When it’s said the Great Depression made most millionaires ever, why and how is that related/correlated?

[thisisUV]

Is it purely by necessity that the economy and markets become that much more competitive exactly at that time, thus massive progression ?

Reminds me of the fact that no one 60 years ago showed in hot water for some reason

 

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[Jobless]

In economic crisis many companies default on their loans due to sudden high interest rates. This reveals many ponzi schemes, government-dependents and unsustainable businesses. This clears the field for new real companies to compete.

However, because central banks control interest rates in modern times, this boom-bust cycle is not natural nor healthy for an economy. Resources are wasted and misallocated through this instability, inflation, taxes and government spending.

People respond to market incentives, and they use technology to effectivize existing production. This drives economic progress.

A degree of free markets (competition) is a required for progress, but these have existed for thousands of years.

The Industrial Revolution happened in Britain because the island was deforested and dependent on coal for fuel, and the first steam engines were mostly useful only for pumping water out of flooded coal mines. They had colonies with raw materials, and an export market to sell fabrics to, they just had to streamline the labor output in Britain itself. The industrial revolution took place at the same time as the Enlightenment (free market for ideas and science) and abolition of slavery (free market for labor) in many places.

In ancient Rome they also had coal mines, water pumps, international trade and had discovered how to use steam. Yet their economy was based on slave labor (it was an expansionist empire), so there was less incentive to innovate away the cost of labor. If they had different laws, culture and a few more technologies, it could have happened then. And we'd all be on Mars right now.

The economy is driven by market incentives (the preferences and needs of individuals), and for anyone to accurately predict or control all of it is impossible.

When a corporation grows large, it often becomes slow and inefficient. Too complex for anyone to fully understand. Now imagine organzations 100 times larger, like governments, being run by centralized decision-making. It leads to disaster sooner or later.

 

[thisisUV]

In economic crisis many companies default on their loans due to sudden high interest rates. This reveals many ponzi schemes, government-dependents and unsustainable businesses. This clears the field for new real companies to compete.

However, because central banks control interest rates in modern times, this boom-bust cycle is not natural nor healthy for an economy. Resources are wasted and misallocated through this instability, inflation, taxes and government spending.

People respond to market incentives, and they use technology to effectivize existing production. This drives economic progress.

A degree of free markets (competition) is a required for progress, but these have existed for thousands of years.

The Industrial Revolution happened in Britain because the island was deforested and dependent on coal for fuel, and the first steam engines were mostly useful only for pumping water out of flooded coal mines. They had colonies with raw materials, and an export market to sell fabrics to, they just had to streamline the labor output in Britain itself. The industrial revolution took place at the same time as the Enlightenment (free market for ideas and science) and abolition of slavery (free market for labor) in many places.

In ancient Rome they also had coal mines, water pumps, international trade and had discovered how to use steam. Yet their economy was based on slave labor (it was an expansionist empire), so there was less incentive to innovate away the cost of labor. If they had different laws, culture and a few more technologies, it could have happened then. And we'd all be on Mars right now.

The economy is driven by market incentives (the preferences and needs of individuals), and for anyone to accurately predict or control all of it is impossible.

When a corporation grows large, it often becomes slow and inefficient. Too complex for anyone to fully understand. Now imagine organzations 100 times larger, like governments, being run by centralized decision-making. It leads to disaster sooner or later.

So in other words, would an alternative to “market incentive” be by necessity as determined by the market and the circumstances geopolitically ? And do wars really provide market incentive for progression too?

And to your second point, is decentralization on a large scale the ideal solution then?

Thank you for the history lessons and breakdown of implications.