My Two Cents: The Financial System Laid Bare

A Pocket Guide To Modern Economics

There’s a reason financial cons are everywhere. Because they’re easy. I think it’s because money intimidates people. Their eyes glaze over when they hear the words ‘interest rates.’ Like yours probably did when you read “Modern Monetary Theory.” And it’s made intentionally more complicated by those people whose job it is to convince others that finances are not to be self-managed — that our financial system is so complicated that only they can understand it.

As long as the market is in the green, there’s no reason to challenge the status quo. If it works, don’t fix it. Trillions of dollars in government QE measures? Fine. $12.5 trillion in negative interest rates? I mean, the S&P 500 is at an all-time high…As long as those little green market arrows keep pointing up, then it’s smiley faces all around. “We’re making you money; don’t ask questions.”

That’s why understanding our financial system is important. So we can decide what’s normal for ourselves. So that we don’t succumb to, as Milton Friedman termed it, the “Tyranny of the Status Quo.” By understanding how money works, we free ourselves to make our own informed conclusions. We enable ourselves to make safer and wiser investments, decisions that anticipate the evolving nature of money. So we can decide…