In order to accumulate resources, one must use the resources available wisely, consuming just a portion and investing the rest to produce more resources.
Individuals and societies that don't do this grow poorer.
But your investment returns are someone else's uninvested consumption. Aggregate demand is like a field of crops, and our society seems to have chosen to eat its seed corn.
Not all returns are someone else's consumption. If that were the case, there would be no industry.
You can invest in a business that makes things for businesses or things that are actually investments for consumers.
An education is not (usually) consumption for a consumer. Neither is a car that more than pays for itself with the time it saves. Using the same car to go traveling around the country instead of getting an education is more consumption than investment.
Our society has chosen to water down the natural incentives to make prudent investments. Saving money no longer pays meaningful interest. The government gives you large incentives to buy a much bigger house than you might otherwise buy or rent. That "extra" house is consumption.
Not all returns are someone else's consumption. If that were the case, there would be no industry.
It is a good approximation of reality, created by the fact that people have varying preferences for consumption versus investment.
An education is not (usually) consumption for a consumer. Neither is a car that more than pays for itself with the time it saves.
In neither of these cases does the provider of the car or education receive monetary returns for the car or education beyond the actual price. When I said "investment", I should perhaps have specified capital gains: interest, dividends, or asset appreciation that return monetized value to the investor.
So an education is metaphorically investment for the student, but not for the university. Even for the student, there is no asset owned that can be sold and no legal contract of debt or equity that "their education" has to pay for. There's just a hope of a better-paying job. Hence, "metaphorically" an investment.
Our society has chosen to water down the natural incentives to make prudent investments.
Well no. Our society is struggling to keep its head far-enough above water to avoid a deflationary spiral.
The maker of the car does receive a return. Its the price paid for minus all the costs of being in the car business.
A return is not guaranteed, of course. But if there were no return possible, no one would go into the car business.
You say for student there is no asset that can be sold. Not true, at least when the student chooses his education wisely. He can now sell his time for more money. Education is a "factor of production" of his work, which he then can sell.
When I first spoke about investment, I did not mean the narrow meaning you've understood. I was talking about why people are poor and I discussed consuming resources versus using them to produce more resources.
Investing in one's own capabilities or making your own garden are investments that don't involve giving money to someone else and waiting for a return. Successful businesses and successful people make such investments.
When I first spoke about investment, I did not mean the narrow meaning you've understood. I was talking about why people are poor and I discussed consuming resources versus using them to produce more resources.
Ok, but in that case, most poor people simply don't have much to invest in themselves. Most of their efforts are consumed each day in just getting a living (by implication: most people are poor).
That's not true. We were all poor once. Yet here we are. I grew up poor myself.
Where people are not free, where the government or thieves take their resources, they cannot accumulate anything. And in countries that are still largely poor, that is exactly what happens.
But, when people are able to escape these countries to where they can be free, they are then free to improve their situation. And many do.
Individuals and societies that don't do this grow poorer.