Transcripts
The Hidden Cost of Money:
Speaker:How Financial Forces Shape Our Lives & the World Around Us Written by
Speaker:Sebastian Bunney, narrated by russell newton.
Speaker:Chapter 1 .- A Brief History of Money .- How Intervention Has Shaped The Money
Speaker:We Use.
Speaker:“It ain’t what you don’t know that gets you into trouble.
Speaker:It’s what you know for sure that just ain’t so."
Speaker:—Mark Twain.
Speaker:Consider David,
Speaker:a passionate individual who consistently directs his savings toward acquiring
Speaker:outdoor gear,
Speaker:such as camping equipment.
Speaker:The farmer whose livelihood is transformed by an unprecedented surge in demand
Speaker:for ethically sourced,
Speaker:locally produced,
Speaker:grass-fed beef.
Speaker:A boycott where conscientious consumers unite in their refusal to support
Speaker:manufacturers that disregard ethical practices.
Speaker:Or a nation whose economy plummets due to a global rejection of natural
Speaker:resources extracted under inhumane conditions.
Speaker:In each of these scenarios,
Speaker:what valuable insights can we gain from analyzing the money flow,
Speaker:or lack thereof?
Speaker:By monitoring the movement of money,
Speaker:be it on an individual or macroeconomic level,
Speaker:we can uncover profound insights into the underlying values driving personal
Speaker:expenditure or,
Speaker:in a broader context,
Speaker:our shared societal values.
Speaker:Take,
Speaker:for example,
Speaker:David's spending habits which reveal his deep appreciation for nature and the
Speaker:outdoors.
Speaker:Similarly,
Speaker:the surging demand for grass-fed beef not only reflects changing dietary
Speaker:preferences but also underscores the growing significance of ethical,
Speaker:locally sourced products.
Speaker:However,
Speaker:this revelation comes with a crucial caveat - only under specific monetary
Speaker:conditions can money truly serve as an authentic reflection of who we are,
Speaker:our unwavering priorities,
Speaker:and the very essence of what we hold dear.
Speaker:When it comes to romantic relationships,
Speaker:no matter how much time or effort we invest,
Speaker:without establishing effective lines of communication,
Speaker:our understanding of our partner's needs becomes distorted,
Speaker:and vice versa.
Speaker:This breakdown in comprehension ultimately dooms the connection,
Speaker:as we lack the capacity to discern the necessary steps for progress.
Speaker:That said,
Speaker:just as how a breakdown in communication can spell the end of a relationship,
Speaker:numerous societal challenges arise when an ineffective monetary system impedes
Speaker:our ability to convey our needs and values.
Speaker:Open lines of monetary communication mean we can allocate our capital according
Speaker:to our beliefs.
Speaker:When declining purchasing power,
Speaker:capital controls,
Speaker:spending limits,
Speaker:or purchasing restrictions hinder our capacity to direct capital where we see
Speaker:fit,
Speaker:money's ability to mirror our societal values begins to erode.
Speaker:Under such circumstances,
Speaker:our capacity to express ourselves monetarily becomes inhibited,
Speaker:suppressing the truth.
Speaker:Consequently,
Speaker:the economy experiences cascading effects,
Speaker:including loss of authenticity,
Speaker:wealth inequality,
Speaker:needless consumption,
Speaker:and environmental degradation,
Speaker:among others.
Speaker:Much like how emotional expression is integral to emotional maturity,
Speaker:freedom of monetary expression is vital for a sustainable and functioning
Speaker:economy.
Speaker:For both relationships and societies to endure,
Speaker:let alone thrive,
Speaker:we must cultivate genuine self-expression in alignment with our beliefs.
Speaker:This allows us to perceive reality as it truly is,
Speaker:or at the very least,
Speaker:as closely aligned with reality as possible,
Speaker:aiding us in offering value.
Speaker:Remember,
Speaker:everything is downstream of money.
Speaker:If we want humanity to flourish,
Speaker:we must ensure truth and integrity underpin our money.
Speaker:With all this in mind,
Speaker:let's delve into the heart of our economy—our monetary system—to uncover
Speaker:how it has gone astray,
Speaker:hindering our ability to express ourselves truthfully and precisely.
Speaker:Our Monetary System Picture yourself embarking on a journey from New York's J.
Speaker:F. K. Airport to Tokyo's Narita International Airport.
Speaker:Spanning over 14 hours,
Speaker:this flight covers 10,871 kilometres.
Speaker:Now,
Speaker:imagine the pilot miscalculates his trajectory by a mere 1o during takeoff.
Speaker:Though seemingly insignificant,
Speaker:you'd discover yourself hundreds of kilometres off-course from Tokyo by the
Speaker:time you intended to arrive.
Speaker:You're now over the Sea of Japan or the Pacific Ocean,
Speaker:with dwindling fuel reserves.
Speaker:Much like we rely on faith and trust in our pilot's skills,
Speaker:flight instruments,
Speaker:and navigation systems,
Speaker:we must also bestow substantial faith and trust in the layers of our monetary
Speaker:system -
Speaker:•We place our trust in central bankers,
Speaker:hoping they possess the expertise and knowledge necessary to navigate the
Speaker:complexities of a macroeconomic environment and make decisions for the
Speaker:betterment of society.
Speaker:•We must rely on commercial banks to access our money whenever we make a
Speaker:withdrawal.
Speaker:•We place great trust in our money,
Speaker:hoping it incentivizes positive and productive behaviour.
Speaker:•We rely on the stability and continued usability of the currency we earn as
Speaker:income to fulfill our desires and meet our essential needs.
Speaker:•We must put our faith in those in positions of power,
Speaker:trusting that they have the best interests of the economy and the people at
Speaker:heart.
Speaker:Just like the pilot example above,
Speaker:in any of these situations,
Speaker:if the individuals or institutions in question were to fall short,
Speaker:the consequences could be catastrophic.
Speaker:So,
Speaker:is our monetary system and its participants deserving of the considerable trust
Speaker:we grant them?
Speaker:Let's take a closer look at the history and current state of our monetary
Speaker:system to explore whether it's truly worthy of our confidence.
Speaker:The 4 Factors of Production.
Speaker:Our economy may seem complex and overwhelming at first glance,
Speaker:with numerous moving parts and intricate systems.
Speaker:However,
Speaker:with a closer examination,
Speaker:it becomes clear that everything within our economy can be distilled into four
Speaker:key areas - land,
Speaker:labour,
Speaker:enterprise,
Speaker:and capital.
Speaker:These four areas are known as the four factors of production,
Speaker:which,
Speaker:combined,
Speaker:form the building blocks of all goods and services.
Speaker:Understanding them,
Speaker:therefore,
Speaker:is essential to understanding how our economy functions.
Speaker:Let's take a look at the four factors of production and explore how each one
Speaker:plays a crucial role in the functioning of our economy.
Speaker:Land First,
Speaker:we have the factor of land,
Speaker:which encompasses all types of land,
Speaker:including everything from agricultural land to commercial real estate.
Speaker:However,
Speaker:and more importantly,
Speaker:it includes all our natural resources,
Speaker:such as oil,
Speaker:gold,
Speaker:lumber,
Speaker:and minerals.
Speaker:Anything involving land use or requiring extraction from our natural
Speaker:environment falls under the land factor.
Speaker:Labour Second,
Speaker:there is the factor of labour,
Speaker:which is the mental and physical effort the population expends to bring goods
Speaker:or services to the market.
Speaker:This includes everyone from construction workers and restaurant staff to
Speaker:receptionists and manufacturing plant employees.
Speaker:Demographics,
Speaker:like age composition or education levels,
Speaker:greatly impact the productivity of the labour workforce.
Speaker:Capital Third,
Speaker:we have the factor of capital.
Speaker:Capital is the lifeblood of most businesses,
Speaker:providing the necessary funds to purchase equipment and infrastructure required
Speaker:to manufacture goods and provide services.
Speaker:Capital goods can include machinery,
Speaker:vehicles,
Speaker:tools,
Speaker:and other physical assets necessary to produce goods and services efficiently.
Speaker:Without capital,
Speaker:businesses struggle to survive,
Speaker:unable to meet their expenses,
Speaker:purchase materials,
Speaker:pay for production,
Speaker:or invest in the equipment needed to improve productivity and expand operations.
Speaker:As such,
Speaker:the availability and accessibility of capital play a critical role in the
Speaker:health and growth of the economy.
Speaker:Enterprise Last,
Speaker:we have the factor of enterprise or entrepreneurship,
Speaker:which utilizes the other three factors to create innovative products and
Speaker:services that generate profit and increase productivity.
Speaker:Enterprise is the catalyst that brings the factors together with purpose.
Speaker:As Luis Portes,
Speaker:a professor of economics at Montclair State University,
Speaker:explains - "Entrepreneurial activity is the engine of innovation that brings
Speaker:new ways of organizing land,
Speaker:capital and labour to produce new goods and services."
Speaker:In short,
Speaker:enterprise plays a critical role in a nation's economic growth and development.
Speaker:With an understanding of the four factors of production,
Speaker:we can start to piece together the incentives that underlie our economy.
Speaker:But... have you ever noticed that although there are four factors that make up
Speaker:our economy,
Speaker:we only ever seem to hear about one in particular.
Speaker:That is the factor of capital.
Speaker:There are far more news stories,
Speaker:such as - “Fed announces massive cash injection to relieve U. S. debt
Speaker:market.”9 “Biden,
Speaker:McCarthy reach agreement ... to raise debt ceiling as default looms.”10
Speaker:“Stimulus Checks Substantially Reduced Hardship,
Speaker:Study Shows.”11 Yet far and few between about how - "We need to have more
Speaker:children to boost labour capacity!"
Speaker:"Increase our ability to extract more natural resources."
Speaker:"Bet on technological change to fix our issues."
Speaker:If you're wondering,
Speaker:"Why does capital command this attention?"
Speaker:You're not alone!
Speaker:When times get tough,
Speaker:we can think of each of these factors as a lever that can be pulled to increase
Speaker:productivity and reduce economic stress.
Speaker:For instance,
Speaker:pulling the "land" lever can involve redirecting efforts toward obtaining more
Speaker:natural resources or improving agricultural productivity.
Speaker:However,
Speaker:this approach has several challenges,
Speaker:such as -
Speaker:•There is no guarantee that we will discover new resources or experience a
Speaker:significant increase in land productivity within the desired timeframe.
Speaker:•The process of promoting land use and increasing resource production can
Speaker:take a long time.
Speaker:For example,
Speaker:it takes roughly five years to build a new solar farm and between 1 to 10 years
Speaker:to build a gold mine.12,13 Even after completion,
Speaker:there is only a small chance it will be a productive site.
Speaker:•Regulations aimed at minimizing environmental impact have made it
Speaker:increasingly difficult to start new projects related to traditional energy
Speaker:production.
Speaker:In fact,
Speaker:some countries are even buying out farmers to meet their climate goals,
Speaker:such as the Netherlands,
Speaker:the second-largest agricultural exporter globally.14 As a result,
Speaker:pulling the "land" lever has become less effective and less profitable than it
Speaker:has been historically.
Speaker:Another option could be to direct our attention to the “labour” lever.
Speaker:By implementing austerity measures such as cutting public programs,
Speaker:raising taxes and so on,
Speaker:we could push the labour workforce to increase production by working harder and
Speaker:longer,
Speaker:all while reducing consumption,
Speaker:given their reduction in expendable income.
Speaker:The challenge is that not only are these measures politically unfavourable and
Speaker:usually avoided by politicians,
Speaker:but the general populace also doesn't tend to favour such measures,
Speaker:considering that austerity predominantly impacts the lower and middle classes
Speaker:and has an immediate negative impact on our quality of life.
Speaker:We also often overlook the demographic hurdles we currently face.
Speaker:Here are a few glaring facts that may give us some clues as to what to expect
Speaker:moving forward .- The Past.
Speaker:•The U. S. population grew by 40% between 1950 and 1960.15
Speaker:•The global population doubled between 1950 and 1987.16
Speaker:•During the 1970s,
Speaker:the Baby Boomers began supporting themselves and entering the workforce,
Speaker:creating greater demand for goods,
Speaker:services and assets due to their high numbers.
Speaker:The Future
Speaker:•The percentage of senior citizen-aged Canadians (aged 65 and over)
Speaker:will increase by around 60% between 2019 and 2036,
Speaker:compared to an increase of under 10% for the younger population.17
Speaker:•A study by the People's Bank of China revealed that "China's population
Speaker:could halve in the next 45 years."
Speaker:This has been
Speaker:The Hidden Cost of Money:
Speaker:How Financial Forces Shape Our Lives & the World Around Us Written by
Speaker:Sebastian Bunney, narrated by russell newton.
