I'm going to try and convince you that monetary value is not, and perhaps has never been, a concept connected to reality. This one should be fun.
The timing of this letter is less than ideal, I admit it freely. Some might even call such a title needlessly provocative as crypto swan dives into the concrete, stocks falter and a chill settles deep into market sentiment. My only defense is that the topic was decided last week, a whole different world in market-time. Such is the speed of fortune, and fortunes. But perhaps in other ways this is the perfect moment, as my own bags and many others show their volcanic nature. Sure, you can call this cope or denial, bitter disillusionment or whatever you want. Maybe it's hard-won wisdom backed by scars and fortified by enduring optimism instead. I'll let you decide.
The conventional wisdom that intrudes at this point is easily rehearsed. Money is a financial instrument that stores the value of human work, as determined by the magical and all-seeing power of Market Forces. This is the theory. And let's start by giving it some credit where it is due: the basic economic system of a free market setting prices for goods and services is one of the great technologies in human history. Many other attempts at solving the same economic problems have failed at scales ranging from miserably to cataclysmically. Put away your tar brushes and down pillows, we aren't here to smugly predict the downfall of capitalism. But there's nothing wrong with identifying a few of itsβ flaws.
And for me the most glaring issue is that markets set value, and markets are just people transacting. There's nothing magical or holy about it, and the people aren't somehow baptized of their corruptions when they begin to transact. This means that human beings, the species of whom that one relative you struggle to treat with civility is a representative, the creators of concepts like biological warfare and child abuse, are the same beings who enter markets. It has never been explained to my satisfaction why the act of entering The Market somehow cleanses humans of our deep and abiding failure to do what is right and allows us to set scientifically correct pricing with values carrying moral weight. In fact I'm deeply skeptical of the abilities of irrational, morally corrupt and intellectually limited humans to do anything of the sort. And yet this claim seems to be everywhere, for as soon as you question the connection between a price and the intrinsic or even implied value of any good you are immediately guilty of disbelief in The Free Market, and creeds are shouted at you until you stand down. I am a simple Christian, and so I'm mandated to only accept one set of authoritative truth claims on faith. That leaves me quite free to push aside the dogma of Markets and investigate a little further.
It was the crypto and web3 explosion that reopened this question in the minds of many people. After all, there can be differing opinions on the pricing of a real estate asset and everyone can still point to the land and dwelling as a possible peg for the price no matter how astronomically it inflates. When the asset is a digital image of a cartoon animal, the conversation becomes ridiculous rather quickly. Something about the physical heft of gold or even the official crinkle of paper notes and checks convince our brains rather easily that everything is according to standards and measures. But crypto wallets and exchanges don't yet have that cachet, even though they are working hard to borrow it from equities markets as we speak. So when prices dynamically reset over several months by factors of 10 or much more for blockchain based assets, we are right to ask what exactly is changing about the intrinsic value of the product in question. When market caps for inside jokes writ at the scale of currency rival that of productive and global corporations, it is fair to question the Fair Market. No wonder the whole show makes people so angry. Turns out there's no adult in the room objectively deciding what is fair and logical. And this isn't a brand new phenomenon; I don't believe that markets were somehow perfect exchanges before the innovation of the Satoshi whitepaper and are now irredeemably broken. The truth is a little bit more complicated.
Since the advent of money technology, we have been able to at least partially and inaccurately harness the perceived value of human achievement inside of external instruments. What metal coinage and mortgage derivatives have in common is their basic goal of allowing transaction against the trapped power of work. In many ways, we have built a carefully tiered and fragile confection of markets around this technology which abstracts the primary measure of value away from the work and effort of an individual. This impoverishes us all. The very fact that we believe we can monetarily calculate the worth of art, land, and people means that we attempt to do so constantly. This threatens to destroy these things in our eyes as we willingly bargain them away for the digital equivalent of carefully formed mineral lumps. I'm speaking strongly because we need to understand the situation. The optimism only matters if it holds up to the full force of everything reality can throw at us.
And the reality is that monetary technology, like any technological achievement, is capable of immense effects on human beings both for good and ill. The same unit of exchange can transact property underneath the market price to allow for benevolent giving, or allow human beings to be shipped through modern day slave markets. We cannot blame the inanimate for the sins of the spiritual united with the physical. The very danger of laying sins at the feet of a system or economic theory is that it allows the humans who committed them to walk away guilty and unpunished. But when the shared illusion flickers and dims, when we realize that the power to value is a power no market can monopolize, then we have a chance to grow.
I know I've sounded depressingly bearish for most of this letter so it's time for the hopeful turnaround. Just because human beings cannot scientifically pinpoint the exact proper value some object or concept or digital resource deserves monetarily means surprisingly little. After all, above a certain basic level the monetary value you control does extremely little to impact your real life. Haven't you found that the number in the bank you once saw as a hazy future paradise did very little to change your anxiety and discontent, once achieved? Donβt those numbers simply sit useless until youβve re-instantiated the work in a form that again takes shape in the real world? This is why a moment of volatility is actually a perfect time to test our own beliefs about the currencies we longingly gaze on inside our wallets and accounts.
Perhaps we are only able to be free of the illusion of perfect monetary value when we have made and lost an amount of money we once considered significant. Maybe when the numbers don't have the same hold over us anymore we will be more free to laugh at them, to chuckle at ourselves as we generously fling them to others and willfully waste them on beautiful realities. I think we can do the most true good with our funds when we maximize their utility in every sense of the word, forcing them to work hard for their keep and clean up the room they take up in our minds and souls. If money is going to stay around, let it be in the barn of our lives, where the willing and strong beasts of burden belong. How inappropriate for our sums and figures to shoulder their way into the living room and the bedroom as if they belonged. They leave dirty tracks in the rooms of our mind and heart, if we allow the desecration. Better safe outside, so that we might better decide how to throw them away cheerfully together in the light of the glowing fire.
WGMI π
Modernity is satisfaction with accumulated, saved and cashed time. It is closure against grace. So mission involves war on modernity. ~ John Milbank
Those of low estate are but a breath; those of high estate are a delusion; in the balances they go up; they are together lighter than a breath. Put no trust in extortion; set no vain hopes on robbery; if riches increase, set not your heart on them. Once God has spoken; twice have I heard this: that power belongs to God, and that to you, O Lord, belongs steadfast love. For you will render to a man according to his work. ~ Psalm 62:9-12