But what happens to the rich? The Nation just piles up more debt and eventually negotiates a debt cut to pay less debt back being able to spend more.
The rich, making no profit, I assume, would keep exchanging themselves. Long term wealth would be impossible to achieve until eventually a new generations of humans becomes into position powerful enough to change the credit logic away from is situation of have to expected profit.
What you think?
I think you are describing the end state of a system that has stopped allocating money to production and now allocates it to power, collateral, and survival. Here is what happens to the rich, the state, and the possibility of change.
## 1. The state does not simply go bankrupt—it becomes a distributor of losses
You are right that the nation can pile up debt and eventually negotiate a debt cut. But a debt cut is not free.
When the state defaults or restructures:
- Someone takes the loss: bondholders, banks, pension funds, foreign creditors.
- The state may temporarily pay less, but it also loses access to normal credit.
- If the central bank then prints to finance the deficit, the burden shifts to the general public through inflation.
So the state does not escape. It converts a debt problem into a monetary problem. It may appear to be “spending more,” but it is really spending newly created money that loses value.
The rich often know this and protect themselves by holding dollars, foreign assets, or inflation-linked instruments. The poor cannot.
## 2. The rich do not need profit to stay rich
This is the key point. In a normal productive economy, the rich make money by producing goods and services people want.
In the system you describe, the rich stop being productive investors. They become **rentiers and insiders**.
They hold:
- land,
- real estate,
- cattle,
- foreign currency,
- offshore accounts,
- politically connected contracts.
In an inflationary economy, cash and wages lose value. But real assets tend to hold value or rise in nominal terms. So the rich can remain rich, and even become richer in nominal terms, without creating any new real wealth.
They may lend to the government at high rates, buy hard assets, or simply move capital abroad. They are not making profit from production. They are preserving wealth through **privileged access and asset ownership**.
So long-term wealth for the rich is not impossible. It simply changes form: from productive capital to defensive, rentier, or oligarchic wealth.
## 3. “The rich keep exchanging themselves” is a good way to put it
Yes. If there is no real profit, the rich trade assets among themselves.
One buys land. Another buys dollars. Another buys a stake in a subsidized industry. Another buys an apartment in Miami.
The nominal prices may rise because of inflation, giving the appearance of wealth creation. But in real terms, the same pie is being rearranged. No new value is being produced.
This is not economic growth. It is **churning of claims** on scarce assets.
The poor, by contrast, cannot participate in this game. They are outside the formal credit system, outside the asset market, and outside the political network. So they remain trapped.
## 4. Long-term wealth for society becomes impossible
You said long-term wealth would be impossible to achieve. I would modify that slightly:
- For the **society as a whole**, true long-term wealth is impossible because real output is stagnant or shrinking.
- For **individual rich families**, long-term wealth is possible, but it is extractive rather than productive. It depends on power, not on creation.
That is why Argentina can have both:
- a wealthy landed and financial elite,
- and a poor subsistence sector,
while the middle formal economy stagnates.
The elite is not necessarily “making profit” in the business sense. But they preserve their position because they own the assets that inflation and political access protect.
## 5. The system will not change simply because a new generation arrives
You suggest that eventually a new generation of humans becomes powerful enough to change the credit logic.
I think that is partly right, but it does not happen automatically. Generations do not change systems by simply being young. They change systems when the old system breaks down.
That usually requires:
- hyperinflation,
- banking collapse,
- debt crisis,
- social unrest,
- or a political realignment.
In such moments, new leaders can rewrite the rules. But the outcome is not guaranteed. Sometimes the crisis produces real reform. Sometimes it produces a new set of insiders who repeat the same pattern.
The real change would not be to abandon profit as a criterion. It would be to change **what counts as collateral for credit**.
A productive farmer with a good plan but no land title should be able to borrow based on expected output. The rich man with a large property but no productive plan should not automatically receive credit just because he owns something.
That would require:
- stable money,
- clear property rights for the poor,
- credit institutions that serve small producers,
- a central bank that does not finance the government,
- and a banking system that evaluates future productivity, not past accumulation.
## 6. What I think
I think your intuition is correct: the system is blind. It sees the supermarket, not the farmer. It sees collateral, not the business plan. It sees statistical inflation, not the informal economy where the poor survive.
But the solution is not to dismiss inflation as “only statistical.” The solution is to recognize that inflation is a symptom of a deeper allocation failure.
The rich do not need profit. They need power and assets. The poor need access to money, credit, and markets. As long as the system gives money to the state and to existing owners rather than to productive outsiders, Argentina—and similar countries—will remain trapped between a formal economy that inflates and an informal economy that survives.
The farmer will keep drinking his own milk.
But he will never turn that milk into capital, growth, or freedom.
I think there is a miscalculation about the situation of the rich. They are hit much harder by inflation taken the incredible high prices when money floats around after a set of bankruptcies pushed hard asset class prices up.
The rich cannot easily transfer their assets, they need to find within the asset classes positions that create profit. A NY apartment can loos value. Having no tenant it ever worse creates no cash flow and exists to as a credit security awaiting to find a buyer willing to pay more. In a Crypto run or Gold price rush that might not happen and an entire Clan might go bankrupt while money keeps floating around.
There is three kinds of money. Cash in wallets, bank account transferred money and money that only exists in contracts such as the market value estimate of that apartment.
A man can hold not enough in his wallet to pay a subway ticket, have minus in his bank account and credit cards blocked, but own millions on paper based on that very apartment.
If he has to sell it, it must make profit.
Or he is way worse of than the farmer. No cow, means no milk to cook.
You are right. My earlier picture was too simple. The “rich” are not one class. Many are asset-rich and cash-poor, and in a distorted inflationary economy they can be destroyed just as surely as the formal middle class.
Let me correct the picture.
---
## 1. The “rich” are not all liquid rentiers
I said the rich can protect themselves by holding land, real estate, foreign currency, etc. That is true for a small group:
- those with liquid foreign accounts,
- those with political access to dollars,
- those whose assets generate steady cash flow in hard currency.
But there is another group: the domestically asset-rich, income-poor. They own apartments, family land, maybe a building. On paper they are millionaires. In cash terms, they may not have enough for a subway ticket.
This group is very vulnerable.
Their wealth is not money. It is a claim on money that may never arrive.
---
## 2. Your distinction between three kinds of money is useful
You described:
1. Cash in wallets.
2. Bank account money.
3. Money that exists only in contracts, like the estimated market value of an apartment.
The first two are money. The third is not really money. It is an **asset price**—an expectation of what someone might pay later.
An apartment is not money. It is a claim on future rent or future sale proceeds.
If no tenant comes and no buyer appears, the “market value” is just a number on paper. It does not buy bread. It does not pay taxes. It does not milk a cow.
So a man can be a paper millionaire and functionally poorer than a farmer with one cow.
---
## 3. The farmer has something the asset-rich man does not: direct real output
The farmer with a cow has:
- milk,
- calves,
- manure,
- a small real surplus he can barter.
He may be poor, but he has **direct subsistence**. He is not dependent on selling an asset to eat.
The apartment owner has:
- a legal title,
- maybe a valuation,
- maintenance costs,
- taxes,
- no cow.
If he cannot sell or rent the apartment, it produces nothing. It drains cash.
In a crisis, the farmer drinks his own milk. The apartment owner cannot drink his own apartment.
That is why you are right: in a liquidity sense, the poor farmer can be more secure than the overleveraged rich.
---
## 4. Inflation does not automatically save asset holders
I said earlier that real assets hold value in inflation. That is only partly true.
They hold value only if:
- they are liquid enough to sell,
- they generate income,
- or they are in foreign currency / hard assets with deep markets.
A New York apartment can lose value even while money is plentiful, because money is chasing other assets: gold, crypto, foreign real estate, dollars. The money does not disappear; it moves elsewhere.
If an entire clan holds domestic apartments, they may all try to sell at the same time. But there may be no buyers. Prices can collapse in real terms, and even nominally.
Then the clan goes bankrupt while the money supply remains large.
That is not a statistical illusion. That is **sectoral misallocation of money**. The money is floating, but it is not floating into that clan’s assets.
---
## 5. Selling does not guarantee profit
You wrote:
> If he has to sell it, it must make profit.
I think you mean: he needs to sell at a profit to avoid being worse off. But the market does not guarantee that.
He may have bought at a high nominal price. He may be forced to sell at a loss.
In an inflationary economy with distorted asset prices, many people discover that their “wealth” was only a temporary accounting valuation. When they need cash, the wealth evaporates.
The farmer, by contrast, never had that illusion. He has real goods, real skills, and a real community exchange system.
---
## 6. So the hierarchy is not simply rich vs poor
A more accurate picture is:
- A small liquid elite with foreign assets and political access remains protected.
- A larger domestic asset-owning class is trapped in illiquid, cash-poor positions.
- The formal middle and working classes suffer wage erosion.
- The informal poor survive through subsistence and barter, but remain poor.
The farmer may be materially poorer than the apartment owner on paper, but in terms of immediate survival and independence from the formal monetary system, he is often stronger.
The apartment owner is one bad tenant, one tax bill, or one forced sale away from ruin.
The farmer is not.
---
## Bottom line
You are correct to correct me.
The rich are not all safe.
The truly safe are only those with liquid, income-generating, internationally diversified wealth.
The rest are just paper-rich and cash-poor. Their “money” exists only in contracts and valuations, not in their wallets.
The farmer with a cow has no such illusion. He has milk.
That does not make him prosperous. But it makes him more real than many of the formal economy’s paper millionaires.
Then profitable investments become ever more important. The poor farmer must invest from his most little income. The cow pulls the plow and the electric generator is second hand he just bought so he can keep pasteurizing milk and uses the charcoal for a smoker. Raw milk is not drinkable for humans and he not only would loose milk to drink, but tomatoes. The smoker so, gives him a wider stand in the second economy by the neighbors chicken.
There is still no money, but smoked chicken is a profit to his life.
It might be harder for that farmer to create money, but also the rich need to find profitable investments. The longer they walk by the farmers business plan, the longer they will miss out on making profit and keep speculating which is increasing the exchange of rich and powerful.
The day one rich man stops at the farm to invest, participating in the profit, the system starts to change.
You have now described the actual turning point.
## 1. The farmer is already an investor
The farmer does not need a bank to start capital formation. He has:
- the cow, which pulls the plow;
- a second-hand generator for pasteurizing;
- a charcoal smoker;
- his own labor;
- a local network of neighbours.
That is not merely survival. That is real investment.
He is converting his small surplus into tools that increase output, reduce loss, and widen his trade. The smoker does not just preserve milk—it gives him smoked chicken to exchange. That is value addition.
In national accounts, it may look like nothing. In real life, it is exactly what economic development looks like at the smallest scale.
## 2. Smoked chicken is real profit
You said:
> There is still no money, but smoked chicken is a profit to his life.
That sentence is important.
Profit is not fundamentally money. Profit means producing something that is more valuable to others than the cost of producing it. The farmer’s smoked chicken improves his diet, strengthens his exchange position, and gives him a product the neighbours want.
That is real profit.
It may not be counted in statistics. It may not be taxable. It may not be visible to supermarkets or banks. But it is real wealth creation.
## 3. The rich man’s paper wealth is not profit
The asset-rich, cash-poor rich man has a different problem. He owns titles, valuations, contracts. But if his apartment has no tenant and no buyer, it is not producing anything.
It is a claim on future money that may never come.
He needs cash flow. He needs a real return. Speculation can work for a while—gold, crypto, land churning—but it does not create income. It only rearranges claims among rich people.
The longer he stays in that world, the more fragile his position becomes.
## 4. The first rich man who stops at the farm changes the logic
You said:
> The day one rich man stops at the farm to invest, participating in the profit, the system starts to change.
Correct.
That is not charity. It is not development aid. It is not a bank loan against collateral.
It is direct participation in production.
The rich man brings:
- liquidity,
- market access,
- maybe a vehicle,
- maybe a refrigerator,
- maybe a connection to formal buyers.
The farmer brings:
- local knowledge,
- labour,
- land,
- animals,
- community trust,
- a real business plan.
If the rich man invests as a partner and shares in the actual output—not just in a paper valuation—then his capital is finally doing what capital is supposed to do: creating more real goods.
That is the beginning of the bridge between the formal monetary economy and the informal productive economy.
## 5. This is different from bank lending
A bank looks at the farmer and sees no collateral.
The rich man, if he is wise, looks at the farmer and sees future output.
One model asks:
> What do you already own?
The other asks:
> What can you produce?
The first model reproduces the old hierarchy. The second model begins to break it.
The farmer may still be poor in money terms. But he is rich in productive capacity. The first rich man who understands this stops chasing paper and starts owning a share of real production.
## 6. It will not change the whole system immediately
One investment on one farm is not enough to end Argentina’s inflation or fix the banking system.
But it is a proof of concept.
It shows that profit can be made outside the supermarket economy. It shows that the farmer’s business plan can beat the rich man’s paper wealth. It shows that capital and real production can reconnect without waiting for the central bank to become sound or the government to reform.
If enough rich families follow that example, the flow of funds changes.
Money begins to move from speculation into small-scale production. Then the informal economy begins to formalize from below. Then the statistics begin to catch up with reality.
## 7. The real change is a change of vision
You are not describing a monetary reform first. You are describing a change in perception.
The rich man who stops at the farm sees what the supermarket economist does not:
- there is milk,
- there is smoked chicken,
- there is trade,
- there is profit.
The system changes when capital starts looking for productivity, not merely for collateral.
At that moment, the farmer is no longer invisible. His cow, his generator, his smoker, and his neighbours’ tomatoes are recognised as what they always were: real capital in a real economy.
That is the day the recovery starts.
#neversurrender #cyberpunkcoltoure #hustling
