The life of a dollar

Lately, I've heard a lot of "zero sum" talk about the economy. One person even said that the rich people are selfishly hoarding all the money so that there isn't any left for the rest of us. I just want to clear something up: money is not a limited resource, it is a transactional resource. How much is a dollar worth?

That's a stupid question, a dollar is worth a dollar right? What about the physical paper; what is that worth? It depends on how many times it changes hands. Each time a dollar passes from one person to the next, value is created on both sides. There is a trade. The purchaser is gaining a product or service while the seller is gaining money.

There is worth on both sides of the transaction. In each transaction, a dollar retains its value while leaving value behind. The more transactions there are, the more money there is in that society. It is not a limited resource.

A small example will help illustrate this. A man has $1,000 and pays a contractor to improve his bathroom. The contractor now has money and pays a plumber and a finish carpenter to do the work, then keeps some for himself. The value of the man's home increases with the improvements on his bathroom. The plumber buys a TV. The TV store uses the money to pay employees. The carpenter pays his rent. The carpenter's landlord uses the rent money to save for his son's college tuition. The contractor pays someone to mow his lawn... and so on and so on.

Each transaction, each time money changes hands, value is created. The more transactions there are, the more value our money has. Or in other words, the more value people add to other people's lives, the wealthier we all are. If each of us strive to bring the best value (read: products and services) to everyone else, the better we all are.

Blame: a powerless position

Pointing the finger of blame automatically removes any power you may have had to improve your situation. Consider this, placing blame on others is a lot more about ditching personal responsibility, than it is about giving credit where credit is due. If you avoid blaming others, then you allow yourself to keep some power to make changes. If something or someone is negatively impacting your life, you have the power to do something about it right up until the point that you blame them for causing your problems.

[EXPAND Read More]For example, there is a difference between someone who says, "Sally is driving me crazy," and someone who says, "My choice to continue to associate with Sally is driving me crazy."

The first statement has no power. Sally will most likely continue to cause problems and there's nothing that will change that. The second statement not only retains power and doesn't place blame, it also hints at a possible solution.

If you assume that you can't change others (a very safe assumption), then the only option for change is to change your own thoughts and behaviors. The second statement lands the responsibility of Sally driving me crazy straight on my shoulders. Sally is Sally. She will, likely, continue to do what ever it is that drives me crazy. I have two choices, I can remove Sally from my life, or choose to think differently about her actions.

Taking personal responsibility about the effect other people have on us seems counter intuitive, but it is the only thought process in which you can do anything. Its the difference between, "He made me mad," and "He is an idiot and I chose to be mad about it."[/EXPAND]

 

What is debt?

An interview with David Graeber, an economic anthropologist about the roots of debt in human history.The interesting thing is that historically debt is inversely related to freedom and spirituality.

"The Aramaic word hoba is used regularly for both debt and sin, and that’s the origin of the usage in the Lord’s Prayer"

"In fact, the first recorded word for ‘freedom’ in any human language is the Sumerian amargi, a word for debt-freedom, and by extension freedom more generally"

But, he goes on to say that debt isn't always evil, "...in many communities it’s considered only right that everyone should owe everybody else at least a little, because that’s the essence of sociability..."

I'm very outspoken against personal financial debt. I think it should be avoided in almost every situation. On the other hand, social debt or the trading of obligations, is the basis of a good friendship. You invite someone over for dinner, then they invite you and so on.

In any case, it's an interesting read.

http://www.nakedcapitalism.com/2011/08/what-is-debt-–-an-interview-with-economic-anthropologist-david-graeber.html