Sunday, June 10, 2007

Freakonomies of Scale

I work with economics. Macroeconomics. Everyday.

And with macroeconomics follows the concept of ridiculously big sums of money -- like gross domestic product, trade numbers, national budgets, etc. We don't flinch for anything less than a hundred million dollars. After all, it's macroeconomics. Macro. Big picture. We look closely at equity markets and capital markets and monitor massive cash movements between countries that may move the foreign exchange market -- which eventually affects currency. Big numbers. Very big numbers that even I couldn't physically fathom. All these are mere figures that I see on the screen of a Bloomberg terminal. If I have to visualize, however, how many stacks of hundreds I'd have to have in order to amass these amounts... then I would have to admit that I'd be stunted.

Money. That one thing that makes the world move. If not for money, then I wouldn't have a job. Neither will millions of people out there -- some of whom hold the most powerful jobs in the world. The world's various nations would be trading herds of cattle and sacks of rice instead. How exactly do you measure the inflation of sheep? Do you judge a country's wealth by how many chickens there are in the people's backyard?

If it weren't for present-day currency, however, people would have found another way to measure one's success or achievements. It is only human nature to aspire for material wealth as part of survival. Though money is not the root of evil, it can be an instrument of it. People react to money differently. And also, many people change because of it.

Here's a borderline-idiotic question: Why is money so important? However, here's a spin-off from that question: What is it about money that changes us?

Money changes people - either for the better or the worse.

We all work to rake in enough dough to survive. Yay or nay? Getting in a decent sum in our bank accounts grants us the basic requirements to live and perhaps allows us the luxury to enjoy the finer things in life. We progress and we move forward. That's what success and achievements are about. However, moving forward does not mean we have to forget where we came from. We do not let such a physical concept like money get in our heads and allow it to rule us over.

I have met people who did one-eighty-degree turns because of money. Friends, even. I have noticed some morph into some sort of being that I could no longer recognize. And all because of money. It doesn't make me upset, though. It makes me sad. It makes me sad that I had lost some friends to dead national icons whose faces are imprinted on a piece of paper.

I laud these kinds of people for working hard for money. From humble beginnings to exuberant standings -- and admittedly, I have once thought that they deserve nothing less. However, witnessing Kafka-like metamorphoses makes me think otherwise. The notion of having fat wads of bills in one's pocket gives people confidence - enough of it that eventually turns into arrogance and deceit. Into extreme materialism, into shallowness, into tastelessness (ironic enough), and pettiness. Why is that? What is it about money that makes people so powerless against it?

As P.T. Barnum once put it: "Money is in some respects life's fire: it is a very excellent servant, but a terrible master."

Do you ever question why no matter how much we pray to get rich, we never get it? No matter how hard we work, no matter how much dexterity there is in our souls, we don't quite get what we want? However, we will always have just enough. God perhaps wants to control these metamorphoses in the world. Maybe the Creator knows too well what will happen if everyone had money. We become aware of crimes and atrocities that take place because of money presently. We never know -- maybe that's a small price to pay for having only a handful of people in this world to have money.

If everyone's rich, I very much doubt it will be a happy world. How else can people learn to share or learn to work hard? What more will people work for that is tangible and measurable by success? Will people become more lazy or too complacent? Or will people find something else to turn to that will change them for the worse? Will people honestly pay attention to non-monetary values given the trickiness of human nature? Think about it, knowing how human nature works, people will probably find ways to get even richer than they already are. And we will all be back to ground zero... just with higher inflation numbers.


Blogger nel said...

Nice thoughts again, but money does not make people evil, it is people themself that manifest the things they make to be evil or good. Just like the discovering of nuclear energy by Albert Einstein.

Here is another quote:

There is enough in the world for everyone's need, but not enough for everyone's greed - Mahatma Gandhi.

... that lies the problem. Am I the first poster ... hah, hah ... :)

8:19 PM  
Blogger nel said...

By the way, Freakonomies is a book title, right? I would recommend another title for you if you are interested -- Wikinomics - How Mass Colloboration Changes Everthing by Don Tapscott and Anthony D. Williams, and Small Giants - Companies That Choose to Be Great Instead of Big by Bo Buringham. Don't ask me how is the books, I have a habit of buying them and not reading them. It's a bad habit of mine ... :p

8:32 PM  
Blogger it's the little things... said...

I am utterly surrounded by friends who have made it big (and some HUGE), while I have struggled along choosing to be an involved single parent over a career woman.

While friends call to talk about which grade of leather to upholster their new couches with to fit in their new homes, the running thought commentary in the back of my mind is how will I fix dinner tonite for $4.37?

Removing the judgement that either position is good or bad... I always marvel at the differences in each of our lives due to the abundance or lack of money.

Personally, I am by far the happiest person I know.

And that is a FACT.

9:03 PM  
Blogger Superficial Gibbering prater said...

i laud ur writing small difference in opinion about money changing people's character,that is total misconception.

Everyone is good ,till they get an opportunity to be otherwise.

so money is not the evil here.
(wo)man fights for survival ,first it was food(hunting),then it was shelter and protection(civilisations),now it is money and tomorrow it could be anything....The ro(o)t of the tree is not in it's branches.

9:19 PM  
Blogger Jennifer McK said...

I think if I was suddenly rich, I wouldn't have the appreciation of the small stuff that makes life so beautiful. I'd like to believe I'd still want to walk on the beach, go camping with cheap hot dogs and bologna, and go to the park, but with lots of money, I think I wouldn't.
I don't pray for riches. Sometimes the struggle of "making ends meet" can be wonderful.
And sometimes not.
My creator has always given me just enough--no more no less. Thank God.
Great post, Princess.

9:45 PM  
Blogger David Anthony said...

Tony Blair once thought that he could measure the level of poverty in a home by the amount of books that they owned. I'm pretty sure he later backtracked on this.

Poverty is society specific, children living 'in poverty' in the UK all own mobile phones and games consoles, children living in poverty in Africa struggle to find food every day.

Tony Blair also says that he wants to eradicate child poverty in the UK by 2020, this is impossible. Capitalism relies on a large mass at the bottom and a select few at the top. All we can do is hope to shift the level at which 'poverty' is measured upwards towards higher and better standards.

10:17 PM  
Anonymous Anonymous said...

...Money~People lie, cheat, steal and kill for they do that for anything else? Most likely not. So *IS* money then therefore evil? It makes people behave in evil ways.....Good post!!

10:38 PM  
Blogger Shrink Wrapped Scream said...

If we were all rich, it would be meaningless anyway, wouldn't it? No-one would "work", economies would collapse, and we'd end up back in the cave-age. Money is a barter system - an unfair one - but the best we can come up with..

More priceless than money, is our humane value system. Families, not money, either do or do not instill this, to us, their children. Our entire future hangs on that alone.

10:55 PM  
Anonymous ruby said...

Branum's quote sums it all up very well. I think the more we have, the more our expectations and perceived needs increase. Well written!

12:24 AM  
Blogger Caught in a purple haze said...

Nice done again!

Money makes the world move, or perhaps not?

Btw, I`m blog-rolling you.

12:49 AM  
Blogger Tea & Margaritas in My Garden said...

Yes, sadly we all want and need money and it does seem that it can be the root to all evil as well as being the root to doing good. Just wish I had it to choose! :)


1:17 AM  
Blogger Crushed by Ingsoc said...

'The Love of Money is the Root of All Evil'

And we're surprised that a society whose chief ethic is the profit motive is so screwed up?

1:37 AM  
Anonymous Anonymous said...

Banter queen (I promoted you), your blog is keen. i would visit it regularly. Do i blogroll you ?

BTW i follow cricket and i have other blogs too. Do visit them. I have a story writing series too going on, just like yours (first love).

Have fun!!!

2:20 AM  
Blogger StandbyMind said...

Very well put...
You actually work at things we hear all day ..inflows..gdp stuff..
and in between all this u have realized and shared the big truth of this life...The truth of humans...
Loved reading it!

3:29 AM  
Blogger Sudipta Chatterjee said...

Wonderful read!

And yes... money in itself doesn't corrupt. But one needs to be mentally prepared for it. Otherwise it too just goes into the head

5:41 AM  
Blogger nasia said...

:-)The true winners are those who survive the spell of money. And we still have such people in the world. I think we shud work because we love it, money jst comes along.

6:15 AM  
Blogger Inside our hands, outside our hearts said...

I am nt a numbers person. My level is mre emotional. I agree that if everyne were rich the wrld would still not be happy.
Thse that have little would disagree, but then naybe their minds would differ if they could truly see how money can destroy.

Oh life is easier with money. I have been on both ends of that stick, but life, how much sweeter it is when you appreciate it. Then if money comes your way I think one can relate better.

Maybe I am wrong, but I do not think so.

smiles.. princess, love is just around the corner.

6:25 AM  
Blogger X. Dell said...

(1) I once worked ((IT)) for the international banking division of a large corporate conglomerate. While repairing this one computer, I overheard one executive casually say over the telephone, "By the way, you were three million short in that last transaction." In the very next sentence, I heard something I never thought I would. "Don't worry," she said, "it'll turn up."

I couldn't imagine treating three mil so cavalierly. Had I misplaced that kind of money, I'd be tempted to walk off the Verazano.

(2) Had I not met extremely wealthy people in this life, I would have felt exactly the same as you post here toward money. For the most part, I agree with you very deeply as your insights apply to the vast majority of us (including myself). Yet, I know that some look at money very differently.

An acquaintane of mine was laboring on the phone for some deal that was supposed to net him $42 mil--a fraction of his net worth. When he put down his phone after stressing about this transaction, I asked him what the worry was. He wouldn't lose any money, and he already had more than he could spend in a lifetime.

He looked at me as if I had asked the idiot question of a lifetime. He said, "It's not about the money. The money is only a scorecard. It's about doing it."

(3) Interesting questions at the end. I don't pretend to know the beginnings of an answer to them yet. Nevertheless, they are worthy of consideration.

I have to say, you have one fine website. Where have you been all my blogging career?

6:26 AM  
Anonymous Anonymous said...

oh yes... money does change people. My father is getting a large sum of money and the greed of it is starting to show.

6:27 AM  
Blogger Enemy of the Republic said...

I praise and revere you. I got a C in that class.

7:04 AM  
Blogger Sling said...

God shows his contempt for wealth by the people he gives it to..Or so say us regular folk.

10:58 AM  
Blogger SJ said...

Very very good post.

I personally have been thru various periods of abundance and deficit (never in a extreme way) I am doing good now I am happy but not content :) It's finding that difference that helps contentment can lead to stagnation happiness to growth.

12:46 PM  
Anonymous Alex M Thomas said...


Money was originally introduced for convenience in exchange.

Not money is what determines excahnge. The main function of money was being a medium of exchange.

Since, like you mentioned, these days everything moves ONLY with money.

Moreoever, a state cannot exist where every one is poor or rich because everyone has different capabilities.

But if there was barter system, would there be the need to calculate inflation?

1:49 PM  
Blogger Aditi said...

money grants power, money grants control over people as u wave the bills in the air..
money is the norm and the ones that dont agree are called whimsical fools by the world..
but yes if we didnt have money we would ahve something else to measure denote power

3:14 PM  
Blogger ThanKwee said...

HI Princess Banter!

Ah, a topic about money..

Hmmm... I have mixed feelings about wealth. I used to be wealthier, and I fully enjoyed things such as taking cruises on nice ships, eating delicious meals in some exotic place, staying in some outrageously beautiful place with a breathtaking view and a jacuzzi, stuff like that. However, in order to have that, I spent so much time working.

These days I don't spend one penny more than I need to for necessities and I find that the less that I spend, the more free that I feel. I now have much more time to devote to my own interests instead of all of my efforts going to the benefit of some corporation.

There's a downside though. I used to be able to travel overseas every year and now I can't afford to travel as often.

I can never come to any real conclusions about money. The extreme desire for more material wealth can often lead to some evil actions, such as stepping on people to climb the corporate ladder, or it can result in a certain shallowness because thoughts and actions of earning money tend to absorb so much of one's time with some people.

However, when I used to make more money, I used to donate a lot to different causes. Now I cannot afford to be so helpful to others.

Too complex a topic with so many different variables...

I admire the way that you organized your thoughts and expressed yourself here PrincessB. Another good read and a bit of reflection this morning.

Thank you.

9:18 PM  
Blogger Velu Nair said...

I am at a total loss of words here. thats quite an exhaustive post is all that I can manage to say!


9:37 PM  
Blogger sirbarrett said...

Even if we're self employed it seems like we're always working for someone that we have enough money, so that we can have what we want...mammon.

I always wonder why the inflation rate is around 3% every year. Do you think it's an instinctual habit that we value money less and less and pay more and more just to live?

10:16 PM  
Blogger Sinister Sally said...

money isn't everything....but it sure can help...

10:55 PM  
Blogger paddy said...

Not having money makes people evil.
what was it Sigmund Freud said...something like if you've no shelter and no food your mind is concentrated only on getting such.
If everyone had enough they would be only concerned about happiness, peace of mind, god call it what you want. Simple as that. Money is the root of all evil Amen
Y;-) Paddy

11:56 PM  
Blogger Glamorous Redneck said...

I've had lots of friends change because of money too. It's so sad that some people can let something so stupid change their morals.

12:57 AM  
Anonymous Anonymous said...

Money is not the most important thing in the world. Love is. Fortunately, I love money.

I don't know who said that. But I imagine they have very nice shoes.

6:08 AM  
Blogger foam said...

hmmm, money. i work for mine. i don't go hungry, i can buy within reason almost anything i want. thank goodness my tastes are modest. i wonder if i would want more if i had more to spend? i don't know.
well, i know...i'd buy more art. art that i can't afford. yes, that would be it.

7:27 AM  
Blogger CM-Chap said...

Hey princess...very nice correlations... By the way can you transfer few million dollars to me sometime.... I will retire from my wrk.

8:44 AM  
Blogger Mumbai Guy said...

You are a professional writer/ blogger. Each line carefully punctuated and each paragraph well written. Nice.

8:51 AM  
Blogger Keshi said...

Interesting post.

**If not for money, then I wouldn't have a job.

U cud say that too..but I'd say that I have a job cos I need to my, enjoy...basically to LIVE.

**Why is money so important? However, here's a spin-off from that question: What is it about money that changes us?

I'll be really didnt ever change me. Im still the same girl that I was before getting a job. I see money as something needed to survive...not something that Im gonna take too seriously tho :) Altho I have seen so many ppl change cos of money. So what is abt money that changes those's it's BUYING quality. Alot of ppl think money can BUY alot of things...not always. Money can never BUY u peace of mind.


11:23 AM  
Blogger whimsicalnbrainpan said...

Another thought provoking post.

Being on disability and having to make do on less than $700 per month I know what it is to not only want, but at times very much need, more money.

I also have enough of a clue to know that my "poor" is filthy rich compared to how a lot of people live in this world.

11:56 AM  
Blogger Anu said...

very true!!! money truely decides who has a upper hand in the lives of whom...

its the sole reason why we put on our shoes and go out in this whole wide be succesful,to earn money, to enjoy life

sometimes i wonder...have we all become cynics??? is nothing more thna money important to us?

"As P.T. Barnum once put it: Money is in some respects life's fire: it is a very excellent servant, but a terrible master."- this summarizes the definition of money.

very well written! keep them coming :-)

5:56 PM  
Blogger Welshcakes Limoncello said...

Hi. Nice blog. That's an interesting question - what would we have found to barter with if we didn't have our currencies. On your profile you say you couldn't be without your make-up - same here!

10:50 PM  
Blogger Self Taught Artist said...

Money is no different than love, looks, etc. It stands for something but is meaningless in and of itself.
people who are unhappy are unhappy regardless of how much money they have.
people who are happy are happy no matter their money.
money helps, just like sometimes it helps to look good....maybe. I usually veer away from good looking rich people.

11:22 PM  
Blogger parisian cowboy said...

I don't think money makes people evil. You can be poor and evil and rich and generous.

6:09 PM  

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