How intelligent is a million dollars?
A million dollars in the hands of 1000 people with $1000 each will have many carefully considered impacts on a wide range of companies and ventures.
A million dollars in the hands of a single person is much less intelligent.
It's just not going to be spent as carefully. The primary concern is more likely to be simply be earning interest rather than comparing products.
The theory that people who are rich are smarter than everyone else doesn't quite make up this gap. And I think it's reasonable to question that theory.
But even assuming it were true money seeking a place to be invested just isn't doing the same work to shape the economy as money spent on products. In a way, this money is along for the ride, depending on those consumer choices to highlight the best places to park. Freeloading.
And I think the disfunction we see is the result of that freeloading. There just isn't enough raw cognitive power behind the money anymore.
@futurebird I think it goes further than that. It's not just "freeloading"--people who are looking to make money with money operate in ways that are destructive to the economy. This includes the formation of monopolies and monopsonies and the destruction of competition required for that, sure, but also things like leveraged buyouts.
It is often more profitable to destroy things than it is to make things, right up until it suddenly isn't, the market crashes, and the financial vultures make the "real economy" pay for their avarice.
This is such an interesting approach, thank you for posting. The more split up resources are, the more potential for intelligent deployment of those resources?
There are many fields where possibly similar things going on?
We would get more interesting films if a single major motion picture's budget was distributed to microbudget projects. Huge-budget movies tend to be so risk-averse that they are usually very bland and derivative.
Totally different (and grimmer) example: In the Ukraine War and Iran War, large numbers of cheap drones are causing headaches for small numbers of hugely expensive missiles and aircraft.
People who say they love capitalism don't talk much about just how much their theory depends on collective intelligence. Just how badly it falls apart if you don't have all of those perfect economic agents making millions of rational decisions, doing the *work* of deciding what is a better value.
Other aspects of capitalism give large players the power to bigfoot these decisions to bend the market to their whims: and those whims aren't rational anymore. It all falls apart.
@FediThing @futurebird As a general rule, small decentralized diverse ecosystems are more successful and resilient than large centralized monocultures. This shows up everywhere, as you’ve noticed.
In the world of finance, a key strategy for investment is putting money in multiple ETFs, each of which splits the investment across hundreds of small companies. When the 2008 financial crisis happened, my 401(k) wasn’t hit too badly, ironically partly because I had a lot invested in supposedly risky overseas funds. (American exceptionalism strikes again.) I’ve gone through and worked out how much I have invested in companies that might tank when the AI bubble bursts, and it’s about 5–6% of the total, which is pretty good given how AI is being rammed in everywhere.
In computer security, a network of diverse nodes can be harder to secure, but it means that a single security issue is less likely to take down the entire network. But IT people are told the opposite — that if every host is standardized it’ll be more secure. In the short term that may be true, but see the CrowdStrike disaster for how it can work out in the long term.
@futurebird The fashionable phrase these days is "rent seeking."
Investing in the manufactures of rent-seeking missiles.
@futurebird Pretty much, because that level of investment destroys the capitalized product.
Sep 9, 2026, 1:28 PM@futurebird There also assumptions by free market theorists that people will act a certain way. That people will be protective of their reputation and think of the long term. They never considered that someone would burn down their company if it made them money, even though it lost the company money.
In Cunningham's The Age of Selfishness Alan Greenspan admits that he didn't forsee the real estate crash because he thought people would value their reputations.
Sep 9, 2026, 11:55 AMOne of the things a million dollars buys is the luxury of not having to be intelligent with it.
Making all those decisions about everything all the time is exhausting.
This is very true. I think it is a kind of unrecognized labor we take for granted at our peril.
When a civilization starts making self-defeating unambiguously bad decisions it is often because a small number of people could make massive gains through some short-sighted play. And the number of people required to hold them back is simply too vast for each of them to care enough to do their small part to stop it.
Sep 9, 2026, 12:12 PM@futurebird Another to thing that will happen is that the millionaire will simply park most of the money in a bank account, sitting still.
A thousand hands (and minds) will make the velocity of money greater, enhancing economic outcomes in the greater economy.
@futurebird financialization: housing in the hands of people whose primary interest is not in housing people…wealth in the hands of folks who are not interested in the common wealth.
Sep 9, 2026, 3:26 PM@futurebird classic example: the covid stimulus package had HUGE benefits to the economy