Capital formation

BILL BONNER
Economists call it “capital formation.”

It refers to the thing that separates free, rich societies from poor, slave economies.

“Net real investment” is the amount of savings put to use training people, building new plants, and buying new “capital” equipment. That is, it’s the part of what we earn that is not consumed… but used to create more wealth.

It’s why wages are higher in the U.S. than in Mexico, for example; because America has more accumulated “capital.”

Free people, once they get the taste for it, build capital. They save their money. They start new businesses. They create goods and services that add to the wealth of the whole group.

Unfree people don’t. They are not allowed to. Or sometimes, they fear their new wealth might be taken away from them, so why bother?

Or they are faked out by fake money, false interest rates, regulations, subsidies, bailouts, stimmy checks… and other abominations.

BITCOIN
One of their popular visuals is which market these managers feel is the most crowded trade. This month, it was being long bitcoin.

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Göran Högberg