Impact of Wealth

Alex Tabarrok does not write much, but provides good material; Paul Krugman writes a lot, and once in a while, comes up with a really good article. I wonder if Krugman really wanted to expound that Economists are useless, unless they are ignored; Some might say he himself is getting more useful every day. Never mind! Rent Control remains a no-brainer issue, except complete reliance on the provision of Rent funds to determine occupancy will, over the long-term, led to congestion.

Dean Baker makes some good points:

The growth in consumer credit overall slowed from a 7.3 percent annual rate in June to a 2.8 percent rate in July. For the revolving debt component (primarily credit card debt), the slowdown was much sharper, from 13.2 percent in June to a 3.4 percent rate in July.

This brings the annual rate of growth in credit card debt over the last three months to 10.3 percent. By comparison, credit card debt grew at an average annual rate of 3.2 percent from 2002-2005.

Baker's interpretation of the data ignores statistics showing over half of American Households hold no Credit Card debt, and also ignores that of those Households which do hold Credit Card debt, they are maxing their Credit limits. These Households lack elasticity to expand their debt ratios, which helps explain the July cutbacks of Credit Card debt growth, and present an ill wind for economic growth.

Greg Mankiw wonders whether Stock Options have much impact on Inequality:

On the other hand, whether these particular public policies have been quantitatively important to rising inequality is less clear. Although the stock market had some spectacular runs in the 1990s, average stock performance over the past decade has been about normal. So I am skeptical that the interaction of stock options with surprisingly good stock performance is a large part of the story of rising inequality.

My position on Stock Options and Inequality remains that they have a massive impact, through the creation of Financial Paper. Sale of this Financial Paper absorbs Capital funding without capital construction, leads to irrelevant Profits-Taking by the Brokerage, pressures Corporate management to prop up its Stock prices by cannabalistic Profit-taking, and suppresses long-term Capitalization projects due to the long periods before Returns.

This Post still does not destroy Jane Galt's exultation of wealth as some sort of beauty in itself.
One needs a more profound definition of Rich beyond monies, extending into Control functions of resources. This argument lacks weight as long as Prices of luxury Goods inflate faster than normal Goods. Envy, whether rationalized or not, still walks and talks like Envy. Maybe it is only because I would like to be a Conspicuous Spender myself; can Anyone loan me a little Cash? Oops, I have forgotten the Baker argument already. lgl