Genius of money chapters 5 and 13

Adam Smith, known as the father of economics, believed that self-interest and competition were two key factors that would guide the economy. Nevertheless, author John Bloom analyzes the social paradox this theory has built in it. He points out that "the shadow side of Smith’s socio-economic theory is created when an individual’s (or corporation’s) self-interest turns to greed and suffers from the condition of 'never-enoughness'"(Bloom 19). As the gap between the rich and the poor widens, and the presence of the middle class seems to diminish, this shadow seems to be growing in size. The author also references to JP Morgan and the Federal Reserve and how they handled the recent economic crisis.

This chapter also focuses on technology and its limitations in being able to solve the world's largest problems. Bloom references the speech Bill Gates gave in 2008 at the World Economic Forum. Gates claims that technology does have immense capabilities to solve problems and to improve the lives of the underprivileged. Nevertheless, he states that "[technological] breakthroughs change lives only where people can afford to buy them – only where there is economic demand. And economic demand is not the same as economic need” (Bloom 20). To support the argument John Bloom uses alternative currencies that use technology to provide a better service, like the TimeBanks, based on time rather than time.

In chapter 13 John Bloom analyzes money and its value in society. It affects everyday choices and yet we don’t feel comfortable talking about it. The author brings the example of J.S.G. Boogs, a contemporary artist who was able to pay with fake bills drew on a piece of paper and get change in real bills. He managed to repeat this action many times, to a point where he became famous that he was able to make it to art shows, increasing the value of “nothing” exponentially. The author also covers the dilemma presented in Grimm Brothers’ story “The Grave Mound”, inviting us to reflect about how we use our money.

This chapter invites you to reflect on how money can assume different values and shapes the way we behave in our everyday life. This chapter made me reflect on how we relate to money in society and how would society work without money. At the end an arbitrary value on a piece of paper might not be any different than old currencies they used in the past. The example of the fake bills that created value says a lot about it.