Thursday, May 21, 2009

Game of money

Wealth is not a zero-sum game but money is a zero-sum game without a perfect strategy. In fact, we can argue that it is a negative sum game because wall street and the government take their cut in the zero sum game. In a game like tic-tac-toe, a perfect strategy exists and if you follow that strategy, you cannot loose. Games like poker and chess do not have a known perfect strategy. But, that does not mean that good strategies do not exist. Strategy must be adjusted according to the moves of other players. The most important players in the money game are the central bank and the government. The strategy must be adjusted according to their moves. When you go to a casino, you have an option of not playing and keeping the money in your pocket. But what if the casino takes away a portion of your money every hour that you do not play? Then, you will be forced to play in the casino just to break even. Welcome to the casino where the government takes away your money through inflation even if you do not play.

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