Maybe a better example would be a country getting leveled in a war. All of the money is still there, but now everyone is poor and has no net worth. How does that work?
It seems kind of like losing that amount of money, even though we didn’t?
In: 3475
>What’s it called if I buy something like a sandwich, then consume it, and the net worth of society has now shrunk by 1 sandwich?
That’s called an economy.
>Versus buying something that keeps its value.
that’s called an investment.
We can consider the sandwich as part of the upkeep cost of your human body.
If you do not eat, you’ll die, and be unable to work.
Your capacity to work is valuable, and so the sandwich helps maintain your value, the same way that putting fuel in a car can can provide value, despite the fuel being destroyed.
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I have no doubt that your are valuable even when not working, but that is more subjective (or at least *differently* subjective) than what you were asking about ‘net worth’ and so on.
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For our war example, it is possible to lose *value* without losing *money*.
Imagine, for instance, that half of the factories were bombed, and so we have half as many things being made by those factories.
The value is in the goods the factories make (and hence, there is value in the factories for their capacity to make goods).
Bombing the factories did make society poorer (assuming we did benefit from what those factories produced).
We might have just as much money as before though. Maybe the price of those factory goods goes up, so in ‘nominal’ terms we might spend just as much on factory goods, but because the price is ‘inflated’ by the war having destroyed halfthe factories, we are getting less value in ‘real’ terms.
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