It's funny how often you hear "put your money to work". Money doesn't work, people do! If you receive a monthly income by doing nothing, you're taking from someone else's work.
While technically true, this could still be a great trade for all involved.
If you invest in shares in a company, you are a link in the chain to that company existing at all, employing people, serving customers, and paying a dividend to shareholders. Employees have a job and income without the need to come up with the initial capital to start the venture and the associated risk of no income for a while.
If you invest in real estate, you are providing the capital that allows someone to have shelter (and maybe allowing a property management firm to also employ people). Tenants have shelter without the need to buy an entire lifetime of a house that they only want to live in for a few years and without the hassles of being tied down to a specific address (in the event their relationship status or family size evolves or a job improvement arrives 50 or 200 miles away) or buying and selling houses frequently as these changes tend to happen frequently early in adult life.
Neither is something that you had to wipe sweat off your brow this particular month, but it is a deployment of foregone consumption in the past that allowed you to make those investments. Now that previously foregone consumption is being returned to you.
Another tangible example is renting a tractor to a farmer that couldn’t otherwise afford one. Their income from crop production goes up (even after tractor rental expenses) and society also gets more food.
But wouldn't it be even better if the farmer bought the tractor on a loan? Now the farmer keeps the entirety of his production and the guy that would have rented the tractor also has to work, further improving society.
The farmer is either renting the tractor or renting the money to buy the tractor. Which is better depends on details like the rate of the loan/rental and the expected utilization of the tractor.
How is that different. In either case the farmer is paying someone (interest/rent) more for the use of the tractor than just outright buying it (which he does not have the capital to do).
That's the decision to be made by the farmer either selling equity or taking a loan.
From the perspective of the banker/lender, they're still living off someone else's labor (which is fine for me since it's the result of a voluntary exchange for something else of value, but it seems like it's not for some upthread posters).
- Investing provides benefits for society at large
- Investors are exploiting the labour of others for their own gain
(but also your examples only work in a very weird worldview where everything is privatised, but I don't want to bother discussing that on this website)
Not really true at all. Production is almost always a combination of labor and capital. Consider a restaurant. People are working there but so is a stove, aka capital aka money.
I think you misunderstood what capital is. See, one does not become a Capitalist without taking advantage of others. Most people don't have the initial capital to build the stove and sell it to other Capitalists, so they end up, as in your example, just another piece of equipment doing the actual work in the restaurant alongside the stove. The Capitalist and their money do no actual work, but finance the work being done then profit from it with stolen wages and artificial inflation, which is why your steak costs you, the customer, $15 USD to enjoy when the reality is it took a collective $5 to actually produce.
So the original reply is correct; money does not work, people do.
> While money itself may be construed as capital, capital is more often associated with cash that is being put to work for productive or investment purposes. In general, capital is a critical component of running a business from day to day and financing its future growth.
What you're espousing is the outdated view of the Labour Theory of Value. To see why this is wrong, imagine a bottle of grape juice that gets forgotten, which turns into wine and gains value. Yet no work was put into it.
Please, please stop repeating century-old outdated theories that has been disproven.
No one is giving up anything voluntarily. Do you think workers in the global South are willingly working for meager wages (i.e. giving away most of the wealth they generate) or do you think they are somehow constrained into it?
When market crashes (march 2020) they created trillions in debt. Who works for that amount? They literally gave away some small part of it. Try to learn how debt based MMT works.
