Was just trying to explain to someone why everything is going to shit, specifically companies, and realized, I don’t fully get it either.

I’ve got the following explanation. The sentences marked with “???” are were I’m lost. Anyone mind telling me, if they’re correct and if so, why?

The past few years, central banks were giving out interest rates of 0% or even negative percentages. Regular banks would not quite pass this on, but you could still loan money and give it back later with no real interest payments.

This lead to lots of people investing in companies. As long as those companies paid out more money than those low interest rates, it was worthwhile. But at the same time, this meant companies didn’t have to be profitable, because they could pay out investors from money that other investors gave them???

This has stopped being the case, as central banks are hiking interest rates again, to combat inflation???

    • nuxetcrux@lemmy.world
      1·
      1 year ago

      Peasants’ revolts for rights and pay after post plague labor shortages are examples of this–sometimes going “on strike” by moving away but still nearby to demonstrate their newfound value and agency.

      Unfortunately this current cycle seems irresistibly headed toward mass death, as income inequality paired with a technological revolution amidst limited existential resources: people must die, mathematically. There will be large migrations, droughts, famine that kill in large numbers, but it won’t be happening to anyone that matters.

      I think the temptation to keep the population low and existence reserved solely for eugenic elite will be too great and these rich demigods will want lebensraum–physically and ideologically–and social spaces will be in service to them (Twitter–>X), but really, as in, reality will eventually be made to bend to this logic and we will be too weak to defend ourselves as a race because entertainment will feel more important than water.