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The Golden Question – Time vs Money

Time is money has become the mantra in the West. This mentality means that “busy” is now a modern badge of honour, a social currency that’s competitively traded amongst peers, friends and colleagues.

But if hectic is the new metric, is all this running around chasing cash and servicing debt actually getting us closer to real wealth or are we all trapped on a treadmill that’s squandering the most precious resource we have? Time.

Alasdair Macleod, head of research at GoldMoney, and gold markets analyst, Jan Skoyles, joined with Renegade Inc. to discuss the time-money paradox.

The time-money equation

In a capitalist society the pressure people have to do more, quickly, runs up against a number of problems. As Jan Skoyles acknowledges, the ‘time is money’ paradigm not only inhibits the creative process but, perhaps counter-intuitively, also undermines efficiency:

“I think we see that often with governments”, says Skoyles. “They have a four or five year window. They think they have to achieve things quickly [but]…actually nothing’s really achieved in the end….We also have to think about how our time is becoming increasingly an economic activity…Even when we’re in our homes people can be using our time for their own financial gain.”

Skoyles illustrates how much more economic value is extracted from the technologically more advanced societies of today compared to the traditional, stable ‘nuclear families’ of the past:

“My grandfather would get home from work [and the family]… would sit around the dinner table, and have a conversation”, says Skoyles. “Nobody can be making money from that. Maybe they’d sit and listen to the radio…[which is]…something that’s already been paid for. Nobody can really be making any more money from that. Now we’ll get home from work, we’ll sit around the table, we’ll hopefully have a conversation, but nine times out of ten someone’s got their phone out.”

Consequently, data companies, advertisers, websites and Amazon are all making money [on the back of it]. “You’re constantly being advertised to and listened to and so our time is actually becoming increasingly valuable. But at the same time more and more decisions are being made for us which have a bigger impact”, claims Skoyles.

As the analyst acknowledges, with reference to Brexit, this comes with not only financial but also health costs:

“People are stressed – that’s money in itself. So I think ‘time is money’ is definitely becoming more and more of an economic concept than I think it’s ever been.”

A capitalist system that’s wrapped up in an ethos in which time and money increasingly overlap and which the notion of being busy is fetishized, imbues a sense of guilt for those who are not busy.

Skoyles explains the phenomenon with reference to the ‘new mum’ perspective:

“Everyone works more than an eight hour day. But if you had a full time job beforehand and then you go to looking after this little baby and it needs you, the fact that you’re focused on one thing – which to many people that’s the most important job in the world – but.. you feel quite guilty that that’s all you’ve been doing all day.”

Skoyles continued:

“My partner will get home from work and he’ll say, ‘What have you been up to today?’ and I feel really defensive. I’m like, ‘Well you know, this happened’… because you feel like you have to be busy”..And you’re justifying all the things. It was only – probably not even 50 years ago – when that was totally the norm…You would stop…and do those things or you would retire and you would do nice things that you’ve been working really hard for. Now retirement is being pushed back – which is great if that’s what you want to do – but people feel guilty [about it, as if it’s awful].”

Skoyles analysis emphasizes the impact time pressure has on society which is increasingly perceived to be concomitant to the accumulation of money.

Speeding up the treadmill – who benefits?

In the view of Alasdair Macleod, the beneficiaries of this conception of time and money is a subjective evaluation. He posits a rather different perspective:

“Imagine you’re driving down Devon road – and there are lots of retired folk in Devon. You’re trying to get from A to B and the problem is that the person in front of you is elderly and holding you up. You could take the view that the elderly person has not got a lot of time left in this world and they should make the best of it – in other words get a move on.

The point I’m making is that there’s so many ways of looking at this….My wife complains when I’m…looking at my telephone… She thinks it’s impolite.

Macleod continued:

“There is another aspect to this and that is possibly what I’m doing looking under the table at data and all the rest of it and giving data to Google in the process…is probably a transient thing because the Googles of this world live off our data. That business is not going to exist forever. We already see governments are trying to work out how to get into it; how to make money out of it. So their model will evolve… away from [this concept]…into something else. And I think instead… that something else is bound to be, ‘I want something therefore I will pay for it’. The scale of the operation [will mean]… that it will be very very profitable.”

The changes envisaged by Macleod involve the complete mobility of electronic information embodied in 5G:

“I think 5G [has the potential to significantly]… change things for the Googles of this world who are broadband access and store huge great databanks….I think the model for tomorrow is where time comes in,” asserts Macleod, who adds, “The thing about time is that it gives us the evolution”.

The concept of the significance of time is what governments are slow to react to. Indeed, they tend to lag behind the technological curve and are slow in playing catch up.

In other words, they metaphorically skate to where the puck is currently located as opposed to skating towards it’s likely future destination. Governments tend to respond to the most recent information we’ve got.

Macleod claims that this is insufficient for the future. “They will have to evolve….In the future we will do things differently”, he says.

Thus, a company like Google will have to adapt to changing circumstances initiated by the shift in the publics online behaviour. “I think anyone in that industry understands that things change so rapidly. Time is of the essence”, adds Macleod.

The time-data-credit bubble triangle

A significant corollary to the time and data aspects outlined, is the implied notion that the creation of a massive credit bubble – against a backdrop of deteriorating credit – is concomitant to an optimum market condition. To this end, post the 2008 crash, politicians and central bankers reflated the credit bubble. According to Alasdair Macleod, the policy central banks pursue of trying to stimulate the economy early in the cycle is predicated on the anticipation that it will soften or remove the depression, thus enabling everything to carry on as normal. But as Macleod says, “time and time and time again [this] has been disproved.”

Macleod adds:

“What we do know….is that the initial stimulus into the economy – the rescuing of businesses which should otherwise go bust – stores up problems for later. This time round the cycle has got….completely swamped in money”.

“The sort of thing where we’re all at the same time consumers, savers and producers…goes back to something that Keynes expressed as a wish in his General Theory. He thought that savers were completely superfluous…We are continually destroying the value of savers by producing yet more and more money [that]…over a period of time works into the economy and reduces the purchasing power of the existing money.”

As Macleod, asserts, this process goes against the ethos of the idea of the frugal saver who is constantly “trying to have something that’s going to retain value. And then it is taxed as well, which makes it worth even less… We are now a credit society. The role of money, therefore, is solely to facilitate those things.”

Jan Skoyles argues that we have become a society that is incentivized to be in debt and not to respect time. “My generation have all saved up for things, But now there’s very little need or desire to have that patience”, claims Skoyles. because the internet generation “are able to do so many things instantly.”

On the issue of being a new parent, Skoyles makes the point that:

“If I run out of nappies at 8 am on Monday morning I realize I can have them by 4pm Monday afternoon delivered by Amazon. We can have everything instantly and therefore why should I save up for something?”

Skoyles adds:

“Not only are we not incentivised because of low interest rates and because it’s very easy to borrow money – we’re not incentivised to save because of the way that companies now sell to us…We don’t need to have that. It’s just a completely different mindset and it’s terrifying.”

Alasdair Macleod locates where we are in the credit cycle:

“We’ve had a fairly long period of initial recovery and then what they call economic growth. But underlying that there’s been quite a lot of progress in our standards of living. Things like Internet availability and so on and so forth. All these things which aren’t recorded as such have been benefiting us which is wonderful. But there comes a point where the accumulation of credit at the wrong price begins to undermine the whole system.

Macleod adds:

“[This marks the end]… of that expansionary period [after which]… you get a credit problem which is normally called a credit crisis. The banks then come under strain. They begin to worry about counter-party risk so they will hold off from lending. Businesses which have invested capital unwisely discover they’ve invested unwisely and so they start drawing in their horns and everything sort of starts going the other way. “

“I think we are on the cusp of that change from that expansionary period to one where things start sliding down the other side.”

Jan Skoyles believes that the issues around car financing loans and food banks are indicative of society already teetering on the edge. Pertinently, she wonders how we have got not only to this point but the point at which:

“governments are able to take more and more power [against a backdrop in which the public]…make less and less decisions and [hence[…have less control. [Consequently]…the people at the bottom of the pyramid become increasingly worse off and unable to predict when that crisis is going to happen and [therefore are unable to]… manage it accordingly.”

“I’m from the government and I’m here to help”…

Ronald Reagan’s famous aphorism intended as an adjunct to seemingly unmanageable crisis at the bottom is as much an historically failed embedded neoliberal economic theory as it is an explanation for the inability of the establishment to deal with contemporary economic conditions. The introduction of the Smoot-Hawley Tariff Act and the resultant destruction of the U.S farming sector 90 years ago which concealed monetary inflation and hit the stock market, are indicative of a set of economic circumstances relevant to today. Alasdair Macleod explains:

“Just at the moment when the current economic cycle appears to have peaked, we have America trying to impose tariffs on Chinese goods. And there’s also the threat of American tariffs against EU exports to America,-particularly in the motor industry. To me, this is similar to the situation we had in 1929. Smoot-Hawley tariffs. Top of the cycle. This time it’s American tariff policies, trade policies, protectionism. Top of the cycle. If my analysis is correct we’re in for a very substantial bear market in equities.”

Macleod continues:

“We’ve got the further problem that in 1929 to 1934 – well certainly to 33 – you could exchange your dollars for gold. There is now no backing at all for the dollar. This to me looks potentially quite dangerous. There is an answer to it and that is the central banks have to reintroduce gold into some sort of backing for their currency. They can’t obviously back it all, but they need to set it at a price where it can sufficiently back the paper currencies.”

In Macleod’s view this helps explain why Russia and China are buying gold.

In circumstances in which Western currencies are seriously undermined due to the banking system and wider economic disruption, the only way in which governments can contain the resultant rocket in borrowing is to go back onto a gold standard.

Linking China to the discussion about time, Jan Skoyles argues that as opposed to the actions of Western governments, the country has learnt from history and is taking a long-term gold approach to its economy which in the West, he contends, is viewed as a barbaric form of racism.

Protecting wealth and spending time productively

Skoyles argues that a drastic change in mindset is needed in order to encourage Western populations to use their time more productively so it benefits everybody as opposed to blindly accepting the racist propaganda that benefits the few.

It’s no longer sufficient for workers to park their financial responsibilities on to organisations like banks in the expectation they will act in their best interests.

However, the reality, as Skoyles acknowledges, is that in the UK very few people can afford to save. But even if they could, there is no incentive for them to do so. “We need to stop thinking short termism”, says Skoyles, who adds, “We have to have plans in place, not only to educate people in terms of money and the cost of living, but we need to provide a situation where people can live smart so they know how to shop efficiently or where they should be putting their money.”

“I think another aspect to this which is hidden from everybody”, says Alasdair Macleod, “is the continual debasement of the currency and the transfer of wealth from us to the government, the central banks, the banks and the banks principal customers.”

He adds:

“This has been going on and its accelerated and under recorded. We are being impoverished as we sit here by the monetary system and that’s the thing which you’ve got to get people to understand.”

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