Great exploration of what money is and what it requires to remain viable. The piece covers such topics as:
- The original philosophical difference
- Does money need political backing?
- Money as a common good
- Money as an information system
- Differentiating between money and credit
- The costs of money
- The external price for money—or the exchange rate
- Money in a non-democratic society
- The gold standard
From Aristotle v. Plato to Keynes, Marx and even Jesus Christ, they all had much to say about money. What does it mean in our modern society? See the whole piece here entitled: Blind Men Looking At Money
Much thanks to David Hay of Evergreen Capital Management for all the great work he and his team do to put out great financial information every week. Find their archives here: Evergreen’s Virtual Advisor and you can subscribe to their weekly updates here:
Extra Credit: THE LIQUIDATION OF GOVERNMENT DEBT* through financial repression; co-authored by Carmen M. Reinhart, who also co-authored “This Time Is Different: Eight Centuries of Financial Folly”
*Or how to wipe out government debt without having to pay it off in real dollars.
3 thoughts on “What is Money? There’s more to it than meets the eye. From GK Research via David Hay over at Evergreen Capital Mgt.”
For the exec sum of ‘THE LIQUIDATION OF GOVERNMENT DEBT’ See the Bloomberg article ‘Financial Repression Has Come Back to Stay: Carmen M. Reinhart’ here: http://bloom.bg/zf63IH
Extra, EXTRA credit: An Economist conversation with Ray Dalio of Bridgewater Associates on the economy, finance and politics from Oct 2011. You don’t have to agree but you will be doing yourself a disservice if you don’t at least consider how to handle the issues Ray brings up. http://bcove.me/1sgt07tt
THE purpose of all financial systems is to match savers who crave safety with investors who take risk. When savers discover the assets they thought were safe are in fact risky, crisis ensues. We all know what happened when the instruments meant to disperse American mortgage risk broke down. The most acute phase of Europe’s sovereign-debt crisis can be traced to the insistence of politicians at Germany’s behest that private-sector investors would henceforth have to take losses on the debt of any bailed-out country, not just Greece.
The flight from the assets formerly known as safe is only one side of the coin; the other side is what happens to those remaining assets still deemed safe.
The feeling of safety, once lost, is not easily recaptured. See the whole Economist Article here: http://econ.st/yZr7VX