From: | Joshua N Pritikin <jpritikin(at)pobox.com> |
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Date: | Mon, 17 Jan 2011 14:37:07 -0800 |
Subject: | Re: [WDDM] Economics and Change |
If you give me a loan to eat lunch, and then I pay you back the loan, it is
self-liquidating. This is true whether I traded the loan for food, or if I
invested it in Tennis Shoes and bought food with the profit. Perhaps I
bought lunch and seventy pounds of ferret meat to sell in Elbonia. The
particulars of what I do with the capital have nothing to do with whether
the loan is self-liquidating.
If I borrow money and pay it to a worker who makes me a widget for my
nightstand... and then he buys lunch with the money, and I sell my old
widget to pay you back... self-liquidating. There are endless ways the money
could bounce around once you loan it, but if I pay it back, it is
self-liquidating...
which is a fancy way to say, people have to pay you back. Jargon.