The Value of Money

To countenance the expenditure of money naturally calls for some justification especially when the recommendation is conjoined with extravagance. Even the profligate spender harbours the shadow of concern for primary economic theory (though of course he seldom dilutes the strength of his initial devotion). By contrast the close-fisted penny-pincher buoys his preferred fiscal modesty with psychology, likening materialism to Philistinism. Between these two extremes of pecuniary dissolution and worldly deprivation resides the body of people who from time to time have what I believe to be a quite understandable need or desire to reward themselves. Nonetheless with all this talk of late about the incredible amount of debt being serviced by Canadians the idea of spending even funny money may be considered foolhardy. I think however that this is a proposition which needs to be re-examined in a context broader than mere economic principles or the loaded comparison of intemperance and frugality. It is my thesis that spending some money on yourself can be a very good thing indeed.

The place to start this re-examination is not with the value of ministering to one’s needs or desires, rather with the value of money itself. As trite as it may be to say it, money is only worth what we say it is. It has been my experience that the elemental and distinguishing feature of money and things is that you can’t have both, at least not if you’re other than among the very rich. It is for this reason that quirky monied people often appear to be penniless. We simply cannot see their material indicia of wealth – they don’t wear it, they don’t drive it, they don’t drink or eat it and they don’t live in it. And even if we were capable of seeing their balance sheet, it likely wouldn’t appear very interesting at all, other than containing a great many zeros at the tail end of numbers and referring to tiresome descriptions of Class ‘A’ and ‘B’ common or preferred shares. The assiduity with which these misers devote themselves to making and accumulating money is all about translating capital into more capital, assets available for use in the production of further assets. They really have a positive disdain for the perceived vulgar and trivial preoccupation of consumers with things. Having said that, I have known at least one avowed capitalist who did in fact know more than the “price of everything and the value of nothing” (Oscar Wilde’s famous definition of a cynic). Yet as much as he valued the painting in question (a typical wintry March morning scene of a horse-drawn sleigh painted by Frederick Coburn) he gave it to me because he knew his own son would merely sell it for the money. The painting held no particular importance for the capitalist but he didn’t dismiss its possible worth for others who would not equate its value with mere money.

If indeed I am correct in this admittedly simple rendition of the capitalist (the saver) and the materialist (the spender) then it is easy to see the reason for the divergence between the two species. Capitalists simply haven’t an appetite for expenditure, only reinvestment. Any materialism which might surround them is probably driven more by their family than themselves. Yet in an odd twist the spender and the saver are identical because neither of them is interested in money per se but rather only with what money can do for them, and each of them subscribes a different value to or purpose of the money they have. On the face of it, both spend money to acquire something else. By an odd paradox the investor sees only the value of the expected material return; the spender sees only the value of the anticipated emotional return. While the saver can see the predictable return of interest; the spender imagines the immeasurable pleasure of the thing acquired. In the result the entire matter is turned on its head. Both need money to get where they’re going and both have translated money into something else. Just as it is true that “money doesn’t disappear, it just changes hands”, so is it true that money is constantly transforming itself from one nature to another. In the hands of one consumer the diamond ring is a source of intense pleasure; in the hands of the younger woman who inherits it from her mother it is the seed money for capital investment. And so the cycle continues endlessly.

To really appreciate the preposterous value of money one need only consider the recent auction of British artist Francis Bacon’s triptych of close friend and fellow artist, Lucian Freud which sold for £90 million paid by a New York dealer on behalf of an anonymous buyer at Christie’s in Manhattan on Tuesday, November 12, 2013. As one reporter commented:

The prices paid for works of art at this level are, of course, beyond rationality, bearing no relation to inflation, the value of the components or even the concrete notion of investment – or certainly not in the short term. This kind of art buying has no relation to anything other than itself. But if you did have bottomless coffers and the desire to dispense some of their contents on a single object, why wouldn’t you go for something that embodies a chunk of what we sometimes still call “civilisation”, which sums up some of the things we think of as ennobling humankind as a species?

With respect I think this is pushing the interpretation of such lavish spending rather further than merited. What has melded in this instance is the very concept of money and things. The lines between the two have become entirely blurred and blended, and certainly the value of either is unascertainable.