The Chase
Man withdrawing money from Chase Manhattan ATM Machine
G. Boersma
acrylics on masonite
20.4" x 17.3" or 51,8 x 44 cm
2009
What you didn’t know about the financial crisis
Bankers and merchants are both interested in increasing profits, but are on opposite sides as well. It’s a little known fact about the economy and is hardly ever discussed in public discourse, but the failure to understand this leads to much confusion in economic thinking.
Money and goods are different. They always move in opposite directions. If the value of one goes up, the value of the other goes down in the same proportion.
The merchant is interested in high prices to keep the value of goods high and low interest rates to make a profit.
But the banker is interested in low prices to keep the value of money high (i.e. the value of goods low) and high interest rates to make a profit.
So clearly bankers and merchants are on opposite sides. Since both have a self-interest it’s clear we have a problem.
kind regards, Gerard
