Here’s exactly what would happen if everyone in the world got a million dollars
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Today I wanted to talk about what would happen if everyone in the world got one million dollars and suddenly everyone became millionaires. Because as of right now, millionaires make up roughly 0.9% of the our world and yet, they own about half of the world’s entire wealth at $361 trillion dollars in approximate value, while the bottom 56% or roughly 1 out of 2 own only 1.8% of the global wealth according to the annual Global Wealth Report: https://bit.ly/3nuuBVx
The idea of giving people money is becoming really popular lately especially when it comes to what’s been going on in the world with talks of more stimulus for the economy and even other universal basic income plans like Andrew Yang’s plan which comes in the form dividend payments of $1,000 a month. But let’s go on the extreme end of things for argument sake and assume that everyone all of the sudden got a million dollars over night. For most people, if they got one million dollars they’d probably be very happy about that and they’d have lots of ideas on how to spend that money.
For example, the Charles Schwab Modern Wealth Survey asked people what they’d do if they got one million dollars and they found that 21% of people or a 1/5th said they would save it for a rainy day which is smart because one of the keystone principles of personal finance is to have an emergency fund that covers at least 3 to 6 months of expenses, that’s one of the first rules of basic financial literacy.
Another 23% of people said they would invest that money which is smart. If you can invest one million dollars the right way, you can actually live your entire life withdrawing $40,000 a year and theoretically never run out of money because your money would grow faster than you can spend it. All you have to do is buy something like VTI which is an index ETF that tracks the total US stock market and hold on to it for the long term and it should return around 7% per year (over the long term)
Another 28% said they would pay down debt which is also extremely smart because the worst form of debt is credit card debt where the interest that people pay on credit cards can be upwards of 23% so getting rid of bad debt is smart and should always be a priority. Lastly, over half of the people polled or 54% said they would spend it on a house, a car, or leisurely expenses like traveling. But what if people actually got that million dollars?
If that were to happen for real, the first thing people would do is go out and start buying stuff in mass so you’d get massive amounts of traffic, accidents, and problems not unlike the Black Friday shopping deals we see every year. That’s because as the announcement of this million dollars hits, it’s going to take into effect piece by piece but not all at once because businesses have to adjust their prices just to make sure they have enough supply to meet this insane spike in demand from all these newly minted millionaires.
Businesses would not be able to supply everyone with enough stuff so grocery stores, movie theaters, restaurants, and basically every business that sells a product or service will be forced to shut down in order to re price everything to reflect this new demand. As a result, the dollar menu in McDonalds now becomes the $100 menu. A Toyota Corolla would increase from $15,000 to $150,000, and digital currencies like BTC almost literally go to the moon. This is also true for rents and home prices because they would skyrocket 100% or more almost overnight just because landlords know they can increase rent prices across the board and people would be able to afford to pay them.
Overall the cost of living across the board would go up and most people would go broke again over the span of six months to one year. There’s a few more interesting things that would happen and actually are happening in the world right now due to hyperinflation which the video discusses.
*None of this is meant to be construed as investment advice, it’s for entertainment purposes only. Links above include affiliate commission or referrals. I’m part of an affiliate network and I receive compensation from partnering websites. The video is accurate as of the posting date but may not be accurate in the future.
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what would you do with a million?
imagine ramen costing $100
1 million would become worthless
UBI – the great resignation, no incentive to work
There would not be inflation with a one-time payment of a million dollars. Inflation is only able to go up and stay up with people's INCOME, not their wealth. Prices may go up immediately after, but then they'll come crashing right back down to where they were before after a short time.
There is the incoming robotics and automation that is already taking over the workforce, with an expected workforce reduction of 20-40% in just 5-10yrs from now (nearly all fields of work are targeted: manufacturing–entire factory with no workers, distribution–entire warehouse and even the shipping with no workers, hospitality–entire stores with just stockers, involving paperwork, military–yes robot tanks 'Uran-9'). This is why UBI is such a thing. No starting capital to invest anything, you just leave people with no options. The phrase ' just get a job ' won't work, because there literally isn't any.
This has nothing to do with UBI.. UBI only covers basic survival costs, at best.. People are still supposed to find other sources of income if they want to have more money than the bare minimum. What you're suggestion has entirely different outcomes, and thus this video should not be titled as or referring to "basic income".
A properly done UBI does not have such inflation concerns, and would actually strengthen capitalism and give more consumers more bargaining power in the free market. If some jerk decides to raise his prices (simply because he thinks his consumers have more money to blow), people can shop elsewhere, or even setup a competing business.
Good talk💯
Thank you very much🤍
You totally didn't understand UBI. Of course money for UBI won't be printed. It's gonna be from tax payers, so in order to finance that, you'll need to increase taxes. So even tho, milionaire will get the same $1000 check every month, he will pay so much more on the tax increase. UBI is redistributing money from rich to poor. And it is because, big companies don't need workers anymore, because of robotization. So there will not be enough jobs for all people. UBI should solve this. And of course amount of UBI money, will depend on unemployment rate. If too high UBI will increase, if too low UBI will decrease, to get workers back to jobs.
I would walk around asking persons for $10k. Being that it is 1% of their 1mill … rising myself above average
Have you heard of the euros and how badly that has turned out?
Ok, I'm not mad at any of the points made in the video, except for the part where you're using the idea of everyone getting a million dollars as a stand-in for everyone getting a thousand dollars. Sure, supply and demand is still a thing, but I've been trying to exhaustively research UBI proposals/philosophy/data in an effort to put together a really solid argument in favor of it, both philosophically and fiscally, and at no point have I ever come across any proposal for UBI that involves making everyone a millionaire. That feels like a little bit of a straw man on the concept. If millionaires still exist, and we're just ensuring that everyone is at least a dodecathousandaire, then…. millionaires still exist, and they're still way above people who are suddenly $12K/year richer. And if every single person already had all their basic necessities provided for, sure, a lot of them would probably spend their UBI on luxury goods…. but I think the people who are struggling to eat or to pay rent are likely to use their UBI on that first. Getting a million dollars is so very much not the same thing as being brought up to a basic level of income needed for not dying. And sure, landlords might try to charge more for rent… but there's a world of difference between landlords knowing everyone has an extra million and landlords knowing that everyone has an extra thousand… and again.. people with far more money than that still exist, so.. those people are going to want super luxurious places to live, whereas those who are subsisting on their UBI and some low-paying job are going to settle for less, and landlords are going to have to charge less for the low-end places than for the ultra-luxurious places, soooo..
Also, no UBI proposal that I've seen has ever involved spontaneously printing money out of thin air… it's always been about rebalancing how the government is spending its existing funds.
I am your fan, I will always support you💯💯
I'd burn it for heat.
I wouldn't be able to afford anything.
The problem is there is no problem
I'm venezuelan, watching this video from Venezuela …. Very shocking to see bolivares in your videos 😂, thanks for your amazing job andrei!
Andrei showed many bills with the same denomination wich are "bolivares fuertes (BsF)", and "bolivares soberanos (BsS)"
where 100000BsF = 1 BsS
And yet we just got a
1 million BsS bill…. Wich is around 0.4USD🤯
Don't print money long term, just… Think about it…. There is no free lunch
Here's the kicker giving 1m$ would definitely hurt the country where as giving people 1k$ would do nothing but improve the lives of the lower class and poverish people while improving cash flow but work even better if we actually tax the wealthy and people's incomes will still differ in a good way because people will still work while receiving UBI hence this video makes absolutely no sense
Love you Andrei, but this is like when we hear doubters talk about crypto who clearly have done little research or just heard one side of it. Read Andrew Yang’s book.
Way to stay in character Andrei
Lol what about taxes for the 40k? And inflation? And framing UBI so terribly
Garbage
I think even though UBI and getting a free 1mil is not the same. The idea of everything becoming more expensive still stands. Asset prices will rise, just not at the same level over time.
I love currency artwork also, im starting to collect them too.
This is a profoundly dishonest argument
inflation… it won't change a thing. but it's not the same as universal basic income
Most versions of "universal basic income" give people 1k/month or 12k/year. The video's Title is misleading.
The Fed could very well write off the USD bonds and other debt assets purchased (which is now mostly how it prints money ). US government debt held at the Fed is not "real debt" in the sense that it can be written off whenever as the Fed is not obligated to collect the principal and interest of the debt (which effectively lowers the money supply) if there's no threat of inflation. This is of course much different then US govt debt held by investors or other countries which very much want to have payment. Also, there is value in being able to control the money supply as it helps cushion recessions and cool down over heated expansions. We can't do that with decentralized money unless it is coded in to increase supply in recessions and decrease in expansions..a good exemple of the need to control its own currency: Greece debt crisis. Anyways, a good book to read about this: Debt crises by ray dalio
What does this have to do with UBI? If everyone got a million dollars is A LOT different than everyone getting $1,200/month
This has absolutely nothing to do with universal basic income….
Buy a nice house.
I quit drinking in December and put the money I would turn into peepee into my WeBull account …50 bucks every Monday . I'm up to $200 bucks right now. Its a slow grind but much better than filling the toilet. , I wish I had done this years ago…
I would pay my house off then start stock piling square body trucks
I love your channel
I think a lot of people would prematurely quit working and things like that, just cuz you give someone a bunch of money doesn't mean you give them the intelligence to use it as intended.
What is Google's Gil? I couldn't find anything about it Googling it! LOL
Andrew Yang has entered the chat.
I think Andrei is suggesting we end the federal reserve. Without saying so directly (see JKF) lol
Please change your title. I normally really respect your well researched and detailed videos and simple explanation. Not only does this fail to explain or even mention what UBI is. Its purposely misleading and throwing an unintentional straw man to the idea of UBI. I would love to see what your actual thought on UBI is instead of throwing this fake title talking about a thought experiment.
On your point with capitalistic currencies… thats totally insane. Imagine running a business in the modern age that have to accept the usd, rmb, hkd, euro, pounds, asd, cad at the same time. It would be a complete nightmare. Yes credit/debit cards do this automatically but you have to pay an insane amount of fees. Creating a non national currency would create much more chaos than the million dollar thought experiment