Still the Waves

Capital is accumulated wealth employed reproductively. Hoarding is amassed wealth put away for preservation or future use.  Reinvestment - that is what separates the two. Capital is alive. Capital can be the heart that supports Labour. Capital can work for money, so we can Labour for love. Buffers may appear to be Hoarding rather than Capital.  Because Buffers can’t really work that hard. “A little extra” put aside in case. An Emergency Fund. Say 3-6 months spending if you live mostly hand-to-mouth. In case your hand gets hurt, its work gets interrupted, or something out of the ordinary attempts to knock you off course. It is working, but more as a private security guard, who you hope largely does nothing. Hoarding is when this gets lazy and wasteful. When it isn’t doing anything of value. A Buffer isn’t Hoarding. It lets you breathe. It lets you look up and plan. It stills the waves so you can set sail.

Money Makes Money

I make assumptions. One of those assumptions is that money can make money. That hoarding is stupid. Buffers aren’t hoarding. A Buffer is some money, or energy, or (fill the gap with something that is essential) that is there in case of an emergency. The world is complicated, ambiguous, and random. Nothing happens in straight lines, so we need to hold something back. Emergencies lose their teeth when you plan for them. Beyond a Buffer, extra becomes wasteful. The magic trick of Capitalism is to keep the extra working. Instead of hoarding, money that does something useful gets paid. Capital can grow, or sustain. A Sustainable Drawdown Rate is the assumed amount of spending that the average 65-year-old can extract from Capital without the money running out. 3.5% is a reasonable SDR. The underlying assumption is that money can comfortably be paid $3.50 for each $100 that is put to work (rather than kept under the bed). On average, you can spend that $3.50, and still have what you had at the beginning of the year. Capital can be the breadwinner. Capital can work, so we can live.

Money can win bread

Lazy and Flashy

A key innovation of Capitalism is the explicit recognition of the costs of Conspicuous Hoarding & Conspicuous Consumption. If “excess stuff” is Capital, then Conspicuous Hoarding is keeping more than you need or use idle, and Conspicuous Consumption is using more than you need to show what a big deal you are. Capitalism incentivizes people to put their excess to work so it will grow. To get the stuff a job doing useful things for other people. Conspicuous Hoarding is lazy Capital… it doesn’t grow. The stuff just sits there & slowly withers. Like a fully paid off shop on a High Street that the owner doesn’t need to rent… so it just sits there empty. Like an unused field that could be turned into lots of homes. Conspicuous Consumption is stupidity tax. It fires the Capital for the one who flaunts it. In the past, wealthy people would have wanted to show how wealthy they were. Capitalism means that if you do this, forces are there to shrink the amount of Capital you have. That’s why you see many Billionaires in T-Shirts and Genes. Their money is working. Capitalism sneakily takes stuff from the Rich & gives them a number on a piece of paper in exchange. Sorry Scrooge McDuck, if you have a pool full of coins, you are a moron & won’t be Rich long.

Stupidity Tax

Conspicuous Consumption is a stupidity tax. Conspicuous Consumption is the lavish spending of money for the express purpose of demonstrating that you have the (appearance) of money to spend. Normally, it is associated with "New Money". It can be debt-financed (big car, big loan), and is seldom sustainable.

It doesn't bother me as much as Conspicuous Hoarding. Both thrust wealth, income, or bad financial planning, in the face of people with much less. Both are a way of wallowing in luxury while others are struggling to survive. The difference is that Hoarding actually gets in the way of other people. Hoarding is of the Needs. Consumption is of the Wants.

So if someone wants to pay a Gazillion Dollars (the record is $450 million at the moment) for a painting... nothing is made or destroyed. The painting simply changes hands. Conspicuous Consumption is a way of firing your money rather than investing it. It works for someone else, and you consume any rights. On a smaller scale, the same can be said of excessively fancy clothing, nights out, or anything else that doesn't stop anyone else from being able to survive. Say you buy a bottle of 1869 Chateau Lafite-Rothschild Wine for $232,692, it is still just a bottle of wine. No physical cash is even likely to change hands. It will just be a swap of 1s and 0s in the code of a bank. Maybe the same bank.

A form of Conspicuous Hoarding is NIMBYism ("Not In My Back Yard"). When people oppose a development that will benefit the community, because it has some negatives for them personally. Even though they have more than their fair share. Conspicuous Hoarding is when not everyone has even nearly enough... and you insist on your big slice of the pie. Water is another example. If you insisted on continuing to have baths, when you were living in a City with dramatic water restrictions... that would be Conspicuous Hoarding.

Money isn't a thing. It is smoke and mirrors. You need to look through the clouds to see what is going on behind the scenes. That is what really matters. Don't be fooled by what you see. 

$450 million picture

Salvator Mundi

Piles of Money (with Brett)

Trev

One of my frustrations is that early on we get cast into 'lefties' and 'righties'. There is a saying that if you aren't on the left when you are young, you have no heart, and if you aren't on the right when you have grown up, you have no head. The truth is money isn't actually a thing. It is an agreement. An abstract idea that helps us count things and get things done. When we were mostly farmers, we probably understood each others' worlds. Now, what you understand depends on the path you have taken, and our lives can be very different. The left/right fight descends into a rich/poor fight. I have no problem with people being very rich. Someone with very little can be rich in my mind (A Swami in an Ashram). Someone with 'piles of money' can live a relatively simple life with that money working for other people. I have a problem with poverty. I am much more concerned about people not having the basics than inequality. I am much more concerned with conspicuous hoarding than conspicuous consumption (which I think of as a stupidity tax). How do we shift the conversation from a fight to increased understanding?

A Rich Swami

Brett

i have never been a huge fan of labels, because like you, i find them so limiting and inadequate in terms of what they are trying to describe or box in. Also because people tend to view them as all-encompassing so if you are 'left' you are everything every 'left' person has ever been and so on. In terms of rich and poor i have huge problems with the disparity between them, the idea that someone is rich because they 'earned it' [which can play out on so many levels of privilege and how that money was really obtained but usually by some form of oppression to someone along the line] and the reality of someone being okay with drinking a R 750,000 bottle of champagne while someone else is forced to defecate in a bucket in the same room they sleep in. i think i can agree with you on the basics vs equality thing but because there is such a huge lack of basics for an overwhelming percentage of people the out-of-control affluence of the some sickens me to my very core in the face of the rampant inequality and lack of basics. If everyone had enough i think i would be a lot more okay with some people having more. But we are so far from there. Is it even right to ask about increased understanding while so many belly's scream out with malnutrition?

Trev

Less a case of 'is it even right to ask', and more a case of what is the best next step. There is a lot of evidence that we are making incredible process in destroying extreme poverty. Max Roser does some great work illustrating this at 'Our World in Data' (https://ourworldindata.org/extreme-poverty/). Hans Rosling, who sadly passed recently, did a wonderful TED talk on 'how not to be ignorant' which talks about our inability to see where we are making progress. As a Soutie, I get torn between a Rich Country and a 'Two World' Country in terms of seeing this play out. Putting aside your R 750,000 bottle of champagne, I struggle buying cups of coffee and movie tickets in the UK when I know that money could go so much further in South Africa... let along Uganda, Kenya, Sudan or the Central African Republic. I think the 'R750,000' bottle is a stupidity tax from the person spending it to the person receiving it. This is the 'understanding' bit I think is NB. Hoarding food, accommodation, water, or actual stuff should get a huge stigma. We should cheer on Rich people spending stupid money on things that you can get much cheaper. My point is the appropriate allocation of our anger and effort.

Brett

If the stupid money rich people spend on things that you can get much cheaper went to help the poor i would be first in line with the cheering, but it doesn't. The rich get richer, the poor get poorer and a system that continues to largely favour those on the top remains pretty much intact. i don't know what an alternative system would look like without either [A] buy in from the rich to really distribute their wealth [not going to happen] or [B] the mob with pitchforks finally deciding they have had enough [a terrifying possibility] and while too many futuristic Mad Max/Waterworld strongest-of-the-strong survive movies have no doubt influenced my thinking in that regard, the possibilities are there. In Cape Town we are literally running out of water and if there does come a time when there is no water and people need water to live, well then shit's gonna get real, right? In terms of hoarding i absolutely agree with you. In fact there was a guy who said something about not storing up treasures on earth where moth and rust can get to them but invest in treasures above and the picture i have of the 'above' is a place where only people count - all of our stuff will eventually rot and so my driving question becomes, 'how am I investing in people down here?'

After Water

Trev

My point about 'Money is not actually a thing' is worth diving into. Someone buying a R750,000 bottle of Champagne is an idiot. Part of why they do that is to show they can. The mere fact that they do results in some tax... the more stupid the figure, the higher the tax. Same is true of the competitive pricing in paying the most for Art that results in breaking records for paying the most ever. Nothing is actually lost here. This is fundamentally different from the Conspicuous Hoarding I mentioned. Keeping rooms free in places where there isn't enough housing. Watering your garden when there isn't enough water. I disagree that the current system has resulted in the rich getting richer while the poor get poorer - if you look on a global scale. I agree that that is the case if you look on a national scale (i.e. through a global apartheid lense). The Global poor have been massively and miraculously pulled out of poverty over the last few decades. This has been politically awkward in rich countries as the 'Poor Rich' have seen wages stagnate... while the 'Poor Poor' and 'Rich Poor' have done well. Branko Milanovic's 'Elephant Chart' is relevant here. I am not saying there aren't lessons to learn and we can't tweak the system. Corruption and dysfunctional politics are enemy number one in my view, and a Universal Basic Income is the best tweak I can think of.

'The Elephant Chart'

Brett

i think for me it's the idea of someone who has the capacity to spend R750 000 on a bottle of alcohol which could literally provide food for 750 households for a week or maybe more. That is obscene. It is more obscene to me that people are totally okay that someone can have the capacity to do that while others are starving as if the two are not connected in any way. It metaphorically blows my mind that people don't have a moral issue with that [cue rant about football player's salaries and then actors, singers, politicians, CEOs etc]. The Universal Basic Income to me feels like a major push in the right direction. i also very much like the idea of a Maximum wage but also for us to progress in any helpful direction with these conversations i think we seriously need to find some way of moving away from a me-based society to a we-focused one. The Ubuntu idea of being a person through people, if we tilt the lens just a little bit and see it as 'i hurt because you hurt' wow then maybe we could get somewhere. Most people would do that if it was family or a close friend, but how do we stretch that line to include neighbour, stranger and refugee?

Trev

I agree that the difference in spending power does bring a little vomit to the mouth, but I think the expensive bottle should be very low on our anger priority list. I also don't get bothered by maximum wages. It is the 'fundamental investor' in me that thinks that what something actually does matters more than the smoke and mirrors of the price tag. The R750,000 bottle of champagne is still just a bottle of champagne. The price tag is just a fancy story. I feel the same about footballer's salaries etc. The idea that a salary is equal to what something is worth is wrong. Salary is not value in the same way as price is not value. Water is MUCH more valuable than champagne, but only a complete fool spends R750,000 to show off. Why UBI is powerful is it shifts the focus to what really matters. Empowerment rather than comparison with someone else. *Universal* empowerment without judgement. Maximums & Minimum wages have a gazillion ways to get around. The really rich don't earn the majority of their money through wages so maximums struggle. Minimums shift the burden to employers rather than society. I am 100% with you on the community building and poverty destruction. Expanded empathy and communication. I just worry people think people like Warren Buffett literally have Scrooge McDuck pools of money to swim in. He doesn't. He lives a comparatively simple life with most of his money invested in companies that do stuff. I am completely cool with that. Capping the amount those kinds of rich people 'have' is not the way forward.

Brett

Ja, i just don't see that. i think it's way more than showing off - it's a sign of the fact that that particular person has the ability to do that kind of thing without even thinking about it while another family is struggling and being torn apart [by 3am departures for three modes of transport for work] and still just scraping by. The entitlement that goes alongside those kind of opportunities [and R750 000 champagne is maybe a smoke screen so R40 coffee then] and the idea that 'I am worth this and someone else is somehow worth nothing' is what makes it a moral conversation for me. The philosophical viewpoint that one human is somehow [usually though no particular skill or achievement of their own although often with some kind of hard work somewhere along the way] worth THAT MUCH more than another is disgusting to me. i think for it not to be disgusting or not to be even considered problematic helps a lot of people sleep at night but i think this is where i see the major problem - not so much the money and the stuff but the 'i am worth something and you're not' of it all. That feels undeniable to me. As opposed to the realisation at some stage that i have this stuff [t might be money, opportunity, network, stuff, skills] and you don't and i can share it with you so that none of us has to suffer needlessly. The fact that this isn't an option for so many people - pleasure over shared upliftment - is a sad state of affairs in the world. 

Trev

It is definitely a moral conversation. I don't deny that. I am just a deep pragmatist preferring, 'what is the best next step' to Pyrrhic victories and circular ideological arguments. In liberal democracy, we don't need everyone to buy in to fix things. It is way more important to me that the 'base problem' is solved, and we destroy poverty, than that we cap what people earn. I just don't get that worked up about numb nuts spending extravagantly and stupidly. It shifts more wealth away from them. I also agree that Privilege is just accumulated entitlement. Just watch a toddler's reaction to a competitive helicopter parent, and repeat that little emperor behaviour till they feel their social capital is their merit. I am all on board for getting upset about actual stuff that is being withheld, e.g. water, housing, food etc. I am all on board for solving financial poverty. I am just saying, the idea that Mark Zuckerberg could take his $70 billion wealth and give 7 million people $10,000 is wrong. He doesn't have that money in a pile. It's a made up guess of what he owns is 'worth'. It isn't a physical thing that can be given away. Understanding the physical things behind the money is way more important than getting distracted by the big numbers. Let the stupid rich be stupid. Let the naked emperor wear his imaginary suit. Solve the problems that matter.

Brett

I agree with you in terms of the problem-solving needing to happen on the ground and in and through relationships - that for me is the key to ending all the big ones [poverty, racism, war etc] because once the issue moves to a person you get more invested in terms of making a difference. Shane Claiborne has this quote in 'The Irresistible Revolution' that goes something along the lines of, 'For poverty to end the rich need to meet the poor, not simply give to them.' So the question would be how can we get creative about bringing rich and poor to the dinner table [and sticking the rich with the bill! Or maybe humbling them by letting the poor pick up the tab?] and fostering relationships. So the action happens on the ground but i still think there is a place for critiquing big money although perhaps with the understanding/expectation that that is unlikely to bring change. But for one person it could and then perhaps spark some kind of domino effect so we need to keep the message of "How you live is not okay" being broadcast while our focus is real tangible on-the-ground community and relationship building.

--- Other chats and discussions with Brett Fish ---

Growing Roots  #NotOnOurWatch  Listening Better  
Finding the Words  Words to Life  Hearing the Listeners  

Breaking Bread  Learning and Relearning

The times they are a changing

So now. My attempt to question and justify what I believe has led to some dramatic (for me) changes in perception in the last while. The next in the firing line is my hoarding nature.

Anyone who knows me fairly well will know that I am a very nostalgic person. I keep lots and lots of things. Here are some of them:

1. A Coke Can Collection I inherited from my brother when I was 8 and he let go at the age of 13. It is 20 years later and I have not yet let go. With a little (lot of) help, my last addition to the collection was in 2002 during the football world cup. The collection is now being stored in Cape Town and I have more than 400 different cans. I am not ready to let this go.
2. I have every card I have ever received, including ones sent to my parents congratulating them on my birth. Cards are slowly going out of fashion, or maybe I am just get older so birthdays are less significant... so their shoe box home has been and will continue to be sufficient.
3. A DVD collection of maybe (I haven't counted) 100 films. I feel this collections days are numbered in the same way my CD collection seems a little obsolete now that they are all on my ipod.
4. Many many photo albums. I love photos. I always took heaps but now don't have a digital camera other than my cellphone and have relied on others. I have a feeling photo albums are also going to become obsolete. I have converted 15 years of films to CD, so I can now throw away the films (for some reason this is one of the hard tasks I am struggling with).
5. I have more than 15 years worth of Sports Illustrateds. I like looking at the old copies and it provides adequate justification for getting the swimsuit edition each year. The days of this collection are numbered however. I can't justify keeping them. My mother happens to do art workshops for children and I think they will get more out of them than me. I don't like the idea of them being cut up... but equally, this is probably the most logical step for me to start the purge on my hoarding nature.
6. What got me thinking about this post was seth godin talking about the Kindle. I have a reasonable collection of books, but no one ever reads them. They are essentially decoration. A friend at university had a `open book policy'. He was the token BA student in my residence and a little different from most, but he had a great eclectic book shelf and was happy to lend books, and happy to borrow. He kept no record of who had what. He figured as long as he had roughly the same number of books as he thought he should, the world was in equilibrium. Nice idea. I feel that I should be giving my books away... it seems they would be doing better in someone elses hands. I should give them to someone with the express instruction that when they are done, they should do the same (with the same instruction). Certain books I am more likely to read again, perhaps I should keep? In honesty, my DVD collection and CD collection are larger than my book collection. I always thought the idea of building up a personal library was a nice one, but the kindle changes that, the kindle is a library the size of a book.
7. I also have a certain collection which only a certain few know about which is probably best kept quiet. Yup, I shouldn't write about it on a public blog... but most of the people likely to read this know about it anyway and it would be conspicuous by not being mentioned. One day when I am a famous artist all will be revealed ;-)
8. Clothes wise, I am at my worst. I was reminded of this when seeing someone recently I hadn't seen in years, and the clothes I was wearing being more recognisable than me! I should and will use this as the first point of my purging.
9. I have journals from since I was 9, all my creative writing from High School, and project from all the way through.
10. My uncle, knowing I like to keep odds and ends made me a very cool `memory box' in which I keep odds and ends. My rule is that if I can't remember the significance of the odds or ends, they have to go.

I should probably start with the CDs from (3), the films (4), the magazines (5), and the clothes (8). I feel kind of justified in keeping the rest.

Stuart argues that we store a lot of our personalities online through blogs and facebook. I imagine he would extend this to the things we own as well. While there are a number of things I have let go of, like religion and (in the process)patriotism, those were largely because of clear obastacles I believe those parts of my personality caused in my search for figuring things out. These other things seems like a part of me that does no one any harm, other than the storage difficulties.

But yes, I admit, it is time for a lot of the clothes to go.