Saturday, September 24, 2016

Inconspicous Wealth

The Rich Now

Mansa Musa - The Richest Ever

One of the key features of Adam Smith's the Wealth of Nations was debunking the idea that to get more, you had to take it from someone. Believing in Mercantilism, Nations competed for wealth through War. Colonialism was a cold(ish) war between Spain and Portugal, then the Netherlands, then France and England as they attempted their own civilising missions, trying to spread faster than the others. Smith argued instead for Free Trade. The movement of people, capital and ideas. 

Before Smith, the wealthy would engage in Conspicuous Consumption. They would invest in big palaces, lavish feasts, fancy clothing and armies. Capitalism manages to abstract wealth, so that a true Capitalist will constantly reinvest rather than spend. To make your 'paper wealth' bigger, you have to invest in something that does something. Spending is like firing your money. Today's wealthiest individuals are likely to be wearing jeans and T-Shirts, the same as most everyday people. Their wealth invested and reinvested in the products everyday people use. If someone is flashing their cash around and buying luxurious stuff, they are living in the world Smith raged against, not for.

Capitalism should reflect a story of custodianship. 'You can sheer a sheep many times, but you can only skin it once'


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