mean the average person has equal financial means. People in Country B are much better off despite the same GDP

>>18736623
https://www.thebalance.com/what-is-real-gdp-how-to-calculate-it-vs-nominal-3306040

>>18736753
>Your dumbass calculation gets you zero because you
No you have no idea what GDP even is. Tell me how its calculated. Tell me what I input to calculate GDP then try to defend this crazy notion.

>>18736788
Total values of private consumption + gross investment + government investment + govt spending + (exports - imports) gives you nominal. Previous link shows conversion to real GDP.

>>18736836
>Total values of private consumption + gross investment + government investment + govt spending + (exports - imports) gives you nominal.
Great! Do you know what these words mean?

Its literally people spending money. Its all there is its just people spending money nothing more.

The only growth in the nominal GDP was because the prices of everything increase so people buying shit gave you a bigger number.

Here is the key question how the fuck can there be something like rGDP growth if its just people spending money on shit? Correct for inflation and you get zero.

Since no one can (hold this thought since macro speaking it will be true) spend more then 100% of the money he has its literally impossible to have rGDP growth.
>muh credit cards
So someone else lets you spend his money this can not be made for the entire economy however and is only a diversion in the long run.

rGDP growth is impossible GDP was a bullshit measurement form the start and a trick.

To harem this home all GDP growth is correlated and a result of M0 growth. And no one has time to wait with bullshit games where the government calculates inflation differently to make its magical GDP numbers go up.

>>18736980
Because wealth is not a zero sum game in the modern era (and no the creation is not due to inflation)
Here:
https://www.quora.com/How-is-wealth-not-a-zero-sum-game

>>18736980
Your logic applies to a 1600s economy

>>18737162
I see where your brain short circuits:
>Herp derp these facts assembled in this way demonstrate how my religious dogma is bullshit
>CAN NOT QUESTION RELIGIOUS DOGMA!
>Herp derp you are wrong! Because I can not question my religious dogma.

>wealth
Doesn't exist. Keep posting more nonsense from your religion.

>>18737189
>Your logic applies to a 1600s economy
Nice assertion and discarded. Prove any of that or how about you actually do what I asked you and answer how people spending money on shit can result in any growth.

>1600s economy
Can you spend more then 100% of the money you have? Do you have some IRL glitch where spending money will not decrees the number in your bank account or something?

>>18736442
>>18736464
>>18736623
>>18736788
>>18736980
>>18736599

This dude is bonkers - but, at least it's relatively on topic. Sorry OP, your thread died for this.

>>18737306
>This dude is bonkers
Say where I made a mistake.
And reconsider your life if you know that all you have is
1) Be ignorant idiot
2) Funny economist man says smart sounding words
3) Belive everything economist man says
4) never question what the economist programmed into you
5) Thin you are smart for repeating smart sounding words that you have no idea what they are about.

You quite literally have nothing outside of this.

>>18737291
Ok let me make this extremely simple for you, and we'll use gold instead of dollars to eliminate the variable of inflation.

Let's say the amount of gold on earth is completely constant for 100 years. During that 100 years, the number of assets in different classes INCREASES. I start with 10 oz of gold. I pay 1 oz of gold for a hammer. I use hammer to create something worth 20 oz of gold. My net worth is now 29 oz gold. Money supply has not increased, yet wealth was created. As long as their is a market for the asset, wealth creation can be realized, even with a constant money supply

>>18737419
Over time, gold supply is constant, but the amount of total assets increases.

>muh everyone is wrong but me

you know inflation is more than just money printing right
more economic activity = more borrowing = inflation
this is the brut source of inflation which is why even now with the massive stimulus injection nothing is happening to inflation because economic activity is basically dead

>>18737491
Horrible analogy. A Pile of shit obviously doesn't provide value to anyone. Meanwhile a house can. If someone builds a house it has monetary value and demand.

>>18737291
>Can you spend more then 100% of the money you have?
Imagine two people trading $100 for labour back and forth 5 times. Even though there is only $100 in circulation $500 worth of labour was generated. GDP might not be a good measure of productivity if their labour consisted of jerking each other off but it's an ok indicator of the size of a market. It's more a measure of financial opportunity. If you want to measure productivity it would make more sense to analyze each industry on it's own but GDP gives an ok overview "at a glance".

>>18737562
yeah, if someone does it with stuff that provide value it's ALSO measured.
but the point is that all the worthless stuff that just passes money back and forth is measured with the exact same weight. the more middle-man an economy has that provide no value, the higher its gdp output will be.

also the house is wealth. it doesn't matter if it changes hands 5 times over a period of 10 years, or only once, those additional exchanges generate no value, but they generate 5 times more gpd.

>>18737419
>Let's say the amount of gold on earth is completely constant for 100 years
I disagree here. Personally I use the fictional adamentium that there are only 100 KG EVER in the entire simulation

>the amount of gold on earth is completely constant
This says nothing are we talking in circulation or in the ground? Because people diging up gold is not different from printing it. Adamentium is given to only exist in circulations and be impossible to dig up anywhere in the universe.

>INCREASES
Yep no problem there.
> I start with 10 oz of gold.
Ok.

>I pay 1 oz of gold for a hammer
Ok.


>I use hammer to create something worth 20 oz of gold
This literally makes zero sense you have gone full insane at this point. What do you mean create? What you create depends only on what others are willing to pay for your garbage.


You extremely quickly realize the nonsense you have written if you track all the gold/adamentium in ownership.

There is only 100 KG of adamentium in existence you have 99KG of adamentium. It will be literally impossible for you to get more then 1KG of adamentium for whatever you make since literally no one has more then 1 KG of adamentium. You can write down that number yet literally no one will be able to pay that much.

>yet wealth was created
Literally insane nonsense word injected here. Its like a computer short circuiting and throwing out random garbage at this point.

Try to simulate what you are talking about because what you posted is insanity/sophistry depending on how desisted your brain is.

Simulate what you are talking about or its nonsense.

>>18737476
You realize inflation only exists because fancy people decide to increase the price just because. Right?

And they do this based on other assumptions that are well known.
>Whats this the fed is printing more money?!
>Time to increase the prices of everything I sell!

If these special people don't decide to do this there can be no inflation. There can be shortages however.

>>18737491
I like this.
Only why do these dudes look so happy even if they say they feel sick?
>>18737562
>Horrible analogy.
Look the neocon speaks!
>doesn't provide value to anyone
Yet the GDP formula will count this under consumption! Do you even know what you are defending here?

Show me where the GDP formula says to remove socially undesirable activity from consumption and what this socially undesirable activity list is?

>>18735153
GDP is great!

>>18737491
>>18737577
>Imagine two people trading $100 for labour back and forth 5 times. Even though there is only $100 in circulation $500 worth of labour was

Lets roll with this then this calculates the speed of moving money around.
And this is ultimately limited by the speed of light.

At some point you realize these people will need to break the sound barrier to keep moving this $100 between one another.

And then computers will need to be constructed to swap money between one another as fast as possible to have a bigger GDP then last year.

And...
And why are we engaging in this stupidity? Why give a shit about this number?

Ultimately even the computers will be blocked by the speed of light.

And this is with your assumption and if we correct perfectly for inflation since most of the time GDP simply measures inflation since the same items you where buying last year cost more now and you are payed more.

Also I hate to burst your bubble however I think there is something preventing this moving of money around, I'm not sure if there are restriction for businesses concerning them not using their profits immediately or if this is not included in the GDP.

However GDP is a trick from start to finish.

>>18737627
>generate no value, but they generate 5 times more gpd.
You should realize that GDP is only a propaganda tool so that plebs get in debt and spend literally everything they get.

>>18737577
>If you want to measure productivity

if you keep high inflation and/or impose all kind of wealth tax, you incentivize everyone to not accumulate and spend recklessly. it will be easy to make money in the economy, but players who want to have wealth will just leave and take their wealth away.
real measurement doesn't just look at how much money is being _received_ ("generated") but also how much is _spent_ (lost).

the overall amount of wealth in an economy (and how that wealth changes over time) is the true measure of its power.

like, how do you measure the success of a trader? you look at how much money he made overall.
one trader can buy and sell the same stock at the same price many many times per year, have billions of volume, but make 0 dollars.

if you measured the success of a trader like GDP measures the success of an economy, those traders would be most successful ones in the world.

>>18737577
>If you want to measure productivity

if you keep high inflation and/or impose all kind of wealth tax, you incentivize everyone to not accumulate and spend recklessly. it will be easy to make money in the economy, but players who want to have wealth will just leave and take their wealth away.
real measurement doesn't just look at how much money is being _received_ ("generated") but also how much is _spent_ (lost).

the overall amount of wealth in an economy (and how that wealth changes over time) is the true measure of its power.

like, how do you measure the success of a trader? you look at how much money he made overall.
one trader can buy and sell the same stock at the same price many many times per year, have billions of volume, but make 0 dollars.

if you measured the success of a trader like GDP measures the success of an economy, those traders would be most successful ones in the world.

>>18735153
>why would [[[ modern academic economist ]]] exclusively use metrics that cast debt and money printing in the most positive light possible?

>>18738091
Now that makes you think!

>>18737722
inflation happens due to money supply expansion, this happens naturally with economic growth, thats why theyre printing in the first place, to try and create artifical growth but it always happens even when theres no printing due to natural growth, the same is true for deflation when theres no growth, look at Japan for example, theyve been printing nonstop since the 80s to fight of but arent experiencing any inflation because they havent had any growth for the past decade and they cant stimulate growth anymore artificially

>>18738174
You just posted a insane and crazy bag of nonsensical assumptions.

>economic growth
bulllshit concept.

Inflation in like prices going up only happens because people in power like the CEO decide to increase the prices and they have people looking what the fed is doing.

If these people did not decide to do this then no inflation would ever happen. This is simply undebatable since we can check what people are responsible for increasing the price of some product.

However if they did not increase the price the product will run out(empty shelves) for example after the money supply increase gets to great. There are other things that happen if you decide to keep the prices at 1970s levels forever with a increasing money supply, not one of them good for the business.

>>18738493
are you 5 years old
price changes are due to basic supply and demand changes
economic growth results with increased spending which causes demand curve to shift outwards causing price to increase, ie. inflation
you have a childish understanding of how markets work

>>18735200
GDP IS NOT
AL
DENTE

>>18737654
On the twin planet there is NO adamentium yet they build houses, grow food and make cars. Is this impossible?

>>18736157
>>18736198
>>18735153
>>18736525

Whew I can't believe nobody has pointed this out yet.

GDP may be meaningless, but it is a statistic. It is what it is. They add up all the final goods and services sold in the economy and add it up. OK thats GDP. But they also try to adjust for inflation, and then report Real GDP.

Nobody pays attention to raw GDP, they usually look at real GDP.

This also happens to be why OP is right, though. We all know that official inflation statistics are manipulated downwards by the powers that be. One example is the Hedonic Adjustments, but there are many others. Nobody actually experiences the CPI or even the PCE rate of inflation -- they are calculated from an index of hundreds of goods combined into a weighted average. I urge you to take a look at this list of goods -- it has all kinds of things that you basically will never, ever buy in your life. It is impossible to come up with 1 statistic that will explain how prices are rising, it is just too difficult.

Anyway, the real scam about GDP comes when they subtract inflation. You see, as long as they eyeball inflation downward from its true value, even if GDP is constant, it will LOOK like real GDP is growing.

This is how you get 1,2,3% growth every year, year in year out. You just lowball inflation by 1-2-3% every year.

But instead of this obvious, obvious explanation, you morons are arguing about stupid bullshit.

ITT morons.

Good for you OP. You're on the right track.

>>18736980
>what is fiat currency?

>>18736198
they dont want the people to know that that +5% gdp increase was just some multinational corps hiring milking immigrant labor even more while the actual citizens are fired and living in hovels.

a better metric would be gdp per person

>>18738493
>decide to increase the prices

>>18740292
nah you're just unable to see things from more than one side.

>>18738649
>Muh bullshit graphs
Imagine being so retarded you actually believe this shit.

Priceless.

You quite literally live in a fantasy land. Peak retardation you have fallen for shitty bullshit named economics.

>>18740292
>This is how you get 1,2,3% growth every year, year in year out. You just lowball inflation by 1-2-3% every year.
Yea exactly. The rGDP calculation simply uses a not complete inflation adjustment and still get excited at growth that quite literally is only inflation since the price of everything increased.

nGDP or rGDP is nothing more then inflation. In the end all GDP is is a bullshit number neocon/neoliberals love to obsess over like its some magical we are better indicator.

>>18739880
The concept of adamentium can be made in real life simply never print any fiat money EVER.

I'm just assuming its a magical metal to explain it better or curve the question of
>b-b-b-b-b what if they print more fiat money

Since gold also experiences inflation, the more people dig out gold the bigger the inflation is. And no one controls it.


Speaking of gold the funny fact is that the gold standard ends if 1 nation gets of the gold standard. No need for conspiracies. 1 Nation gets of the gold standard and now they have their own paper money for their people and can sell their worthless yellow metal reserves to other nations. This creates inflation in other nations and if they also get of the gold standard they get to do the same.

Like with everything else the last ones to get of the gold standard are the suckers who are stuck with worthless yellow metal and inflation. Being on the gold standard is not different from letting other nations print your money.

>>18740897
>a better metric would be gdp per person
GDP is still bullshit regardless how you divide or try to correct it.

Its literally only the number of $$$ people use to buy things. Its in the formula.

You pay $300 for food GDP = +$300. Food prices get up and now you pay $400 for food, GDP = +$400 now.

Wow so much growth! Economy so productive!

And this is all there ever was to it. If a business buys things its also gets added to GDP. Its just people buying things nothing more.

And like >>18740292 correctly pointed out (I found it to obvious and was thinking most GDP cock suckers can understand the offhand comment about bullshit inflation calculations) all growth in rGDP is only there because governments incorrectly calculate inflation to get that extra rGDP growth.
M0 growth is far more correlated to GDP (and even rGDP) growth then whatever the government decides to publish the inflation is.

GDP is only a magic number governments obsess over to fool people at this point.