09
Sep
2011
admin

Why spending money is good

You might think that spending is silly. Clever people don't spend, clever people invest. But life is not as simple as that.

There are two distinct types of people - if given a choice, some of them can delay eating of candy if they gonna get two more later. Others eat it straight away.
And please note that a notion of food is not really my point, it is used as a notion of immediate or delayed reward.

I can tell you that both of the types behaving properly. In other words, sometimes taking immediate rewards is better than waiting for more reward later.
It all depends. Because of the different situations, you might not get ANY reward later. And that info is not available, or it is not correct.

So in this situation spending person might get more benefit than saver, and the other way round. For example, saver dies and all his money is never used. There might be an inflation and erode your money.
Also, you have to spend money if you run business.
On the other hand, spender will never have a lot of money. He can win a million and lose it in one year.

Now from the social point of view.
Saver is doing a harm for the society. He is selfish and keeps more money than others, instead of sharing it. There's no benefit for the society if you leave your money for rats dinner under your bed.
Spender is giving his money to others,and, therefore, benefit the economy. Share it with society ! He is probably giving away some free drinks as well.

So, as you can see, the saver is selfish and harmful for the society.
But both savers and spenders usually manage to survive by limiting their instincts.

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