TrueValueMetrics ... Impact Accounting for the 21st Century

Date: 2024-10-31 Page is: DBtxt003.php L07-ECONOMY-MONEY-LIQUIDITY

ECONOMY
MONEY / LIQUIDITY
A key feature of the classic economic system ... essential ... but a problem and maybe a solution

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ECONOMY / MONEY / LIQUIDITY
A VITAL LUBRICANT .. BUT NOT THE ENGINE

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FINANCIAL CAPITAL		PHYSICAL CAPITAL		INTANGIBLE CAPITAL
INVESTMENT	BULLS	BUILDINGS	STEEL MFG.	SECURITY	CULTURE

THE FINANCIAL ECONOMY / MONEY and LIQUIDITY
MONEY US$ has has massive value loss over time	MONEY BASE Monetary base has expanded since 2008	STOCKS UP Stock market has been spectacular	MONEY DOWN ... but the buying power of the US$ is way down	WAGES FLAT and wages flatlining while productivity grows.	GDP -v- GPI While GDP is up, progress (GPI) is flat
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ECONOMY / MONEY / LIQUIDITY PROFIT LESS IMPORTANT THAN PEOPLE AND PLANET	Open L07-ECONOMY-MONEY-LIQUIDITY
MONEY / LIQUIDITY A VITAL LUBRICANT .. BUT NOT THE ENGINE	Open L070-ML-MONEY-LIQUIDITY
EXCHANGE / TRADE IMPORTANT PART OF OPTIMIZING ECONOMIC PERFORMANCE	Open L070-XT-EXCHANGE-TRADE
THE STATE OF ECONOMIC CAPITAL GROWTH OF ECONOMIC CAPITAL ON ITS OWN IS A FAILED METRIC	Open L0700-CS-EC-ECONOMIC-CAPITAL
THE POSITIVE CONTRIBUTION OF ECONOMIC CAPITAL ECONOMIC CAPITAL ENABLES SOCIAL AND ENVIRONMENTAL PROGRESS	Open L0700-PC-EC-ECONOMIC-CAPITAL
CREDITS and DEBITS of VALUE ALL THE DIMENSIONS IMPACTING ALL THE CAPITALS	Open L070-CD-CREDITS-and-DEBITS-of-VALUE
DEBITS and CREDITS of VALUE IMPACTING ALL THE CAPITALS	Open L0700-CD-CREDITS-and-DEBITS-of-VALUE
CORPORATE PROFIT THE MOST IMPORTANT GOAL FOR DECISION MAKERS IN BUSINESS	Open L0700-SS-PROFIT
CAPITAL MARKET PRICES THE MOST IMPORTANT GOAL FOR MOST INVESTORS	Open L0700-SS-CAPITAL-MARKETS

FINANCIAL CAPITAL

PHYSICAL CAPITAL

INTANGIBLE CAPITAL

THE FINANCIAL ECONOMY
INVESTMENT	BULLS A bull market has been good for investors	STOCKS UP Stock market has been spectacular	MONEY DOWN ... but the buying power of the US$ is way down	WAGES FLAT and wages flatlining while productivity grows.	GDP -v- GPI While GDP is up, progress (GPI) is flat
Profits, Stock Prices and GDP measure success in the modern economy
The financial economy has grown robustly since the 1980s. Amazing innovation has been deployed mainly to improve profit performance. The huge expansion of financial wealth is excessivly concentrated. Concentration of economic power by both individuals and corporate organizations has come at the expense of everyone else. A lot of people are 'mad as hell' and don't intend to take it any more.

THE REAL (PHYSICAL) ECONOMY
BUILDINGS	INFRASTRUCTURE	STEEL MFG.	CEMENT MFG.	SHIPPING	RAILROADS
Buildings / Infrastructure / Industrial Processes / Transport
Modern engineering and technology is deployed and exploited to improve profit performance. Rather little is is deployed to make society and the world a better place. The modern 'real' economy is pretty amazing, but not so much in the news (Western news, that is). Many of the more amazing things are going on in the Middle East (e.g. Dubai) and Far East (China).

THE INTANGIBLE ECONOMY
KNOWLEDGE	EDUCATION	GOVERNMENT	SECURITY	CULTURE	RELIGION
Many of these important things make life worth living
These elements are very important, but metrics for their value are undeveloped. The intangible economy is a very important contributor to quality of life. Will remain at the margin as long as the dominant performance metric is mainly profit.

MONEY / LIQUIDITY
Stock market	Intangible value	Money supply	World GDP growth	US GDP growth	GDP v GPI
Without money / liquidity, the system stops working ... or never gets started
The money system is very powerful, and difficult to understand. Some commonly held beliefs are wrong. It is unclear if any of the proposed better systems would be any better.

Economic and financial metrics going up ...
US GDP growth	World GDP growth
Stock market	Intangible value
Money supply	Balance sheet cash
... but social metrics have flatlined or worse for several decades ...
Value of $ down	Value of $ down		The buying power of money has declined dramatically over time ... likely because of a systemic flaw in how the money system works
GDP v GPI	Wages flat
... and environmental trends are catastrophic
		CO2 concentration
Temp v CO2	Sea level rise	CO2 emissions

FINANCIAL CAPITAL The money denominated component of wealth	Open L0700-CS-EC-FC-FINANCIAL-CAPITAL
Financial Goodwill The value attributed to profitability in excess of the historic accounting cost	Open L0700-CS-EC-FC-Financial-Goodwill
Money Money ... a store of value	Open L0700-CS-FC-Money
Securities Financial instruments of all sorts	Open L0700-CS-FC-Securities
FINANCIAL The conventional system of accountancy	Open L0700-MA-FINANCIAL
FINANCIAL ACCOUNTANCY The conventional system of accountancy	Open L0700-MA-FINANCIAL-ACCOUNTANCY
Alternative Currencies / Complementary Currency Sometimes referred to as Alternative Currency, LETS, etc.	Open L070-ML-MONEY-LIQUIDITY
Alternative Currencies / Complementary Currency Sometimes referred to as Alternative Currency, LETS, etc.	Open L0700-ML-ALTERNATIVE-CURRENCIES
Cryptocurrencies A game changer ... but not yet clear what game!	Open L0700-ML-CC-CRYPTOCURRENCIES
Cryptocurrencies / Bitcoin Was priced at around 10 cents, now somewhere between $8,000 and $19,000	Open L0700-ML-CC-Bitcoin
Cryptocurrencies More energy effficient ... but pricing still difficult to justify	Open L0700-ML-CC-Ethereum
Currencies A game changer ... but not yet clear what game!	Open L0700-ML-CURRENCIES
Finance A game changer ... but not yet clear what game!	Open L0700-ML-FINANCE
Financial Inclusion A game changer ... but not yet clear what game!	Open L0700-ML-FINANCIAL-INCLUSION
How MONEY Works The essential basics of how the MONEY economy works	Open L0700-ML-HOW-MONEY-WORKS
Value Based Currency Units A proposed framing for a 21st Century liquidity system from TrueValueMetrics	Open L0700-TVM-VALUE-BASED-CURRENCY-UNITS
MISC MATERIAL Misc material related to money, finance and banking	Open L0700-ML-zMISC-MATERIAL
BANKING-FINANCE The money denominated component of wealth	Open L070-BF-BANKING-FINANCE
BANKING-FINANCIAL-SERVICES Misc material related to money, finance and banking	Open L0700-SI-BANKING-FINANCIAL-SERVICES

Money Supply

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Stacks of 50-subject one dollar note sheets at the U.S. Bureau of Engraving and Printing in Washington on April 14, 2015. (Andrew Harrer/Bloomberg)

Cut stacks of $100 bills make their way down the line at the Bureau of Engraving and Printing Western Currency Facility in Fort Worth, Texas. (AP Photo/LM Otero)

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Bank Lending

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UK Bank Lending by Sector from 1997 to 2012

UK bank lending grew along with the size of the British economy from 1997 to around 2007, at which point there was a surge in lending to the financial and real estate sectors ... and a subsequent banking crisis as these loans proved unviable. What is particularly concerning is that the lending to non-financial businesses ... what one might describe as the 'real economy' which produces the goods and services that we all need to live our lives, has flatlined for this period, as it has done for a very long time before this period.
More about Banking and Finance	Open L0700-SS-BF-BANKING-FINANCE

Crowdfunding

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	Crowdfunding Some more detail about Crowdfunding
	Crowdfunding What WikiPedia says about Crowdfunding 'https://en.wikipedia.org/wiki/Crowdfunding'	Open Wikipedia page

Initial Coin Offering (ICO)

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	Initial Coin Offerings (ICOs) Some more about ICOs	Open L0700-II-ICO
	Initial Coin Offering What WikiPedia says about ICOs 'https://en.wikipedia.org/wiki/Initial_coin_offering'	Open Wikipedia page

Initial Public Offering (IPO)

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	Initial Public Offerings (IPOs) Some more about IPOs
	Initial Public Offerings (IPOs) What WikiPedia says about IPOs 'https://en.wikipedia.org/wiki/Initial_public_offering'	Open Wikipedia page

Private Currency

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	Private Currency Some more about Private Currency
	Private Currency What WikiPedia says about Private Currency 'https://en.wikipedia.org/wiki/Private_currency'	Open Wikipedia page

Complementary Currency

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	Complementary Currency Some more about Complementary Currency	Open L0700-ML-ALTERNATIVE-CURRENCIES
	Private Currency

Stock Exchanges

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	Stock Exchanges Some more about Stock Exchanges
	Stock Exchanges What WikiPedia says about Stock Exchanges 'https://en.wikipedia.org/wiki/Stock_exchange'	Open Wikipedia page

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