Tuesday, September 21, 2010

If Money Expired & people had choice

Money doesn't expires. Its value may decrease over time because of inflation, but it will still work. It may grow if you keep it in bank. But what if money expired...

1) Don't save. Its value will become zero eventually.
2) The only way to survive is by working, by being of value to others.
3) Don't cheat people to extract more money from them. Unless you can use it immediately, having more money doesn't makes you any richer as it will expire.
4) No point in robbing a bank...can't use all the money before it expires

We have two economies working in parallel. The economy of people working, creating value and making life easier on the planet. The second economy is the economy of speculation.  This is what I think causes economic depressions.  I think money is a great invention, but it has its own limitations. Money was intended as a tool to make people help each other now, with belief that they will be helped in future. It is a sane way to make the world exist. 

I believe that money should only do two things:
1) Allow you to use it and expire if you don't use it
2) Allow you to invest and be always at the risk of loosing it. (Loan is not investment)

The third thing is choice. People should always have a choice and more importantly the frequency of choice across all things should be in the same order.  How often can you re-negotiate your salary or your home loan? How often can you change price for your stocks?  In business model terms, it is called install base profit. This happens because people don't have a choice after they make a choice. What if you could buy a car and give it back the next day paying the usage charges? What happens if you could simultaneously work for two/three companies and decide to work each day which company you will work for based on how much money they are giving that day?  The frequency of choice creates great efficiency in the system. What if you could change your vote any day?  Choice makes the demand/supply model work. That is why 5Kg sugar costs less per KG than 1Kg of sugar because what you are trading is your choice. People should have choice and they should be able to exercise it with similar frequency across everything they buy. It is stupid to have stock markets change at millisecond basis, but your home loan fixed for 20 years and your vote for 5 years.

I don't know how to conclude this now.  Capitalism and socialism are not the only options. I think we can make world a better place. We need to push money down at the place it really belongs and bring people up - the place they really belong.


  1. The way inflation is going up, stocked money is indeed losing value fast, and therefore we are actually heading towards the situation.

  2. That is kind of part one and also it is same for everyone not relative. Money should expire faster when you have more money relatively to others who have less because ow you will continue to have relatively same purchasing power you earlier had. The part 2 is about frequency of choice and that can be solved by either companies implementing new business models or by government regulations.