{"id":115210,"date":"2023-10-17T11:53:00","date_gmt":"2023-10-17T15:53:00","guid":{"rendered":"https:\/\/www.shortform.com\/blog\/?p=115210"},"modified":"2023-10-23T14:50:03","modified_gmt":"2023-10-23T18:50:03","slug":"what-is-the-nature-of-money","status":"publish","type":"post","link":"https:\/\/www.shortform.com\/blog\/what-is-the-nature-of-money\/","title":{"rendered":"What Is the Nature of Money? Gaining Monetary Respect"},"content":{"rendered":"\n

What’s the nature of money? How does money reflect your priorities and understanding of abstract concepts?<\/p>\n\n\n\n

According to Thou Shall Prosper<\/em> by Daniel Lapin, money is a reflection of you: Everything from your possessions to your time, creativity, and energy can be measured in monetary value. For instance, when you go to work, you’re selling your time and energy in exchange for money.<\/p>\n\n\n\n

Continue reading to learn more about the true value of money<\/a>.<\/p>\n\n\n\n\n\n\n\n

Understand the Nature of Money<\/strong><\/h2>\n\n\n\n

What is the nature of money and how do you come to understand it? Lapin says you should develop a healthy respect, and even love, for your money in order to understand its true nature. However, don\u2019t love your money because of what you can buy with it, but rather because it represents the value that you\u2019ve contributed to the world. <\/strong><\/p>\n\n\n\n

(Shortform note: Lapin believes your wealth is a measurement of how much value you\u2019ve added to the world, but that assumes earnings are an accurate reflection of productivity. The Economic Policy Institute (EPI) has reported that may no longer be the case<\/a>. In fact, at least for the average American (the focus of the EPI\u2019s research), productivity has increased 3.5 times faster than pay over the last 40 years. Workers are generating more value for their employers, but seeing smaller returns on what they produce. This suggests that money earned might not <\/em>be an accurate way to measure your life or your contributions to the world, as it doesn\u2019t reflect the true value or impact of your labor.)<\/p>\n\n\n\n

Furthermore, when you view wealth as a reflection of yourself\u2014instead of just as numbers on a bank statement, or as a goal that you\u2019re supposed to chase\u2014you\u2019ll make more careful decisions regarding your finances and your business. <\/p>\n\n\n\n

Your Money Is Your \u201cSkin In the Game\u201d<\/strong>

Why would viewing your wealth as a reflection of yourself make you a better businessperson? Arguably, it\u2019s because when you equate your wealth with your worth, your business dealings involve more personal risk<\/em>. If you make bad decisions<\/a> that decrease your business\u2019s monetary value (and thus your wealth), not only are you losing money, but you\u2019re also losing self-worth.  

According to Nassim Nicholas Taleb<\/a>, taking on personal risk\u2014what he calls having Skin in the Game<\/em><\/a>\u2014is the foundation of any good business<\/a> strategy. He claims having \u201cskin in the game\u201d will help you in a number of ways<\/a>:

Engagement. <\/strong>People are more focused and work harder when they\u2019ve got something to lose. 

Experience. <\/strong>Taleb believes that learning through experience (and especially through failure) is more effective than learning through study and reasoning. When people\u2019s failures affect them personally, they\u2019re more likely to take those lessons to heart. 

Ethics. <\/strong>People are more likely to behave ethically when they know they\u2019ll face personal consequences if they get caught behaving un<\/em>ethically. <\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

Why Charitable Donations Are Profitable<\/strong><\/h4>\n\n\n\n

Lapin says that how you use your money reflects on you just as strongly as how you earn it. In other words: While the money you gain <\/em>reflects the material value you\u2019ve contributed to the world, the money you spend <\/em>reflects your principles and your moral character. For example, if you pay your employees well and on time, you\u2019ll earn a reputation for generosity and reliability. Therefore, it\u2019s important to be generous and charitable with your money.<\/strong> <\/p>\n\n\n\n

Jewish tradition holds that giving money to charity benefits the giver more than the receiver. First, being generous is a mitzvah<\/em> (a good deed) meaning that it will benefit you spiritually and help you feel good about yourself<\/a>. <\/p>\n\n\n\n

(Shortform note: To understand the connection between money and spirituality, it\u2019s helpful to know that Judaism places very little emphasis on the concept of an afterlife<\/a>. Therefore, when Lapin says that a mitzvah will benefit you spiritually, he means it\u2019ll help you live a good life<\/a> here on Earth, not that it\u2019ll help you get into heaven. That\u2019s also why, as we\u2019ll see later, Lapin believes that earning money can be a spiritual endeavor\u2014he sees money as a reflection of how much you\u2019ve improved the world, so accumulating a lot of wealth means that you\u2019ve performed many good deeds.) <\/p>\n\n\n\n

However, counterintuitively, giving money away is also one of the best ways to increase your income<\/a>. This is because it\u2019s profitable to have a reputation for generosity; <\/strong>people will be more willing to work with you and to support charitable causes by supporting your business. On the other hand, people who cling to their money seem desperate and untrustworthy, so people tend to be uncomfortable<\/a> doing business with them. <\/p>\n\n\n\n

(Shortform note: Some companies view charitable donations as something they can only do when profits are high<\/a>, as a way to get positive attention and tax write-offs. However, some business and marketing experts support Lapin\u2019s claim that the exact opposite is true: Corporate donations to charity increase sales and profits because customers then do business with you to support good causes. Therefore, giving money away can be the ultimate form of marketing. Conversely, companies that develop reputations for greed tend to lose customers, and therefore profits; for example, the software company Unity lost an enormous number of customers and public support<\/a> after announcing plans to charge developers a fee when users installed games made using their software.) <\/p>\n","protected":false},"excerpt":{"rendered":"

What’s the nature of money? How does money reflect your priorities and understanding of abstract concepts? According to Thou Shall Prosper by Daniel Lapin, money is a reflection of you: Everything from your possessions to your time, creativity, and energy can be measured in monetary value. For instance, when you go to work, you’re selling your time and energy in exchange for money. Continue reading to learn more about the true value of money.<\/p>\n","protected":false},"author":14,"featured_media":93604,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[81,31,9],"tags":[1293],"class_list":["post-115210","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economics","category-money","category-psychology","tag-thou-shall-prosper","","tg-column-two"],"yoast_head":"\nWhat Is the Nature of Money? 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