Yiddish proverbs - money

Money is on many people’s minds at the moment. I know it is on my mind. We watch the financial crisis unfolding on TV or the internet like a slow motion train wreck. Sovereign debt crisis. Quantitive easing. Credit default swaps. Fiat currency collapse. Inflation-deflation. Moral hazard. Record gold prices.

It was much simpler in the old days (when I was a kid): you worked for money, then you spent it. Sometimes you even saved it to spend later. I agree with Paul Volcker: the last good innovation from the financial industry was the automatic teller machine. I also agree with Teddy Roosevelt:

Americanism means the virtues of courage, honour, justice, truth, sincerity, and hardihood - the virtues that made America. The things that will destroy America are prosperity-at-any-price ... the love of soft living and the get-rich-quick theory of life.

The one good thing coming out of this whole international financial quagmire is that the collective consciousness is being raised about money and morals and the responsible government necessary to achieve financial health.

You can’t expect a viable economy if the only object of government policy is to be re-elected every four years. Sir Arnold Weinstock

We need to go back to basics. When you are exhausted you still have the strength to be simple.

Here are some Yiddish proverbs passed down the generations. They were valid back then, they are valid today but nobody thinks of them.

Golden dreams make men wake hungry.

Interest on debts grows without rain.

Money buys everything but good sense.

If you have nothing to lose, you can try anything.

Once poor, never rich.

Money doesn't grow on trees.

Money is round, so it rolls away.

If I dealt in candles, the sun wouldn't set; if I dealt in shrouds, people would stop dying.

Charge nothing and you'll get a lot of customers.

Every seller praises his wares.

Life is the cheapest bargain - you get it for nothing.

What you save is, later, like something found.

A penny saved is a penny earned.

A penny is sometimes better spent than spared.

A penny is a lot of money - if you haven't got a penny.

The heaviest thing in the world is an empty pocket.

He that cannot pay, let him pray.

A heavy purse makes a light heart.

A golden key will open every lock.

It costs money to sin.              
A trade makes you a king, but robs you of your leisure.

Gold's father is dirt, yet it regards itself as noble.

Golden dishes will never turn black.

Better an ounce of luck than a pound of gold.

When luck joins in the game, cleverness scores double.

A rich man who is stingy is the worst pauper.

A rich man's foolish sayings pass for wise ones.

With money in your pocket, you are wise and you are handsome and you sing well too.

If the rich could hire someone to die for them, the poor would make a wonderful living.

The truly rich are those who enjoy what they have.

Happy poverty overcomes everything.

He who comes for the inheritance is often made to pay for the funeral.

When the father gives to his son, both laugh; when the son gives to his father, both cry.

Image from Wikipedia: silver shekel minted in Jerusalem in the First Jewish Revolt against Rome in 68 C.E.

Dark clouds over America - the annual tribute

I have been reading ‘The Essays of Warren Buffet: Lessons for Corporate America’. There is much gold to be mined here by the moral philosopher. Here is one important theme: the transfer of wealth from the US to the rest of the world.

In 2003 Buffet wrote:

(I)n recent years our country’s trade deficit has been force-feeding huge amounts of claims on, and ownership in, America to the rest of the world. For a time, foreign appetite for these assets readily absorbed the supply. Late in 2002, however, the world started choking on this diet, and the dollar’s value began to slide against the major currencies.

In 2004:

Last year we had $1.15 trillion of such honest–to-God trade and the more of this, the better. But, as noted, our country also purchased an additional $618 billion in goods and services from the rest of the world that was unreciprocated. This is a staggering figure and one that has important consequences.
The balancing item to this one-way pseudo-trade … is a transfer of wealth from the US to the rest of the world. … This force-feeding of American wealth to the rest of the world is now proceeding at the rate of $1.8 billion daily, an increase of 20% since I wrote to you last year. Consequently, other countries and their citizens now own a net of about $3 trillion of the US. A decade ago their net ownership was negligible.

Buffet goes on to project that a decade from now (in 2014) net foreign ownership of the US would amount to about $11 trillion and at 5% interest, the US would need to spend $.55 trillion annually to ‘service’ this foreign investment. With a GDP of about $18 trillion, 3% of GDP would go to the rest of the world as 'annual tribute’ for financing Americans’ overindulgences.

If the US were running a $.6 trillion current-account (trade) surplus, commentators worldwide would violently condemn our policy, viewing it as an extreme form of ‘mercantilism’…
Our spendthrift behaviour won’t, however, be tolerated indefinitely. And though it's impossible to forecast just when and how the trade problem will be resolved, it’s improbable that the resolution will foster an increase in the value of our currency relative to that of our trading partners.

In 2005 the situation continued to worsen and in 2006 Buffet notes another ‘milestone' in the deteriorating financial health of the US:

Already the prediction I made last year about one fall-out from our spending binge has come true: The ‘investment income' account of our country – positive in every previous year since 1915 – turned negative in 2006. Foreigners earned more on their US investments than we do on our investments abroad. In effect, we’ve used up our bank account and turned to our credit card. And, like everyone who gets in hock, the US will now experience ‘reverse compounding’ as we pay ever-increasing amounts of interest on interest.

This situation will only change if the US ‘massively under consumes and begins to run consistent and large trade surpluses’.

Buffet points out that the huge US budget deficits do not transfer wealth. Only when we buy more than we sell is wealth transferred to the net seller.

However, when we also borrow money to buy more than we sell, we are hastening our financial demise, and that is what we see today.

And let us not even mention what road we are taking if we don’t even borrow but merely print the money out of thin air…

I leave you with this video about the opening of the world’s tallest skyscraper in Dubai, the ‘Burj Dubai’. It is an impressive architectural achievement and a proud symbol of Dubai’s economic power. But while I watched in awe, I couldn’t help thinking that I was witnessing possibly the most spectacular manifestation of the transfer of wealth out of the US.

Amy Luft's Question on 'Answers'

Amy Luft is a freelance journalist based in Montreal. She has worked for such organizations as The Associated Press, The Gazette, CTV and Reader’s Digest Canada. This time she has a question for Answers.

What would it take to make people under 30 more interested in serious news issues than in celebrity gossip?

The answer to this question is tied up with the fact that we live in a consumer-driven society rather than a morals-driven society.
Money and politics are the driving forces of society, rather than spiritual, moral values.
The media, especially television, are the expression of these driving forces, perpetuating the status quo of the consumer mentality.
Spirituality and morality have no multi-national companies financing their advertising campaigns.
We do our best to raise our children with moral values, but are we qualified? Do we have the knowledge, the time and the skill? Do we even know the basics about philosophy?
And don't expect our schools to take up the slack. Schools teach many things but they don't teach how to live a moral life.
The lack of morality in the financial system has brought us to the brink of disaster.
The one good thing about the credit crisis is it has placed the spotlight on moral risk and moral hazard.
Perhaps in hindsight it will be considered a turning point, the point when we began to see the need for a morals-driven society.

Experience teaches only the teachable.
It takes wisdom to understand wisdom.

The Story of Stuff, with Annie Leonard

Today I discovered the following video ‘The Story of Stuff’ with Annie Leonard. Here you have the malaise and yes, the tragedy of our time in a simple yet powerful 21-minute media message. Since the 1950’s we have increasingly been brainwashed into accepting as normal a consumer-driven culture and since the 1950’s, strangely enough, personal happiness has been in decline. We live in a world where to live frugally and simply is to be a maverick and something of an eccentric. We spend money we don’t have, to buy things we don’t need, to impress people we don’t like.
I have a cellular phone that I bought about 5 years ago. I don’t use it much and it still looks like new. No one I know (or don’t know) still has one like it. Everyone else seems to have a new thin flip phone or Blackberry-type. I find myself thinking I should buy a new one. But only for a moment. I suppose I am becoming eccentric in my old age.
Watch the video, see through the brainwashing and get off the consumer merry-go-round.