The Real 'Goldilocks Economy,' Part III
A mountain of money in the hands of a miser produces zero utility/societal benefit of any kind, and more than four uninterrupted decades of those hoards swelling larger and larger now provides the empirical evidence to prove Plutarch's principle, as our debt-saturated economies are now all hollowed out to the point of collapse. Having seen the permanent economic malaise produced by turning the Middle class into the working poor, it's time to turn back the clock -- and to explain why it was also no coincidence that at the same time that the Middle class reached its peak in terms of both size and affluence, our economies also reached their all-time peak of prosperity.
It's obvious to anyone (except everyone in the mainstream media, and their "experts") why it's an unmitigated evil to have too much wealth in the hands of the wealthy, since the economy becomes "too cold," shrivels and dies. However, what is not intuitively obvious is why the opposite is also not desirable: economies that overheat and become "too hot."
Just as the very wealthy tend to hoard the vast majority of every dollar they receive, the poor tend to do the opposite: They spend their money as fast as they receive it since (by definition) they have barely enough to survive. What are the perils of an economy that overheats? Even the drones of the mainstream media can answer that question: bubbles. While an asset bubble is the most extreme manifestation of an overheated economy, generally speaking any time an economy overheats, it implies (at best) high inflation, as those dollars flooding into our economies "compete" with each other for goods and services -- with such competition inevitably resulting in higher prices.
Thus, what is "just right" for any/every economy is to maximize the percentage of wealth in the hands of the Middle class, since this wealth bracket automatically demonstrates the ideal balance between savings and consumption. They don't hoard too much (like the greedy misers) and they don't spend too much (like the impoverished poor). Economies have enough fuel to generate sufficient revenues to maintain services without deficits, without overheating and producing unhealthy imbalances -- which result in asset bubbles, and (more broadly) ever-worsening boom/bust cycles.