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"trickle down theory" seems obviously correct to me. Like, if a person has lots of money, it's stupid to sit on it - they invest it, found businesses, hire people, buy things - all of which are putting money back into lower tiers of the economy to me. Am I missing something big?

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You're missing that they are literally sitting on it about 80% of the time. Deep dive into the Panama Papers.

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But that just seems retarded to me. Sitting on money is so dumb I have trouble believing rich people with access to the best financial advisors would do that. Unless the tax burden is discouraging them from reinvesting into the economy?

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"Sitting" on money doesn't mean getting no return. High Frequency Trading adds no real liquidity to the market, doesn't substantively invest in companies operations, and makes shit tons of money. It's almost a lucrative private tax orchestrated against real investors.

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Ok this seems like a real answer, or at least I don't know enough about this. Do you have a link you recommend to learn more?

12:07 AM · Dec 28, 2019

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There are a bunch of books about what happened at Enron that are a pretty good reference about making money by "appearing" to have a business and just moving things around. Enron only collapsed because they overreached, and crossed some stupid lines.

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Ok yeah but Enron seems like a different thing? Like the issues there don't seem inherent to having a lot of wealth

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Most wealth is not in HFT firms. This is nonsense. Most of Gates's money is in Microsoft. Most of Buffet's money is in Berkshire Hathaway. Most of Carlos Slim's money is in his Telecom. Most of Bezos's money is in Amazon.

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Will is right about HFT, but it's a very small component of the financial markets relying on algorithms that crunch miniscule margins out of tiny market inefficiencies — too small to be taken advantantage of except at massive scale. It's zero-sum; too slow, you die.

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The shenanigans involved in rearranging money for profit are fascinating and varied. The Panama Papers stuff covers some. Some HFT stuff just isn't public. I once worked at Lehman Bro's Mortgage Capital Division, so I have a slightly skewed perspective.

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I basically went here and tracked a few people and corporations through the file dumps. There are probably better resources and stories out by now though.

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Flash Boys is a good and accessible book on HFT.

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Remember property too, that is the only real wealth. How does anything trickle anywhere when a person owns 20 houses and doesn't rent them out? If they do collect rent then they are just leeching. Wealth trickles up! Not down, think of the value, it comes from workers paying rent