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The Almighty Buck IT Technology

As Robots Eat Our Jobs, Fed Should 'Drop the Money From Helicopters,' Says Bill Gross (janus.com) 372

As technology continues to change the world -- and kill many jobs -- it may soon change the very nature of what is considered work, said Bill Gross, a renowned American financial manager in his recently released investment outlook. Gross says that in a year or so we will need to start guaranteeing income for everyone. Gross, added that the current crop of national leaders is hopelessly behind the curve, leaving it to central bankers to fix the mess. "Our economy has changed, but voters and their elected representatives don't seem to know what's really wrong," he writes. "They shout: (1) build a wall, (2) balance the budget, (3) foot the bill for college, or (4) make free trade less free. "That will fix it" they discordantly proclaim, and after November's election some unlucky soul may do one or more of the above in an effort to make things better. Similar battles are being fought everywhere." The Sydney Morning Herald reports: Central bank "helicopter money" will avoid a long recession that looms as millions of millennials face losing their jobs to robot technology, Gross says. In news that is sure to depress anyone under the age of 30, Gross says that while presidential hopefuls in the US spout mantras about how they are going to spur growth, none are addressing the reality of the future: that robots and technology are going to render "millions" of jobs redundant. "Virtually every industry in existence is likely to become less labour-intensive in future years as new technology is assimilated into existing business models," Gross writes. Transport is a visible example of this transition and millions of truck and taxi drivers will be out of a job in the next 10 to 15 years due to driverless vehicles, he says. "We should spend money where it's needed most -- our collapsing infrastructure for instance, health care for an aging generation and perhaps on a revolutionary new idea called UBI -- Universal Basic Income."
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As Robots Eat Our Jobs, Fed Should 'Drop the Money From Helicopters,' Says Bill Gross

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  • by turkeydance ( 1266624 ) on Thursday May 05, 2016 @06:13PM (#52056737)
    is just a bunch of robots. SKYNET drops the money as human bait.
  • by Greyfox ( 87712 ) on Thursday May 05, 2016 @06:16PM (#52056755) Homepage Journal
    Hooray! I'm in my mid 40's and if I'm lucky I'll die of ass cancer in the next 5-10 years! Sucks to be the millenials, their future is much less bright!
    • by Anonymous Coward on Thursday May 05, 2016 @06:46PM (#52056983)

      But everyone is missing the bigger problem.

      Once there are no jobs, because everything is being done by robots and/or artificial intelligence, all of these companies who have no employees will have no one to sell their products to because no one will have any money to buy them.

      • by rmdingler ( 1955220 ) on Thursday May 05, 2016 @06:54PM (#52057045) Journal
        FTA: While socialist in theory, Gross says the idea has support among more conservatives than liberals and is the rage in Silicon Valley – how else will a shrinking workforce pay for the latest gadget?

        The article is only suggesting $10,000 as a basic yearly income, so it's not like the living will be large without some income augmentation.

        It will, as a plus, create a bit of inflation that would actually reward folks who save money.

        • by drinkypoo ( 153816 ) <drink@hyperlogos.org> on Friday May 06, 2016 @08:19AM (#52059663) Homepage Journal

          It will, as a plus, create a bit of inflation that would actually reward folks who save money.

          Uh, what? That's not what inflation does. In fact, it does the exact opposite. Inflation decreases the value of hoarded cash. It punishes people who save money. That's OK, because we really need them to invest that money, so a steady, fixed and predictable rate of inflation is actually desirable. The problem with inflation, of course, is that the minimum wage hasn't kept up with inflation in over twenty years. Without a congress willing to increase the minimum wage regularly to match inflation, the poor are punished for existing.

        • I don't see how it would create inflation, that idea doesn't mesh with any existing theories of how inflation works. In fact, that's the "rising tide causes inflation" argument often used by opponents of UBI and minimum wage increases.

      • by Hylandr ( 813770 ) on Thursday May 05, 2016 @06:58PM (#52057071)

        This isn't hardly news. It happened in the 80's when Auto manufacturers began putting bots on the assembly lines.

        Everyone adjusted and there wasn't a 'basic income' needed.

        • If by "adjusted" you mean "accepted wages low enough to make robots unattractive because they have to be bought while you can simply dump a human after you're done using it, and there's no maintenance cost for humans since they're easier to replace" then yes.

        • This isn't hardly news. It happened in the 80's when Auto manufacturers began putting bots on the assembly lines.

          Everyone adjusted and there wasn't a 'basic income' needed.

          Different conditions. Automation booted a lot of workers (not to mention the auto industry was getting a pummeling from the Japanese and German auto makers.) And currently the "traditional" auto makers in the rust belt are getting a pummeling by factories in Mexico and foreign manufactures setting up shop in at-will states in the south.

          But here is the big difference between then and now/the near future: job decimation wasn't widespread then. People simply went to work somewhere else. Some with better wage

      • This is very true. The problem is that the system is very fragile and neither the corporations or the people are thinking about this. Everyone wants everything fixed now, but they aren't looking at the big picture/real problem. As an example. People want to stop climate change. Most peoples' answer to this is to stop using fossil fuels, and convert everything to electric. Although this is a good answer in theory the problem is where do people think that Electricity comes from for the most part? Electricity
      • That problem is already here. The economy immediately tanked as soon as spending became impossible for the majority of people in the US. We are essentially repeating the 1930s. People lose their jobs, have no money to buy stuff, which in turn means companies can't sell their products, which closes companies, which makes people lose their jobs.

        Back then what the government did was to create huge projects like the Hoover Dam to employ people and restart the economy. But I doubt that's possible today. First, b

        • What restarted the economy was the WAR, not the economic stimulus.

          More importantly the giant shot of confidence after winning the WW2 that made people think they could do anything.

          • It didn't hurt that every economic competitor the US had after WWII was too busy rebuilding all their infrastructure to stand much chance against US companies.
        • by pnutjam ( 523990 ) <slashdot@borowicz. o r g> on Friday May 06, 2016 @10:03AM (#52060229) Homepage Journal
          Pick up "Only Yesterday: An Informal History of the 1920s", by Frederick Lewis Allen. The ebook is on Gutenburg Australia. It's an eye opening read, amazing to see how much history just gets repeated.
          All his books are good, I can't recommend them enough. My entire working life, started in 2001 has seemed like a slow motion replay of the 1920's.
      • by Wycliffe ( 116160 ) on Thursday May 05, 2016 @11:20PM (#52058361) Homepage

        But everyone is missing the bigger problem.

        Once there are no jobs, because everything is being done by robots and/or artificial intelligence, all of these companies who have no employees will have no one to sell their products to because no one will have any money to buy them.

        Nonsense. We are just moving back to the way it used to be where one family had a plantation and had 20 servants and 300 slaves. Even if we're lucky and the computers are the slaves, the servants still make 1/40 what the plantation owners make. That's the service industry that we're moving to where the lucky few have great paying jobs and the rest are barely surviving. There are plenty of places like this around the world, here in the USA we are used to the difference between the rich and the poor generally being less than 1 order of magnitude ($8/hour to $80/hour) but more and more of the wealth is starting to go to the people outside of this range.

  • The concept of helicopter money's been making the rounds as a more effective alternate to QE money (QE gives the money to governments, who may end up spending it unwisely), but it should be noted that it's a direct response to deflationary pressures around the world that's attacking currencies and sapping credit. Helicopter money the economic concept is only meant to be applied until the threat of deflation goes away - a UBI is a social policy, not a fiscal one.

    It would be interesting to explore how a UB
    • Pulling off a UBI or printing the money to fund it rather than raising it via taxes?

      There is nothing stopping any country from implementing a basic income stream if their tax take can handle it. I would suggest that the Scandinavian countries are the ones that will have the easiest time of it as it is a relatively small step for them given their higher tax rates and higher social security contributions.

      • by JanneM ( 7445 )

        Helicopter money is a temporary intervention, though, while UBI is meant to be permanent. At best, you could use the helicopter money angle to cover the initial startup and adjustment costs of an UBI implementation. But the long-term financing will need to be from elsewhere.

  • by Anonymous Coward

    Spilled my drink once I got to "leaving it to central bankers to fix the mess".... Smells like another scam

  • Bill Gross (Score:5, Interesting)

    by 110010001000 ( 697113 ) on Thursday May 05, 2016 @06:23PM (#52056811) Homepage Journal
    Bill Gross is a con artist and part of the 0.000001% and made billions through junk bonds. Don't trust anything he says.
    • Re:Bill Gross (Score:5, Informative)

      by JoeyRox ( 2711699 ) on Thursday May 05, 2016 @06:41PM (#52056945)
      You have BIll Gross confused with someone else, perhaps Michael Milken. Gross doesn't issue junk bonds like many of con artists of the past - he invests in them, along with lots of investment grade and government bonds as well. He became wealthy by having an uncanny ability to predict where the economy (and in turn the bond market) will go during his 30+ year career.
      • I didn't say he issued them. He didn't get rich by having an "uncanny ability".
        • Then describe why you believe Bill Gross is a con artist. He's the most respected bond investor of his generation.
  • Better idea (Score:4, Interesting)

    by rossdee ( 243626 ) on Thursday May 05, 2016 @06:25PM (#52056821)

    Dropping condoms from helicopters would seem to be more effective.

  • by Tablizer ( 95088 ) on Thursday May 05, 2016 @06:29PM (#52056839) Journal

    Analysts have been puzzled why inflation has been so low, compared to a typical recovery. Economies typically do best at roughly around 2.2 to 2.5 percent inflation per year. But we've been hovering around 1.7%.

    It appears our GDP capability is expending due to automation and outsourcing, yet our money supply is not expending to match. Thus, we have too many idle people and factories.

    "Printing money" is one way to make them match. You don't risk runaway inflation if the capacity to produce is expending.

    Many dictatorships and non-democracies willingly subsidize the cost of their nation's labor because unemployed people riot and overthrow dictatorships. Thus, they keep their population busy and fed using various gimmicks to under-price their nation's labor (relative to consumption). Therefore, they are practically giving away free labor to protect their position of power.

    Robots and de-facto slaves are available to make more stuff, if only the money supply is freed up to allow them.

    (The morality of such de-facto slavery is perhaps an issue to be dealt with, but for here I'm focusing on just the economy and money supply.)

    • by Tablizer ( 95088 )

      Corrections and clarifications:

      "Expending" should have been "expanding".

      Robots and de-facto slaves are available to make more stuff, if only the money supply is freed up to allow them.

      Citizens of democracies are also available, and willing to participate.

      And "freed up" perhaps should also be "expanded". QE freed up the money supply but didn't really expand it in general. QE mostly just exchanged low-liquid assets for higher-liquid assets.

      • QE freed up the money supply but didn't really expand it in general. QE mostly just exchanged low-liquid assets for higher-liquid assets.

        Wow, check out the money supply graph [windows.net] (ignore the political text at the bottom if you like).

        The reason inflation didn't happen with that huge money supply increase is because money velocity decreased at the same time (I don't really understand why).

        • by sjames ( 1099 )

          Because it didn't end up in the hands of the 99% of the population who (collectively) do most of the spending. Prices on non-essential goods cannot rise if most of the population would be priced out of the market.

    • Re: (Score:3, Insightful)

      Comment removed based on user account deletion
      • Re: (Score:3, Insightful)

        by Tablizer ( 95088 )

        If you have evidence of a conspiracy to manipulate the CPI, please present it. Conspiracy theories are a dime a dozen.

        I know there are philosophical differences about the computation techniques, but that's not necessarily a concerted plot to manipulate the political system.

        And several metrics are provided to emphasize different things. Those who present the metrics do not force anyone to use one metric over another. The press typically has settled on one metric that has proven "good enough" over time. Ther

    • It's not that capacity is growing faster than the money supply but that demand is not growing. The two concepts are similar in theory (opposite sides of the same condition) but quite different in practice.
  • by Anonymous Coward on Thursday May 05, 2016 @06:34PM (#52056885)

    What will happen to all the robots producing fluorescent lights that will lose their jobs once all the other industries are taken over by robots that can work in the dark? How will they afford hydrolic fluid replacements and filter cleanings?

  • Simple Solution (Score:2, Insightful)

    by Anonymous Coward

    The simple solution is to move to a 20 hour work week.

    But it'll never happen.

    40 hours is enough to enslave us. 20 will let us explore on our own free will and surely will cause trouble for the illuminati.

  • by JoeyRox ( 2711699 ) on Thursday May 05, 2016 @06:36PM (#52056903)
    You must understand that Bill Gross was speaking in jest. He's a lifelong bond investor and the inflation he predicts from this strategy is anathema to bonds. Now he wouldn't mind some inflation if it meant the net interest rates would rise as a result (ie, interest on bonds minus inflation) but he doesn't expect that from the strategy he proposes in the article. Again, it was written in jest.
    • by Sibko ( 1036168 )

      Why would a GBI massively increase inflation?

      It's not printing new money, increasing the overall supply which devalues all pre-existing money. It's just a redistribution of wealth. (or as the proponents of it claim: A better and more efficient redistribution of wealth than currently existing welfare)

      As such I don't see how it can actually cause inflation to increase in any significant way. This really just sounds like one of those easy to parrot talking points that don't have any truth behind them; it sound

      • Because inflation is a function of money supply x velocity. The situation right now is a very large money supply but with slow velocity, ie the money is being moved around (spent) because most of it is being hoarded on balance sheets or non-productive investment. The remainder is being held by the ultra-wealthy but there's only so much they can buy (and what they are buying has seen enormous price inflation, such as fine art). Put that money into the hands of the masses and they'll put it to actual work, ie
  • the 8-year-old-girl Nike shoe-making model that operates for 18-cents a day will be released for purchase

    at those rates I won't need money, I'll have minions

  • transition and millions of truck and taxi drivers will be out of a job in the next 10 to 15 years due to driverless vehicles,

    How long have we been saying driverless vehicles will be 10-15 years away?

    • Since 2005. The first completion of the DARPA Grand Challenge is when autonomous cars started to be taken seriously.
  • by istartedi ( 132515 ) on Thursday May 05, 2016 @07:16PM (#52057193) Journal

    The Fed helicopters don't fly over normal people. They only have the ability to dump money on banks via mechanisms such as rates so low that the banks can arbitrage. None of that money goes where it's needed to stimulate the economy.

    AFAIK, only Congressional helicopters could deliver money to you and I, like they did with the stimulus checks a few years ago. It's almost certainly a fool's errand anyway, since it would screw up the dollar economy via runaway inflation if you did it too much.

    IMHO, it would be better to simply extend services like food stamps and housing subsidies to people who would usually be in higher income brackets. Particular sectors of the economy might be weakened, but you wouldn't destroy the monetary system wholesale. People who wanted something better than government cheese would still be encouraged to innovate, strive, and keep progress and productivity humming.

  • Re: (Score:2, Insightful)

    Comment removed based on user account deletion
  • by pellik ( 193063 ) on Thursday May 05, 2016 @08:22PM (#52057585)
    I've held this as a fun talking point for years. It's a fantastic way for a liberal like myself to break down barriers to discourse with hardcore conservatives about socialist ideology. It's clear that the jobs we are losing to automation are not being replaced by new industries at a fast enough pace to keep our ever growing population at full employment. We need to re-imagine the core of our society in much the same way as we changed during industrialization before the problem comes to a head, or we face the same or even greater pains many of the industrialized nations felt the last time society underwent such massive restructuring.
  • There's this bright shining lie (with apologies to Sheehan) in America that one can only achieve salvation -or something- via long, hard work. It's a lie.

    There is no reason anyone should work long hours, or even any hours at all (see The Diamond Age) once robotics proliferate. There are plenty of ways to be happy while not having a "job," and it's foolish to think that we should have to pay for goods and services that are produced at little to no cost.

    Part of the transition to a truly money-free society is the guaranteed minimum income, or similarly named government distributions to all citizens. It sure would be nice if the next step were to make the "standard' work week 30 or 25 hours. It's certainly doable.

I have hardly ever known a mathematician who was capable of reasoning. -- Plato

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