“Dad, is money a good thing?”

Let’s start with understand what money is. Money is what we use to trade things between people. I make something, you make something else, we trade. Money is a very efficient way to trade value.

So Money is a good thing?

it is a VERY good thing. If you have it, it means that you’ve created something valuable than many other people want and are willing to pay for.

money-in-hand

Who makes money?

that’s a very good questions kid.

Today governments print money according to the sum of value in the market. But they use it for other things as well which are not so good and that creates something that is called inflation – meaning every dollar can buy less than before. The way it should work is that we have money printed at the exact sum of values – in the old days they used to print money according to the amount of gold they had in the bank. Gold is a special metal because it is limited and people perceive it as valuable.

If you study economics (the right kind of economics) you’ll better understand the processes around money, inflation and other important things.

Do we have a lot of money?

Ha. We have enough.

The most important thing is that I am proud of the way I make money and support you and our family.

I love you Dad.

I love you too kid.


2 Comments on ““Dad, is money a good thing?””

  1. Rafael says:

    “it is a VERY good thing. If you have it, it means that you’ve created something valuable than many other people want and are willing to pay for.”

    Does wall street creates value? Does that suits reality? Your skyscraper of knowledge is in danger buddy.

    • Hi Rafael,
      Yes, Wall Street’s job is allocate funds to businesses and enable growth. It is what the banks in the old days before government took over the economy were doing. So there is no wonder why there are so many Venture Capital firms stepping in while banks are busy dealing with government regulations.
      I would like to better understand the contradiction you are referring to.
      thanks for replying.


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