David Korten: The Illusion of Money

[marmar]

from YES! Magazine:



The Illusion of Money
Real wealth or phantom assets? David Korten explores the difference between the kind of wealth that makes life better and the phantom wealth created by financial speculation.

by David Korten
posted Jan 18, 2011


In business school, we were taught to assess investment options to maximize financial return. I don’t recall that the professor ever mentioned that this meant maximizing returns to people who have money—to make rich people richer. Or that money is a system of power and that the more our lives depend on money, the greater our subservience to those who control the creation and allocation of money.

Nor do I recall asking my professors, “What is money?” “Why do we assume that maximizing financial return maximizes the creation of real value?” “How does the conversion of natural living wealth to financial wealth create real value?” “What about the many fortunes built through financial speculation, fraud, government subsidies, the sale of harmful products, and the abuse of monopoly power?” I may have had some doubts, but kept them to myself for fear of being dismissed as hopelessly stupid.

Perhaps those who taught us economics, finance, and accounting did not themselves recognize the difference between real living wealth and phantom financial wealth.

Real wealth has intrinsic value. Examples include fertile land, healthful food, knowledge, productive labor, pure water and clean air, labor, and physical infrastructure. The most important forms of real wealth are beyond price and are unavailable for market purchase. These include healthy, happy children, loving families, caring communities, a beautiful, healthy, natural environment. .............(more)

The complete piece is at: http://www.yesmagazine.org/blogs/david-korten/the-illusion-of-money

[Odin2005]

1. The Finance "Industry" creates nothing and contributes nothing to society.

They are vile parasites.

[bigmonkey]

2. The first week of an economics education is the seed of destruction.

That's where the questions like "What is money?" and "What is happiness?" are faux-answered, mainly by assertion protected by sarcasm and confrontation. Once you concede the basis, it becomes progressively harder to question the conclusions drawn. You would be criticizing the very basis of the whole enterprise, and that's "rude". Persistent questioning of the basis of economics (not the math) leads to suggestions that you quit the field.

[Festivito]

3. I believe the ONLY thing we have is trust.

Own a car?
You trust the paper says so.
You trust the policeman respects the paper.
You trust the citizens respect the policeman.
You trust the government respects the citizenry.

Otherwise, you own... not a thing.