What's the difference between a Million and a Billion?
About a Billion
this post was submitted on 11 Nov 2023
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Practically a rounding error.
I have a theory about this: We group money in magnitudes of tens up to a million but then jump up from 10x to 1,000x:
1
10
100
1,000
10,000
100,000
1,000,000
1,000,000,000
That’s a huge increase but our minds like patterns so we instinctively feel that a billion must be about 10x a million and not the 1,000x it really is, thus leading to huge inaccuracies.
Much of our perception is logarithmic, which is predictable, since patterns occur from proportion of quantities. Absolute quantities are meaningless in themselves. Even ten dollars as a quantity is meaningless except through prior experience understanding the value of a single dollar. Every value except the smallest is tenfold greater than some other value of at least some consequence.
I don't really understand your initial assumption. What if someone has 10 million dollars? Would you say he has 0.01 billion?
I think that your theory has some merit, but I believe it's more apparent when we describe the people who own the money, as opposed to the money itself: A millionaire will stay a (multi)millionaire until they become a billionaire.
I think the idea is that we still think of someone who has >1 million but <1 billion as having some number of millions of dollars, rather than subdividing "millions" into "millions," "tens of millions," and "hundreds of millions." Of course we do subdivide that when we're being particular about how incredibly rich some actor is or something, but generally they all fall on the same order of magnitude in our minds.
Its so crazy our highest tax bracket is at low 6 figures when we have people at 10 figures.
why is it in brackets why not just a percentage
Percentages don't scale well into the billions, you will still need brackets.
A billionaire can give away 98% of their wealth and still comfortably be a multi millionare.
A full time cashier on the minimum wage can barely even survive on 100% of their wage. When it comes to living a healthy fulfilling life, If they contribute just 5% of their wage to tax they are sacrificing far more a billionaire paying 98% tax would be.
well then there should be a continuous way to make the percentage increase, like a sigmoid or so
because then paupers would pay the same rate as billionaires. At the same time brackets make sure eveyone pays the same for the set amount. So even if more brackets were introduced billionaires would pay the same rate on their first 100k as millionaires. People of wealth only pay higher on the actualy high level. Whats crazy is we have several brackets that basically run through the 5 figure range and just into the 6 but none higher were 5 figures should just have one lowest rate.
It usually is a percentage, just set in brackets.
It's a percentage that nominally increases as wealth goes up.
Poor people need to spend a higher percentage of their income meeting basic needs, so having them pay the same percentage as the wealthy puts a higher burden on the poor.
In top of that, the wealthy are able to put a higher percentage of their income in things like investments, which are taxed at a lower rate (to encourage investing in the economy over hoarding wealth), so a flat rate tax would be effectively a regressive tax.
I vote we implement Pinata Economics
No no, you vote by implementing Pinata Economics.
The problem is investments vs income. It's not a super straightforward problem to solve. Having said that other countries have implemented a wealth tax, so it can be done
I don't see why there is any difference between taxing income from work and investment.
People don't have a strong intuitive sense of how much bigger one thousand is than one.
One second is one second.
One thousand seconds is like 15 minutes idk it's not very intuitive.
Anyway, it's about a thousand times bigger.
Hope this helps.
I should find some better hobbies.
I like to think of $1 billion in terms of how much money you need to spend. Let's say you're given $1 billion at birth, never earn another cent in your life, and live for exactly 75 years. To spend all of that money, you'd need to spend $36,500 per day, every day, for your entire life. Even then, you'd have nearly a million dollars left to pass down to your children.
If you only spent 36,500 a day, you'd probably die far far richer (like, 10s of billions) than you were born assuming you have it invested. You could spend more like 100k a day (adjusting up for inflation) and you'd probably almost certainly die a billionaire.
that's exactly why I have to add that you never earn another cent. The easiest way to spend money is to increase personal wealth.
Billionaires never earn their wealth. Doesn't stop them from accumulating it anyways.
What's funny is millionaires arguing against tax increases on the right when they are much closer to the pleb than they are from the billionaires that are the ones who would really pay the price.
I had a dream this week that I won 2 billions somehow in a lottery. I had so many headaches thinking about all the friends etc.. and how to give the millions away to all of them and family. And these guys are storing them like a dragon and it's gold.
TIL I’m 1 billion seconds old
If second were money, I'd be worth a hell of a lot more than a billion. And I'd be richer than a lot of tech bros.
If you had invested your time at the gray men but you didn't
At a modest average annual dividend yield of 4%, $1 million in investments will generate $40,000 in income. $1 billion will generate $40,000,000.
For real. Once you are a billionaire, with even the most basic investments, you have to try REAL hard to become broke again. Spare money begets money. Spare dragon hoards begets dragon hoards. Any bitch baby billionaire whining about taxes can kiss every single asshole of single working parents, people struggling to cover student loan debts, people who perpetually rent because they can't afford a home with a lower mortgage payment than there rent is, and every person who got ill and lost there job and home as a result. They don't need more dragon hoards. They'll be just fine.
Hot damn that is a good way to contextualize it.
A bank account with one million dollars can be completely wiped at any time. This could happen by American healthcare cost due to illness or an accident, or a lawsuit from something like a handyman slipping on your property. A billion dollars wouldn't even feel it.
By some measures, Musk's decisions managing Twitter/X should earn him one million lifetimes of homelessness.
I know no one personally who would remain secure after losing billions of dollars, yet I keep hearing that owners take all the risks and workers are always protected from hardship.
With all the layoffs we see, that is fucking bullshit. The workers get shafted even when they are doing a good job because of dumb fucks c-suite gambling the company on bullshit technology, or simple cutting costs for the shareholders.
One million years ago some of our more advanced ancestors walked the earth
One billion years ago multicellular life having evolved yet is debated
Eating the rich aside, a more familiar analogy is with data: 1 MB (a million bytes) can store a low-res photo at best, 1 GB (a billion bytes) can store a couple minutes of 4K video, 1 TB (a trillion bytes) can store an entire movie anthology.
What blows my mind is is that astronomers work with numbers incomprehensible to the human mind every day. Of course, they can calculate them, but to comprehend what a trip to our nearest galaxy would be like? Pretty damn difficult. What it would be like to travel from one end of the known universe to the other? Our fragile minds just can't take in numbers of that magnitude.
I think people can't really comprehend this because a long time ago a million was a lot of money. Like, if you had a million in your bank account you were a rich person. Nowadays that means you are just an average person with a little extra money. Heck, in places like San Francisco having a million means you are just scraping by.
That's... not accurate. The average American family has $62.5k in total across savings, checking, prepaid cards, money market accounts and call deposit accounts. That's more than an order of magnitude under $1 million. Those households with $1 million dollars in assets (which also includes investments and homes/property) are in the 87th percentile. At $2 million in assets, they're already in the 95th percentile. You're not wrong that a million dollar net worth is not what it used to be, buy it is still far far far above average.
The bay area/San Francisco does require an inordinate amount of money to be financially comfortable, but that is an outlier, not the norm. Even other major metropolitan areas like Houston don't require even half as much money for the same financial comfort. In non-urban areas a million dollar net worth would make you among the wealthiest in the area. The context of the environment, house prices and local cost of living play a major factor in one's relative wealth in a given area. The inequality of those factors in different parts of the country is as great as the wealth inequality in America in general.
People think of a billion as 10-100x more than a million. It's one thousand million.
10^9 = 10^6 * 10^3
I like math^^
I like to think it like this: a million is a decent vacation. A billion is a generation.
Dude,.. it's a bit more paradox than usual, BUT I take it!
millions = lifetime human income
billions = massive company (top 5,000)
trillions = large government (top 20)
- Read "gov spends millions" as "they employed 3 to 30 people"
- Read "company is fined 1 million" as "the had to hire 2 lawyers instead of 1"
- Read "company is fined 100 million" as "paying ~100 employees for ~10 years"
It's much like trying to imagine the mass of the sun having only known the earth, or the vastness of space having only known the solar system.