Yes or no, the only real capital is earnings and the only real growth is through reinvestment of earnings?

Question

If you disagree please explain how / why.

Yes there is debt and there is contributed capital but debt is expected to be repaid - with .... earnings. And contributed capital is, while risk capital, invested with the objective of a return - achieved through earnings. And the contributed capital and debt itself is simply the earnings of a third party or firm being invested.

This is not to be confused with MONEY. MONEY is not capital. Money is currency - it is meant to represent capital being spent / invested. Its worth, in the long run, is entirely a function of the government's willingness and ability to pay the note - - ability meaning ultimately no matter how many notes you print they're worth in total no more than the capital you've generated - in other words, earnings.

Please note, every economic policy success and failure can be traced to a failure to answer this question correctly.

Money is not capital. It is a unit of measurement of capital.

Laissez faire, suppose you and I start rival bakeries, right across the street from each other. You and your laborers toil all night making cherry pies. But I did a bit of market research and discovered that in our neighborhood, blueberry pies are preferred. So I came in at 8 AM, made some blueberry pies, and opened at 9.

I sold all my pies, you sold none of yours.

I have earnings and thus capital.

You have neither.

You are correct that it is the application of resources that creates earnings but it is a particular application - to the demand of the consumers - and the amount of earnings the application of those resources has created is judged entirely by those consumers.

Look at the balance sheet of any firm - there is retained earnings, there is debt and there is contributed capital, and the latter two were injected with the expectation of receiving, and are worth anything only because of that expectation of receiving, a portion of the firm's EARNINGS.

Now let's get on to the main point.

Earnings are the only real capital and the only real growth is through reinvestment of earnings.

So, is it not crazy that we fund our government with taxes that are determined as a percentage of earnings? It puts government at direct odds with the private economy - in addition to putting the tax rate at odds with the tax base itself.

Answer 1

No Nodwell!

Wealth or money comes from items produced; we don't produce anything in America anymore because of the Nazi/Zionists traitors for NWO!

The USA is "No. 1" in nothing but weaponry, consumer spending, debt, and delusion.
http://www.citypages.com/databank/26/1264/article12985.asp

The Hastening American Decline: Transfer of the American Industrial Base
http://www.gooff.com/news/read.asp?ID=1428

Transfer of Industrial Base backfires on US
http://www.rense.com/general39/trade.htm

Answer 2

You won’t have any earnings if no one has the money to buy your product. Putting money into the hands of spenders such as the workers and the government enables those entities to buy products and services. The economy does not operate in a vacuum.

Answer 3

I agree with part 1, but disagree with part 2.

Resources + Labor = Growth. It doesn't take re-investment of earnings, although that helps.

Answer 4

If money is not capital then what are you earning? Come of the the circle jerk.