<story><title>Three Delusions: Paper Wealth, a Booming Economy, and Bitcoin</title><url>https://www.hussmanfunds.com/comment/mmc171218/</url></story><parent_chain><item><author>philiphodgen</author><text>I look beyond the “there’s a crash coming” sentiment. In that opinion, he is like all other pundits yammering on CNBC: entertaining rather than enlightening.&lt;p&gt;What I like about his article is the insight — new to me — about the nature of paper wealth vs real wealth. He described it in a way that is useful and enlightening to me. The assertion that a security (stock, bond) is not an addition to net wealth — just a zero sum transfer between individuals over time — is a provocative statement that I will ponder for some time.</text></item></parent_chain><comment><author>lmm</author><text>Trade is a wealth creation mechanism, because different people assign different values to things. When a baker exchanges some loaves of bread with a carpenter for a table, wealth is created: they&amp;#x27;re both rational actors who know that the thing they&amp;#x27;re getting is worth more (to them) than the thing they&amp;#x27;re giving away. The same is true when the baker sells bread for money. The same is true when they issue a bond for their baking business. Of course the bond just moves money around, but a lot of wealth creation consists of moving things around rather than directly building a physical thing.</text></comment>
<story><title>Three Delusions: Paper Wealth, a Booming Economy, and Bitcoin</title><url>https://www.hussmanfunds.com/comment/mmc171218/</url></story><parent_chain><item><author>philiphodgen</author><text>I look beyond the “there’s a crash coming” sentiment. In that opinion, he is like all other pundits yammering on CNBC: entertaining rather than enlightening.&lt;p&gt;What I like about his article is the insight — new to me — about the nature of paper wealth vs real wealth. He described it in a way that is useful and enlightening to me. The assertion that a security (stock, bond) is not an addition to net wealth — just a zero sum transfer between individuals over time — is a provocative statement that I will ponder for some time.</text></item></parent_chain><comment><author>psyc</author><text>It’s zero sum for the individual buyer and seller, but in aggregate it’s how the economy decides what work to do.</text></comment>