“Everyone will just X” when X individually makes obvious sense for most people.

For some, it’s a matter of cost. The cheaper option tends to get a lot of adopters. Making the better option cost less is sometimes a matter of engineering and innovation improving the cost of the better option. Or sometimes it’s making the worse option cost more, sometimes directly through taxation or indirectly through regulations. Electric cars are pretty much on a self sustaining path at this point, where the economics of electric cars can be a much better financial decision for themselves personally, compared to similar ICE vehicles.

For others, it’s a matter of cultural influence, where trends in adoption just make things different. Tobacco use, especially actual smoking, is way down. Drinking alcohol is down, too. In my lifetime, helmet use for bicyclists and skiers is way up. These broad societal preferential shifts can happen without necessarily having big mandates from government.

And even if nudged somewhere by temporary government policy or price, sometimes people stick with that option long term if that’s what they learn to prefer. Seat belts kinda went this way, where seat belt usage rates went way up between 1980 and 2010, so that even after federal regulations were struck down by the courts and state level enforcement dwindled in the past decade, everyone still wears seat belts (including when visiting places where they’re not required).

And of course, the big influential force for changing behavior is government policy. As a society, we’ve pretty seamlessly moved off of things that were banned (leaded fuel, CFCs), even if the transition took a few decades (lead pipes, lead paint), or quickly adopted things that were mandatory (child car seats, bike helmets).

Emissions from food production is one of those things that can shift a bit from all of these factors. We’ve shifted away from beef towards chicken in the last few decades, and that alone has made a difference in greenhouse emissions. We might see more shifting down that line, just culturally. Or we might see some economic nudges from the fact that beef and dairy production are so costly for reasons correlated to their environmental impact.

But ultimately, meat doesn’t contribute nearly as much as driving does, for the typical American household. The real impact comes from how we design our cities, not on how we eat.

The Federal Reserve is the entity that can creates dollars out of thin air, bevause they control the interest rate of the dollar.

They control the base currency by physically printing dollars and lending money directly to banks. Then, more significantly, they influence the money supply by influencing how much commercial banks are lending, through interest rate operations, and sometimes through market operations that provide liquidity for certain types of securities (especially government bonds).

Taken together, it’s the power to create or destroy money in response to macroeconomic trends.

The Federal Reserve system is independant of the US federal government.

Kinda. The board of governors is chosen by the president to 14-year terms, theoretically making them independent of any specific President’s specific priorities. But there’s a Supreme Court case heading when the President can fire the governors, which might effectively end or limit Fed independence.

The individual federal reserve banks also operate in their regions with a lot of leeway to meet local needs, and those are public/private partnerships where nationally chartered banks also have a voice in their operations.

My “We’re totally different from Enron” accounting report has a lot of investors asking questions answered by the report.

In my mind the concept was one of regulatory oversight.

No, the core concept is one of whether a bank has full reserves, sufficient to cover all of the deposit liability. If the bank keeps only a fraction of the total liability in reserves, then that’s a fractional reserve.

Do you think that when a bank loans money to another bank they are creating money out of thin air?

Yes, that creates money.

If they can do that then why do they need to borrow money?

They need to borrow money for liquidity, to cover the payments they owe to others. An IOU isn’t money, so having a bunch of IOUs in the asset column may require a bank to pledge those IOUs to borrow some money from someone else, maybe even another bank. Then, with money in hand, they can make payments to fund their own operations (pay employees, rent, vendors, taxes, etc.) and pay depositors on demand.

And as a financial institution borrows too much and pays that interest, or is overextended without enough assets to remain solvent/liquid to be able to make payments as they’re due, they may find themselves with insufficient creditworthiness to be able to borrow freely (as other banks are wary of lending to someone who might not pay back). And they might fail. So that general concern always provides a limit on how much they can borrow from other private entities.

They can borrow from the central bank as a lender of last resort, but that carries a cost (and can still only borrow as much as their assets can support). If they’re paying more interest to their creditors than they’re collecting from their borrowers, they’re gonna fail.

Do you believe that the US government must collect taxes before it can spend money? Or do you agree that government spending is self financed and money creation (in spending by the US government) is only limited by concerns of inflation?

No, the government can (and does) borrow money to finance its operations, as well. For the U.S., the sheer amount of government spending is such a high percentage of economic activity that it would be highly inflationary to combine the fiscal power of spending money with the monetary power of controlling the money supply (through creation of base currency, influencing private transactions and interest rates to control bank-created money, and buying/selling securities on the open market).

I think if we lived in a different system without an independent central bank, we’d see a lot of different things going on, including a temptation to elected officials to just create money without regard to inflationary effects. But in the current system, most of the money is created by banks.

Do you believe that Banks hold digital money in their reserves? I do.

Yes, that’s what we’ve been talking about the whole time. When a commercial bank creates a loan, that’s just a ledger that creates an asset in one column and a liability in another column. It could be paper, or it could be digitally stored. If the funds are transferred electronically to another bank, that’s often an electronic record with no physical movement of anything. So yes, those are effectively digital dollars that can be withdrawn as paper money on demand at any given time.

it’s true that banks can create money when they lend more than they have in reserves and assets

To be clear, the article is saying (and I’m saying) that the bank creates money every time it makes a loan, in the amount of the loan. Regardless of whatever its reserve and asset situation is. An asset and a liability are created in that moment that cancel out, and then each side can take their asset and do something with it: the borrower uses that cash to spend, and the lender uses that loan balance as an asset it can borrow against or otherwise count on income from.

IMO bank loans are credit but the bank loans are repaid with actual money.

It’s repaid with actual money, but it’s all actual money. When the loan is created the balance in the deposit account can be withdrawn or transferred from there and it’s real money that can buy real goods and real services. The money is created, and then it’s real money in the economy. Then the loan is repaid with real money, and then destroyed in the act of repayment and reducing the balance owed on the loan.

Also, you mentioned fractional reserve banking but that no longer exists. It ended around 2020 when the government changed regulations and no longer requires banks to hold any ratio of reserves to debt.

No, that had the opposite effect of what you think. The minimum reserve requirement was abolished, so banks could then do fractional reserve banking in any fraction they pleased, including even smaller ratios than what was previously allowed. The change in regulation didn’t eliminate fractional reserve banking; it eliminated limits on fractional reserve banking, and every bank continued to hold a reserve that is much, much smaller than 100% of the amount of their deposit liabilities. So the fractions still exist. And can continue to exist in any number, with other practical limits on their ability to loan (creditworthiness and solvency).

VTWAX is still like 65% US equities. It hasn’t diversified out of U.S. exposure (and frankly, international stocks aren’t protected from U.S. economic crises). A lot of people think about full blown collapse and crisis, but wouldn’t know what to do about lethargy and stagnation for decades, but still roughly the same economic and financial paradigm.

I think U.S. equities are overpriced right now, especially when looking at market cap weighted indexes (because the U.S. tech bubble seems to represent a much higher percentage of any given index). And I’m concerned that the correction will just be decades of tepid growth or even stagnation where decades of investment won’t actually earn a good return. Not that I’m investing in something else, other than maybe the soft skills I’ve described in my earlier comment.

Your own link from the Bank of England starts off with the thesis that agrees with me:

This article explains how the majority of money in the modern economy is created by commercial banks making loans

And you might as well link to the canonical URL of the PDF or the Bank of England website landing page for that article instead of Google Drive acting as a middleman.

The money in the bank’s reserves started its life by being created by the federal government.

No, you’re misunderstanding how the money supply works. The creation of physical printed money might happen by the government, but those physical dollars represent such a small portion of the overall money supply.

First of all, through fractional reserve banking, one physical dollar can get multiplied many times over to represent many dollars in circulation. Especially because most transactions happen on paper, through a ledger that transfers funds from one account to another.

Everything you’re saying still relates to the practical limits of money creation by commercial banks, in terms of creditworthiness (banks don’t want to lend money they can’t get back) and liquidity/regulation (banks don’t want to be left vulnerable without sufficient reserves to satisfy account holders demanding their deposits).

Realistically, the bank takes one of their own assets, such as the balance on the loan, and uses that as collateral to borrow liquid cash as needed for its own reserves (which are only a fraction of the total deposits in its accounts). And every dollar in a circle in a closed loop that doesn’t touch the Fed is a dollar that doesn’t actually trace back to a governmental entity. The Fed is a lender of last resort, but they’re a last resort because they generally charge higher interest than bank to bank loans.

So of the entire money supply, the vast majority of it is dollars created by banks, not dollars created by the government.

To me, exploitation by association is still exploitation.

But by this telling, the billionaire isn’t any less moral than the person who buys the tickets. If simply transacting with this system is unethical, then the billionaires aren’t any worse than the millionaires, or even the people barely subsisting on what they have.

In my eyes, there’s a huge difference between the person who actively exploits others, and one who incidentally interacts with a person who exploits others. Especially if choosing to opt out wouldn’t actually reduce the exploitation happening. There are still degrees to things, so it’s entirely possible for the billionaire artist to be ethically superior to the millionaire venue operator, even when they both rely on the other.

Not to mention, there’s a difference in kind when talking about exploitation in terms of a team effort where not enough of the fruits of the labor get shared fairly with all team members (positive sum interactions) versus when one actively takes from another, and that victim is worse off from the transaction.

These changes disproportionately affect rural areas.The Postal Service is reducing trips between mailboxes and post offices more than 50 miles from a regional hub. So that means rural areas and even urban areas that are far from a regional hub will see disproportionate reduction in mail delivery performance, and will be more likely to see a delay in postmarking.

Read through this:

https://www.federalregister.gov/documents/2025/08/12/2025-15266/postmarks-and-postal-possession

Postmarks don’t end up on all mail, because certain types of mail do not require cancellation of a stamp.

When there is a postmark, that is proof that the postal service was in possession of that piece of mail on that day. It does not prove that date was the earliest that the item came into the possession of the Postal Service, and does not foreclose the possibility that the Postal Service was in possession on an earlier date.

For the big operational change being implemented, where zip codes more than 50 miles from a sorting facility get fewer trips and might not be sorted on the same day that the mailbox contents are retrieved, there will be a one-day delay on most days, a two-day delay on Saturdays or the day before a holiday (because they won’t postmark on Sundays or holidays), or a three-day delay on Saturdays before a Monday holiday (because the Sunday plus holiday represents two consecutive days they don’t sort mail).

One easy thing to implement, for anyone whose procedures depend on the postmark, is to just move the latest allowable postmark to be the next business day after the deadline, between 1-3 days. Another could be to inform customers that if they live in one of the affected zip codes, they need to affirmatively ask for a same-day postmark at the retail location where they’re dropping off the mail. That might require some additional driving to the actual post office instead of an unattended drop box, but in most places the latest pickup in a blue box is actually earlier than the time the nearest post office closes anyway.

And I will say that I’ve gamed the system before, where I bought a barcode based stamp just before midnight from an automated postal machine, because those aren’t postmarked at all, and most recipients incorrectly consider the purchase date on the stamp to be equivalent of the postmark date, so that I had a few extra hours to finalize an application past midnight that night.

Just like with Social Security numbers, where Social Security Administration had to tell everyone “wait this number wasn’t intended to be used in that way by others,” this seems to be the USPS pushing back against certain assumptions on postmark dates.

I had a whole comment that got eaten up in an error (and a Lemmy client that doesn’t fail gracefully, I really should be moving off of Sync). But maybe that’ll be an opportunity to give a more concise summary of what’s going on.

https://www.federalregister.gov/documents/2025/08/12/2025-15266/postmarks-and-postal-possession

This USPS notice is basically correct. The meaning of postmarks isn’t changing: it’s a mark that definitely proves that mail was in the Postal Service’s possession on that date. The absence of a mark doesn’t mean the absence of possession, and the date of a mark does not foreclose the possibility that the mail was in the Postal Service’s possession on an earlier date.

It does note there are operational changes where they’re now taking fewer trips in certain low volume zip codes, and that expands the number of places where postmarks are being applied on the next USPS operational day: usually the next day, but a second day if the next day is Sunday or a holiday, or a third day when the next day is a Sunday and the day after that is a Monday holiday.

Someone mailing something may still request a same-day postmark from the postal facility they’re dropping it off at, but that’s not helpful if they’re already past business hours or using an unattended outgoing mail box.

Most importantly, though, it only has a small potential to affect voting.

• Most states require ballots to be received by election day, and postmark day doesn’t matter.
• Even in states that look to postmarks, they still have a deadline to be received by a particular grace period, so you’ll want to get the mail sent as early as possible anyway.
• The Supreme Court just heard a case, and will rule by June, on whether states are even allowed to follow the postmark date instead of the received by date.
• Election Day is on a Tuesday not near a holiday. So the operational changes will only add a single day to the postmark date, in the low population areas that don’t deal with a lot of mail, for people who don’t request a same day postmark from the post office.

Money begins its life by being spent by the federal government.

No, in the modern system, money is created by commercial banks when they give a loan.

At the moment a loan for $1 million is created, a bank takes $0 and then turns it into two accounts: a loan with a balance of negative $1 million owed, and a deposit account with a balance of $1 million that can be withdrawn. From the bank’s perspective, and the borrower’s perspective, they went from having $0 to suddenly each having $1 million in assets and $1 million in liabilities, for a net value of zero. Obviously there are going to be fees and stuff paid out, and interest charged over the life of the loan, but you can think of that as fees for services rendered.

The money in that deposit account, created out of thin air, can then be spent elsewhere and enter the economy.

The limits on the ability of banks to do that indefinitely is default risk (the bank is left holding the bag if the borrower doesn’t repay) and liquidity (the bank needs to be able to use the loan balances as an asset on its balance sheets to go and borrow cash for its own operations so that its accountholders always have the ability to withdraw money on demand) and government regulation (the Federal Reserve and the FDIC have various regulations requiring their balance sheets to be able to survive stress tests and other adverse economic events).

So even though the government, through Federal Reserve policy, controls how private market participants might choose to create money, the actual act of money creation happens in the banks, not in the government (except when the government is acting as a bank by lending money through its loan programs).

but 3.25-3.5% is basically impossible to go broke with,

Historically it has not been enough to draw down funds that are invested in a broad American stock market index like the S&P500. But that doesn’t make it impossible. A 20-30 year run that looks like the Nikkei 225 between 1990 and 2020 could wipe out portfolios on a 3% withdrawal rate. Even a 2% withdrawal rate would’ve run out of money in 32 years.

I’m kinda bearish about the continued dominance of the “invest in publicly traded large cap American equities” strategy over the coming decades, so I’m a bit more conservative in my savings rate, and what securities/assets I’m actually invested in, including soft assets like my own earning ability if I were to bail on this country and move somewhere else (fluency in another language, job skill sets that translate outside of the US borders, relationships/network with people who don’t rely on the US).

And I know that’s not the central point you’re making. But there are plenty of people who might not feel secure with $1.5 million or even $3 million or $6 million in investible wealth, especially if it’s tied up in one particular asset or asset class, or otherwise less liquid than publicly traded securities.

I’ve also heard salaries over $£€70,000 no longer increase happiness.

No, that study was debunked. Turns out that some subset of unhappy people will remain unhappy even if you give them all the money in the world, so looking purely at the least happy people in America, you’ll notice that their happiness stops going up at $75,000 in 2010 dollars. But if you focus on people who are already on the happier side of the spectrum, more money keeps buying them more happiness, even if the slope of that relationship tapers a bit.

Side note, the way the two sides reconciled their methodologies, that produced different results, was a really interesting way to perform science, and should be followed in the future whenever there are well respected studies that contradict each other.

It’s impossible to become a billionaire after that without exploiting others, whether that is workers, employees, investors…whoever.

People say this, but I don’t think it’s true.

If I simply ask for people to give me money if they like me, and I get 1 million people to give me a dollar each, then I become a millionaire. Nobody’s being taken advantage of, everyone is voluntarily doing this.

Getting to a billion is a lot harder but not impossible. If I ask and 10 million people give me $100 each over the course of 10 years, I might make a billion dollars that way.

So who can do this kind of “ask people for money” at these scales? Anyone who provides a service where the marginal cost of each additional recipient of that service doesn’t cost anything. A musician playing music in a subway station performs basically the same amount of work whether 10 people walk by or 1000 people walk by in the time that he performs. And if you’re a recording artist, you might release a song that literally over a billion people enjoy.

Yes, sports leagues and movie studios and record labels and Ticketmaster and book publishers and live venues and broadcasters and tech platforms are often exploitative in many ways, but authors, musicians, artists, filmmakers, comedians, and other creators can and do sometimes do things that make the world better by billions of dollars worth of happiness, while taking a cut worth hundreds of millions, or even billions.

Ultimately, we do things that produce value in some way or another. Sometimes we get to keep the fruits of our labor, and sometimes we get to profit from that value created. Often, as in the world of intellectual property, the value is very far removed from the actual cost to produce, including the cost in terms of human labor. When that happens, sometimes the excess value is worth billions. Even without a big team creating that value.

Or maybe use excess power to electrolyze water for fuel cell use later?

Hydrogen storage presents a lot of challenges, because it tends to leak at normal temperatures found on Earth. So we either tolerate a lot of loss during storage, or we use lots of energy chilling it to a temperature where it won’t easily escape.

There are about 500 NBA roster spots. Total basketball related income across the league is $10.25 billion, and the CBA requires that player income make up half of that. So there’s $5.13 billion to split between 500 players, an average/mean of $10.25 million per full time player (some players get called up or put on reserve when injuries or something like that happen).

There are about 3.8 million public school teachers in K-12. If you took literally every dollar paid to NBA players and gave it to public school teachers, that’d be about $1350 per teacher.

There are other sports, of course, but we’re also talking about nurses and doctors and EMTs and public librarians and other important underpaid jobs. Taking all money from sports isn’t going to make much of a dent in those other jobs’ pay.

Ridiculous pay for star athletes and celebrities is at least fair

Put another way, we as a society actually do spend wayyy more money on doctors, nurses, and teachers. It’s just that there are many millions of people who have to split that pot of money, whereas for pro athletes there are only a few dozen or a few hundred to split that comparably smaller pot of money with.

I might have the same favorite NBA player as literally millions of people in this country. I for sure don’t have the same favorite doctor or favorite teacher, though.

So if a genie showed up and said “give $1 to your favorite celebrity and give $100 to your favorite teacher,” we as a society would give way more money to the teachers, but each individual teacher would receive less than each individual celebrity who gets paid under this system.

there is a exact method to get the right answer and you can easily check/prove why you’re right.

There might be many methods to get the right answer, and you might not know which ones are easy and which are really difficult (and which are tricky enough to make mistakes more likely) until you try a few different approaches and maybe hit a few dead ends.

What is the sum of every integer from 1 to 99? Well, you can manually apply the arithmetic, adding two numbers at a time, but that’s going to take forever. Better to use a particular method of summing arithmetic sequences and get an easy answer in fewer steps.

Or take this deceptively simple looking problem of trying to integrate x to the x power, where the question asker is messing up their initial approach and the answers show several different concepts that are useful for solving.

With actually difficult problems, the difference between a good approach and a bad one can be the difference between the problem being actually solvable versus not solvable using the resources to have at your disposal (computing power, actual time, etc.).