Comment on How the Rich Got RichparentComments−eli_gottlieb14yYou convert capital into ordinary purchasing power by using the money to buy something. This shifts the money from the column labeled "aggregate capital stock" to "aggregate demand for goods and services."−justinmk14yGiving money to consumers doesn't lower the aggregate supply of real capital, it just sends false signals to producers (and consumers).
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You convert capital into ordinary purchasing power by using the money to buy something. This shifts the money from the column labeled "aggregate capital stock" to "aggregate demand for goods and services."
Giving money to consumers doesn't lower the aggregate supply of real capital, it just sends false signals to producers (and consumers).