Investing: the Curse of Meritocracy

Investing is unfortunately a necessity nowadays to keep your money from melting away due to inflation.

In theory, the purpose of inflation is to incentivize individuals to spend their money into the economy rather than hoarding it. Over time, those who allocate their capital into smart and useful endeavors like businesses end up wealthy.

This is generally considered a good outcome especially when contrasted with the market failures of Communism in the former Soviet Union and in China during the 1960s.

Those who know how to best use money for the greater good end up having the money. It’s a hyper efficient meritocracy that transcends arbitrary boundaries like nobility, caste systems, and bureaucracies. It allows us to create and consume a lot of Stuff.

However, it also creates a societal pressure that slowly but surely takes away agency from those who exhibit virtues that cannot be precisely measured.

It’s sucks up the agency of those who keep society running and worth living in such as artists, musicians, teachers, soldiers, and transfers it into the pockets of bean counters.

It also creates a mathematically inescapable form of inequality by democratizing the power of exponential growth.

Personally, I hated the world of finance and investing for a very long time. It all seemed like zero-sum bullshit games to me. However more and more I realize that understanding how money works is crucial to modern life.

Many retail investors understand this too, that’s likely why so many are drawn to meme stocks and places like r/wallstreetbets. It’s the intuitive feeling that something isn’t right and that the only way to escape into a better life is to harness the magic of money.

With Theory A, my hope is to offer an alternative method of understanding money that explains why this intuition is true but also a way of solving the issue that doesn’t boil down to gambling.