The Price of Time
The Great Simplification #67 with Edward Chancellor
This week…
Finance, Money, Interest rates. Oh my. To many these symbols that represent and direct real resource flows are arcane and complex. But they’ve underpinned human commerce and exchange for a very long time. Today, financial historian Edward Chancellor joins me to give a meta-history of interest rates and human societies. With recent news of global financial turmoil in response to rising interest rates - after a period of ultra-low and even negative rates - taking a look at what interest rates are, how they came about and what drives them could help us interpret our present and plan for the future.
Edward Chancellor is a financial historian, journalist, and investment strategist. He is the author of Devil Take Hindmost: A History of Financial Speculation and his latest book, The Price of Time, where he explains the story of capitalism is really the story of interest: the price that individuals, companies and nations pay to borrow money. He is currently a columnist for Reuters Breakingviews and a contributor to the Wall Street Journal, MoneyWeek, the New York Review of Books and Financial Times.
How deeply entangled is this financial predicament that we’ve gotten ourselves into? Can we learn from the past to reshape a more stable monetary policy in the future, or are inflating financial bubbles (and popping them) simply in our human nature?
In case you missed it…
How certain are you that the world will unfold as you expect? While there will ultimately be only one outcome, the odds of that future fall in a distribution, with some results much more likely than others. These odds shift over time by natural physical events - and by our actions. However, no one alive can know these distributions perfectly, but instead impute their own mental distribution shaped by their own bias, knowledge, and perspective. How might we use a probabilistic approach to better understand what’s possible - and even to better relate to others? By thinking of the future as a spectrum, can we avoid falling into traps of certainty and complacency that inevitably lead to inaction?
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