What Happens if you Played Real Life Monopoly with Fiat Currency and Inflation?
People talk about successful property investors as ‘playing real life monopoly’.
You can see what they mean when they say that, but there are a few extra elements in real life that Monopoly the board game overlooks.
What is real money?
Imagine we were to ask someone about money. Say you get a child and put three things in front of them. A gold coin from the 1800s; a $100 note that we can use to buy lots of things from the shop today; and then a monopoly note. Which one of them has real value? Most people will say the $100 note, because you can take it and use it to go and buy something.
But that’s not right. The one that stands out is the chunk of gold, because that’s got some precious metal with real value behind it. The other two are just pieces of paper with numbers printed on them. One of those people accept as money and the other as a board game part.
It makes you wonder, is Monopoly just training us, brainwashing us even, that we’ve got to accept and use worthless pieces of paper as money? That if you step out of line, you’ve got to go to jail? That if you pay your taxes and don’t stray too far out of line you might be able to pick up a couple of properties along the way? And that you’ll do alright if you become a good taxpaying member of the system.
But what about the two missing elements?
There are two crucial things that are missing from monopoly:
1. Real money
There is none. Monopoly is teaching us to fall into line with the concept of earning, having and using paper money. But that system is dying. And the reason it is dying also happens to be the other element missing from the board game. The second-most important ingredient, which wasn’t around when they first started the fiat, debt-based, paper currency system… inflation.
If you were to add in inflation and real money, the game Monopoly would not work the way it does and people would see it’s nothing but a game with no relevance to reality.
We could make a 2021 version of monopoly, which has got 10% inflation included. And then we could build a 2030 version of monopoly, which might have 100% inflation per day. Inflation is where the fun is at. A lot of people get fearful about inflation because they don’t have enough assets.
But let’s just say you go around the monopoly board and print off more paper money every time you’re about to lose, you will clean up all of the assets on the table. With all the extra money printed, the value of the assets would benefit as the value of the money itself diminished. Just like real life.
Play your own game
If you thought of the above hypothetical, but substituted paper money for debt, it makes sense to go around the table getting as much of the debt as you can. That way you can clean up all the assets and win the game.
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