A newspaper columnist asked me
recently, “In your book, The
Secret Language of Money,
you use the phrase ‘as good as gold.’ But isn’t the value we
place on gold and ‘precious’ stones arbitrary?”
Of course it is. Same with
tulip bulbs, Beanie Babies, dot.com IPO’s. For any stock, the
value is very arbitrary—it’s based on what another bidder is
willing to pay at that moment.
The stock market isn’t really
a market, it’s an auction—which activates the variables of mind
and brain. The stock doesn’t even know who owns it any more than
war bonds knew about the war.
Here’s a brief, unofficial
history of money. Before money, two goats were exchanged for five
bags of rice. Then, coins enter as a symbol of value—a tangible
equivalent, a unit of exchange. Paper bills replaced coins. Then
paper checks. Then plastic. Then a pure abstraction of numbers
stored and traded as configurations of electrons.
Gold coins are tangible,
real—you can hold them, bite them, wear them—even hide them, and
they’re still there. And gold glitters. (Call me a mind reader,
but not one of my readers wants an iron Rolex).
Madoff and Stanford didn’t do
their sleight-of-hand with gold coins. They used symbols of
symbols—derivatives of little-understood equities.
The vast majority of our money
management occurs not through our hands, or even our broker’s
hands, but inside our minds, in a complex interplay of thoughts,
emotions, and neurological wiring.
As money becomes more
abstracted, transactions are easier, but our understanding of money
fades. And our relationship with it changes.
Dave is offering a new coaching
group, Your New
Money Story™ Advanced Workshop Group using
the Your New Money
Story™ Workbook. Begins
January 11—limited to ten people.
Contact him at