Think Twice Before Parking

496. Join me in inspiring truly powerful people. Each day I will add a new thought, story or idea to support your quest and mine.

Years ago I consulted with some financial guys. They wanted to know about story. They wanted to know how to tell a better story. Before I could teach them about story I needed to know the story they were currently telling. My friends call me a “circular” thinker so I imagine outside eyes would have seen a brilliant comedy routine: several “linear” financial thinkers trying to squeeze my circular mind through their two-dimensional picture. I knit my brows so many times they were bruised. When I am older I will have deep furrows cut in the field of my forehead from that difficult day.
Although I had to squeeze my thoughts across the chasm I was able to finally grasp their story. Here’s what I learned: Money needs to move to grow. Our entire system is designed to entice the average Joe to “park” their money in a bank or a 401k or an insurance product. Most of us still imagine that our money goes into an impenetrable vault; the money goes into the vault and is safe, secure and the nice banker/broker will pay us a tiny percentage to keep our money parked in their vault. That image is a carefully crafted illusion to make us feel secure and grateful for the return on our parking job.

Their job is to make the money move. And they make it move a lot. There isn’t a vault, there is no parking lot; there’s a racetrack. They make the money make lots and lots of money because it never sits still. They will make your money grow 7 to 10 times larger than the amount you parked in their lot-illusion. But wait, there’s more: even it they lose the money they have a fail-safe built into the program; it’s not their money being lost, it’s yours. They were very serious when they said to me, “You never work with your own money.”

Here’s the core of their story, the story beneath the story. It is finance 101: their job is to keep you and me on one side of the debt line (we pay the interest) with them on the other side of the debt line (they receive the interest). They need to create debt for us to pay (think credit card, mortgage, student loan). As they said, “Debt is not a bad thing, it just depends upon which side of the debt you are standing.” That’s why crashes like the 2008 disaster made money, lots and lots of money for some well positioned financial guys: They created lots of good debt and it wasn’t their life savings that they gambled away. They play a game in which they win either way and, in the story they told me, are careful not to consider the consequences for others.

I was not much help that day. I couldn’t get over the notion that it was not a better story that they needed but a better intention, perhaps a bigger conscience, or maybe even a better understanding of the word community.

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