Friday, November 3, 2017

Creating Wealth

Creating wealth is entirely different from just transferring it.  The service sector lives off transferred wealth. They are in essence, moving money from one pocket to another.  So, how does a country or economy actually create wealth?  Basically, there are three ways to do it:

1.       Manufacture it

2.       Mine it

3.       Grow it
I used to tell my sons when they were younger that the wealth was only created when it came from the ground.  Even in manufacturing, the wood, steel, plastic, etc. had to come from beneath the earth’s surface.
China is able to finance the United States’ debt because they have become the manufacturer to the world.  One reason the U.S. isn’t totally defunct is because we still remain an agricultural power house (number 3), for now, but that is for a future post.

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