Too Much Money

The negative interest rate is clear indicator that the world has an excess of capital. And an excess of capital that is so beyond existing aggregate demand that the only solution is for capital to die via negative interest rate.

It’s interesting that we finally reach a situation where the world needs less money to meet humanity’s needs.

There are 6 pressures that will define our world in the next 50 years:
– man’s envy. It’s unrealistic for everyone to have the lifestyle of the 0.01%, but everybody wants it.
– nature’s capacity to provide the lifestyle man desire. Nature would be strained if all 6 billion people want to consume 1000kg of magnesium in their cars, ostrich leather in their bags, and 40,000 gallons of water for their swimming pool. Money is a poor method to limit consumption because mother nature cannot speak and negotiate the base price of extracting resource from nature.
– automation, AI, and robotics capacity to replace more and more cognitive jobs. We might end with a world where the only job that require a human being is… nothing
– capital’s need to multiply. All capital owner seeks to grow their capital. They will employe people to find new markets or create new markets by converting “desires” into “needs”. Capital will pour into any growth geography or segments or industries that’s deemed safe. In the past, when capital cannot find new avenues of growth (mostly due to technology limitations), war happens. Then war not only destroys existing assets, allowing capital room to grow, but also resulted in technologies (e.g. Aircraft, radio telecommunication) that allow capital to enter new markets
– man pettiness, that misguided sense of fairness that is at the root of rejection to social programs to extend the benefits of civilization to the poor. That very US Republican Conservative attitude of social darwinism, “the poor is poor because they are lazy, stupid, etc; thus, let them suffer”, the attitude that allows public schools in affluent neighborhood to be much better resource than public school in non-affluent neighborhood.
– anarchist. mad mens who find themselves irrelevant in the current world order and seek to create and propagate their own imaginary society. ISIS is an example of this. The fact that many ISIS members comes from the west show that the problem is psychological, not geographical.

So we have men who seeks to have what other have and capital that is very happy to serve that appetite, and the reality of nature’s limitation and that fewer man is actually needed to do a job, and the ambivalence of providing money (power) to those who doesn’t work. And a fringe elements who just want to see the world burn.

So we could end up with a world where:
a. Capital is further concentrated to the 0.0000001%, and 99% of people who are basically jobless and either live on welfare or on poverty. Elysium
b. Man no longer need to work and focus on expanding their knowledge and are “paid” to learn and contributes new knowledge. Startrek.