Comments on: For Discount Rates

By: Aurini

Aurini — Fri, 12 Mar 2010 17:39:57 +0000

I was wondering about this a year ago – would it be possible to invest money, while giving half the interest to tax payers, the eventual goal being an elimination of taxes?

This type of stuff – investments and whatnot – has always made my mind boggle though.

By: Richard Hollerith

Richard Hollerith — Fri, 26 Dec 2008 01:40:00 +0000

Just a note to let ShardPhoenix know that this reader read his comment even though the post is old.

By: Eliezer Yudkowsky

Eliezer Yudkowsky — Thu, 25 Dec 2008 23:10:00 +0000

ShardPhoenix, I wonder if your statement "Either way, you won't have access to anything like 10^100 times what a dollar will buy you today, which suggests that 2% real gains over 12000 years are impossible" will end up next to a list of Lord Kelvin quotes in some future history of misplaced skepticism...

Boy, there's a universe I'd like to live in.

By: NE1

NE1 — Thu, 25 Dec 2008 22:28:00 +0000

Any tycoon has need for at most 100 yachts. But every beggar would treasure just one.

By: ShardPhoenix

ShardPhoenix — Thu, 25 Dec 2008 13:06:00 +0000

But regardless, it's not possible for anyone to meaningfully have $10^100 (or even $10^50) as measured in today's money and by today's standards of what having wealth actually means. There aren't enough resources in the accessible universe. For example, $10^50 would be enough, at today's prices, to buy a sphere of gold about 10^14 light years wide, if I calculate correctly. That amount of resources doesn't exist, so any attempt to actually spend this kind of money on material goods is just going to cause massive inflation and effectively destroy the supposed gains.

You can define this inflation out of existence by picking the right "basket" of goods to measure it with (eg only considering intellectual property, which is presumably much less limited), but you'd have to completely ignore the cost/availability of physical materials, which seems like a case of moving the goalposts.

Either way, you won't have access to anything like 10^100 times what a dollar will buy you today, which suggests that 2% real gains over 12000 years are impossible.

By: Robin Hanson

Robin Hanson — Thu, 25 Dec 2008 11:21:00 +0000

Shard, I think it is fine to comment on old posts. Interest rates need not equal growth rates, and some people then could have comparable wealth to today without the average wealth being at that level.

By: ShardPhoenix

ShardPhoenix — Thu, 25 Dec 2008 10:49:00 +0000

Oops, didn’t notice that this post was so old.

By: ShardPhoenix

ShardPhoenix — Thu, 25 Dec 2008 10:40:00 +0000

"The scenario where future folk exist, have comparable per-capita wealth, and usually pay their debts is far from "arbitrary"; I consider it the default reference scenario."

If by "comparable" you mean "comparable to the present", then I'd say that the scenario where future people have wealth comparable to the present, and yet an investment has been able to grow to $10^50, is not only not "default", it's obviously impossible.

In fact, I'd say it's pretty clear that maintaining a 2% real growth rate (by modern measures of wealth) over 12000 years is also impossible, which undermines the basis of your argument.

I don't actually disagree with that idea that we don't care as much about future people as ourselves, however - that seems pretty clear to me too.

By: Rolf Nelson

Rolf Nelson — Sun, 27 Jan 2008 00:41:00 +0000

Do you have a description of all the factors to weigh that isn't over-simplified?

Peter, since my response is off-topic, I'll respond on the SL4 list.

By: Robin Hanson

Robin Hanson — Sat, 26 Jan 2008 17:34:00 +0000

Welcome back Hal, however temporarily; we’ve missed you! Yes, one of the points I was trying to make clear is that after adjusting any plan to achieve gains from trade, it will look as if it had been chosen by discounting according to market rates of return, the plan might have changed such rates of return. I am somewhat mystified that not all economists agree with me on this.