Borrowing Social Currency?

by Jay Deragon on 07/07/2010

If I borrow money from you to pay my expenses then you borrow money from me to pay your expenses and neither of us can really afford our expenses what happens?

We both default on our debt which hurts both of us and everyone tied to the monetary system.

Just like individuals, nations borrow money and just like individuals, they also have to repay their debt along with interest! And why some nations can’t borrow money? For the same reasons as individuals their expenses are greater than their income. To meet the gap, the country can print currency, raise debt and cut expenditure. Often a country combines the three to tackle its financial hurdles.

There are primarily three ways that a nation can borrow money;

  1. is by issuing bonds internally to its own citizens,
  2. is taking a loan from international bodies like the World Bank or the Asian Development Bank etc. and
  3. third is by taking loans from other countries.

Most Governments issue Treasury Bonds and other Debt Instruments which essentially means that governments are borrowing on behalf of the country from their citizens.

Then the second source of borrowing for countries is from institutions like the International Monetary Fund or the Asian Development Bank.

The third way in which nations borrow money is by borrowing it from other nations. Normally this is also done with some specific purpose in mind and is quite subsidized which means that the interest rates are lower than normal.

These are the three main ways in which nations borrow and lend money to each other or from their own citizens or international agencies. You will notice that most of the above behavior is quite similar to individuals and if you think about it, you will understand that borrowing without the ability to pay it back leads to devaluation, inflation or collapse of our collective monetary system .  The only real way out of debt is 1. cut expenses and 2. improve productivity.  Productivity increases revenue if and only if there is a market willing and able to consume what you produce.

Consumption cost money. If money cost more well so does consumption and then we may be forced to borrow more money to consume things and the cycle of debt starts all over again. Then again if what you consume doesn’t cost anything but it yields higher productivity could you convert the productivity into money?

Social currency cost time and using it to create value that converts into money cost time. Time is a critical element of productivity. How much time do we have before the old monetary system collapses? Not much and if you try to avoid it  then you will be  surprised or possibly destroyed when it hits you.


{ 31 comments }

wwjimd July 8, 2010 at 5:01 pm

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AnalPoet July 8, 2010 at 3:02 pm

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Venessa Miemis July 8, 2010 at 2:59 pm

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Dustin Goerndt July 8, 2010 at 12:49 pm

RT @wwjimd: Borrowing Social Currency? http://bit.ly/ckNimK #currency #economcis (cc @technoshaman @VenessaMiemis )#junto

WordBoom July 8, 2010 at 12:49 pm

RT @wwjimd: Borrowing Social Currency? http://bit.ly/ckNimK #currency #economcis (cc @technoshaman @VenessaMiemis )#junto

Alex Hall July 8, 2010 at 8:17 am

Have a read – Borrowing Social Currency? – http://www.relationship-economy.com/?p=10882

Gunther Sonnenfeld July 7, 2010 at 9:03 pm

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HBBTeamWork July 7, 2010 at 7:57 pm

RT @JDeragon: if what you consume doesn’t cost anythg but it yields higher productivity could you convert the productivity into money?http://bit.ly/aE7IwV

JDeragon July 7, 2010 at 7:50 pm

if what you consume doesn’t cost anythg but it yields higher productivity could you convert the productivity into money?http://bit.ly/aE7IwV

Business 3.0 Tech. July 7, 2010 at 7:45 pm

RT @JDeragon: Borrowing Social Currency? #socialmedia #socialstrategy #socialbusiness http://bit.ly/9MMwRf – Great read blog

wwjimd July 7, 2010 at 3:36 pm

Borrowing Social Currency? http://bit.ly/ckNimK #currency #economcis (cc @technoshaman @VenessaMiemis )#junto

Joe Grasso July 7, 2010 at 2:53 pm

Borrowing Social Currency?: Time is a critical element of productivity. How much time do we have before… http://bit.ly/auXTYV RT@JDeragon

smconnection July 7, 2010 at 2:52 pm

Borrowing Social Currency?: Time is a critical element of productivity. How much time do we have before the old mo… http://bit.ly/9reDd2

Allen Howell July 7, 2010 at 12:25 pm

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Lynn Jacobs July 7, 2010 at 12:13 pm

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Imad Naffa July 7, 2010 at 12:10 pm

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JDeragon July 7, 2010 at 11:48 am

if what you consume doesn’t cost anything but yields higher productivity could you convert the productivity into money?http://bit.ly/aE7IwV

Linda Schenk July 7, 2010 at 11:07 am

Borrowing Social Currency? http://bit.ly/d2Y070

CindyKing July 7, 2010 at 10:38 am

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Social Media Insider July 7, 2010 at 10:36 am

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JobShoots July 7, 2010 at 10:36 am

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JobShoots July 7, 2010 at 10:36 am

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Alltop July 7, 2010 at 10:36 am

Borrowing Social Currency? http://bit.ly/aTL4yU Social-Media.alltop

Alltop July 7, 2010 at 10:36 am

Borrowing Social Currency? http://bit.ly/aTL4yU Social-Media.alltop

Achievers Network July 7, 2010 at 10:11 am

Borrowing Social Currency?: Time is a critical element of productivity. How much time do we have before the old mo… http://bit.ly/9reDd2

Aron Stevenson July 7, 2010 at 10:11 am

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prblogs July 7, 2010 at 10:11 am

RelationshipEcon: Borrowing Social Currency?: Time is a critical element of productivity. How much time do we have… http://bit.ly/9reDd2

StarGazon July 7, 2010 at 10:01 am

Borrowing Social Currency? via The Relationship Economy – If I borrow money from you to pay my expenses … http://tinyurl.com/3ah2yvs

Angela Suddarth July 7, 2010 at 9:47 am

RT@JDeragon Borrowing Social Currency?:
If I borrow money from you to pay my expenses then you borrow money from … http://bit.ly/bBlIu9

JDeragon July 7, 2010 at 9:47 am

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Dan July 7, 2010 at 9:08 am

The end game should be easy to see. The whole world will just lop three 000′s off of the global balance sheet and reboot – business as usual.

If you have cash you’ll lose it bu a factor of 1000, but if you have debt, you’ll also lose that by a factor of 1000. If you have exactly the same amount of debt as you have cash, you’ll have a net zero effect. This is what’s happening today – everyone is scrambling to have the same amount of cash as debt. Too much debt and you won’t be able to pay the mortgage and you’ll go bankrupt. Too much cash and you’ll lose too much money.

That’s the end game. If you don’t see that one coming….

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