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timtyler comments on Abnormal Cryonics - Less Wrong
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Most people already have a reason to care about the future - since it contains their relatives and descendants - and those are among the things that they say they care about.
If you are totally sterile - and have no living relatives - cryonics might seem like a reasonable way of perpetuating your essence - but for most others, there are more conventional options.
This is plain wrong. Most of these rates is inflation premium (premium for inflation you need to pay is higher than actual inflation because you also bear entire risk if inflation gets higher than predicted, and it cannot really get lower than predicted - it's not normally distributed).
Inflation-adjusted US treasury bonds have rates like 1.68% a year over last 12 years., and never really got much higher than 3%.
For most interest rates like the UK ones you quote there's non-negligible currency exchange risk and default risk in addition to all that.
taw:
Not to mention that even these figures are suspect. There is no single obvious or objectively correct way to calculate the numbers for inflation-adjustment, and the methods actually used are by no means clear, transparent, and free from political pressures. Ultimately, over a longer period of time, these numbers have little to no coherent meaning in any case.
It seems low but it's correct. Risk-free interests rate are very very low.
Individual stocks carry very high risk, so this is nowhere near correct calculation.
And even if you want to invest in S&P index - notice the date - 2007. This is a typical survivorship bias article from that time. In many countries stock markets crashed hard, and failed to rise for decades. Not just tiny countries, huge economies like Japan too. And by 2010 the same is true about United States too (and it would be ever worse if it wasn't for de facto massive taxpayers subsidies)
Here's Wikipedia:
This wasn't true back in 2007.
This is all survivorship bias and nothing more, many other stock exchanges crashed completely or had much lower returns like Japanese.
And I should add that markets are wickedly anti-inductive. With all the people being prodded into the stock market by tax policies and "finance gurus" ... yeah, the risk is being underpriced.
Also, there needs to be a big shift, probably involving a crisis, before risk-free rates actually make up for taxation, inflation, and sovereign risk. After that happens, I'll be confident the return on capital will be reasonable again.
Levels of concern about the future vary between individuals - whereas interest rates are a property of society. Surely these things are not connected!
High interest rates do not reflect a lack of concern about the future. They just illustrate how much money your government is printing. Provided you don't invest in that currency, that matters rather little.
I agree that cryonics would make people care about the future more. Though IMO most of the problems with lack of planning are more to do with the shortcomings of modern political systems than they are to do with voters not caring about the future.
The problem with cryonics is the cost. You might care more, but you can influence less - because you no longer have the cryonics money. If you can't think of any more worthwhile things to spend your money on, go for it.
Real interest rates should be fairly constant (nominal interest rates will of course change with inflation), and reflect the price the marginal saver needs to postpone consumption, and the highest price the marginal borrower will pay to bring his forward. If everyone had very low discount rates, you wouldn't need to offer savers so much, and borrowers would consider the costs more prohibitive, so rates would fall.
They're nothing of the kind. See this. Inflation-adjusted as-risk-free-as-it-gets rates vary between 0.2%/year to 3.4%/year.
This isn't about discount rates, it's about supply and demand of investment money, and financial sector essentially erases any connection with people's discount rates.
Point taken; I concede the point. Evidently saving/borrowing rates are sticky, or low enough to be not relevant.
Perhaps decide to use gold, then. Your society's interest rate then becomes irrelevant to you - and you are free to care about the future as much - or as little - as you like.
Interest rates just do not reflect people's level of concern about the future. Your money might be worth a lot less in 50 years - but the same is not necessarily true of your investments. So - despite all the discussion of interest rates - the topic is an irrelevant digression, apparently introduced through fallacious reasoning.