Interview with Peter Koenig

People say that money is power, money is freedom, money is security, money is happiness. These are a few of the things that people say money is. But they also say money is … a medium of exchange, energy, information, existence, fortune, misfortune, evil, a burden, a source of jealousy … and much, much more. Yet if money can be so versatile to be all of these things at the same time, we may ask what is its real fundamental nature? What indeed is money?

From Peter Koenig’s Website

Peter Koenig travels widely giving seminars on money and is the author of 30 Lies About Money. Details of his events can be found at peterkoenig.typepad.com/eng/programcalendar/index.html

Below is an interview with Arthur Edwards conducted by email in connection with his upcoming seminar in Stroud. He can be contacted at pkconsulting@hotmail.com

AME: I would like to start with the first question that you ask on the poster for your event: "What is the true meaning of money?" Is this subjective or can one get really precise?

PK: This is subjective but if one is fortunate one can reach the individual's (or an organisation's, or society's) definition precisely - (the work we do in my money seminar). This definition is significant because it is the source of the (financial and other) circumstances, or more precisely the human processes which give rise to set habits and patterns, which lead to these circumstances. For happiness and satisfaction however, even more important than the content of the definition is one's own awareness of one's (subjective) definition. If one is aware of it, money is a tool for one's use. To the extent that one is unaware of it the situation reverses and one becomes driven by money ... either running after it or away from it ... without really knowing why. Most people, even those who have done lots of inner or spiritual work, are in some way either running after money or avoiding it. With the feeling that somehow and somewhere, if truth be told, money is actually running their lives. This is because they haven't yet addressed or researched the subject, are lacking the awareness. Systemically it is the interplay between individual and collective definitions, and the consciousness of them, which defines the circumstances we call "the economy". At the root are these subjective definitions, your initial question.

AME: In essence then, you want people to look at their understanding of money and to make conscious what is working in them, even "running their lives". This is a subjective element ... but isn't there also an objective one, if one takes the idea of an audit trail, for example, surely we agree that

such a thing needs to be objective? Only people who agree on a price can close a transaction, when prices are agreed, when contracts are made, they become facts, which takes them out of the realm of the psyche and into "the circumstances we call "the economy"".

PK: Objectively, it is a peculiar characteristic of money that it is both material and immaterial at the same time, obeying both the laws of matter (closed system, finite) and the laws of non-matter (open system, infinite). This simultaneity lends it its mercurial quality and makes it easy to

deceive those who are unaware or unclear about the nature of this peculiarity. As matter - notes and coin and accounts/accounting systems - money operates within a finite, closed and zero-sum system; once created and counted, assets in the system must by definition equal liabilities, credits must

equal debts, profits must equal losses. Yet at the same time money operates as non-matter within an infinite, open system which means that at any moment fresh amounts of it can be created (or destroyed) in potentially unlimited quantities. On the surface money may look and feel quite solid. Scratch the surface however and you quickly find that as an object it is threaded through with subjectivity. Comparing it with gold makes this clearer. At any point in time there is a limited amount of gold on/in the earth and to the extent that this has been mined it can be weighed/measured/located. Not so with money. Even if you found all the money in the world you would be left with the question of what it represents. But even before this, where are you going to go to find it, i.e. where is money located? If you take this inquiry to its logical end, following up on the all the places where you think you have concrete evidence of its existence, e.g. the piece of paper with symbols in ink you call your bank statement, you must come to the inevitable conclusion that the ultimate locus is - in capite - in your and other peoples’ heads!

AME: I am interested by the idea that money belongs to two worlds, a finite one and an infinite one, and that one should recognise this peculiarity rather than getting stuck in the laws of one or the other. Normal thinking describes and understands the world in terms of its finite qualities. Are

you saying that once we have left the idea behind that gold (which is weighable / measurable and locatable) or something physical and finite is the cover of money, we are no longer orientated by a finite world, but one in which reality is ultimately given by our thinking? You use the term "in capite",

which people might associate with "capital", could you say more about the origin and use of this term?

PK: You have paraphrased my conclusion very well I think. Interestingly I've just started reading philosopher Paul Feyerabend's posthumously published book "The Conquest of Abundance" and can already see he is heading towards the same conclusion. The phrase "in capite" is my own invention. Googling the word "capital" I haven't discovered that anyone else has given its origin the source I'm pretending, nonetheless find the association a nice coincidence.

AME: I think it is more than a coincidence, not only in the sense that the head is related to the way in which one becomes conscious of what one thinks but in the analogy of capital to this, the image of freed global capital and its relation to the whole economic life of the earth. One can certainly find indications of this analogy in Rudolf Steiner's monetary analysis, where he describes the headache that arises when capital that should be used up in production is instead accumulated (see extracts below). It seems that we have come from our original question "What is the true meaning of money?" to the question of "What is the true meaning of capital?" May I end by asking you that ...

PK: My definition of Capital is: a stock of something (an asset) out of which it is intended to create a stream of product in the future. Inherent in this definition are:

- The process of making a distinction, i.e. out of a flat landscape containing everything one selects/distinguishes/defines WHAT is capital, now.

- The notion of potential production/transformation. The capital is worked on/transformed. It may be a combination of assets that are worked upon.

- The element of time, because the stream of product is not present yet, but expected in the future.

I wrote the above before reading Rudolf Steiner's abstract below, but see that our thoughts are compatible, particularly that of capital being something that is used up/transformed (and if returned to its original state, maybe only after a long cycle). This applies not just to physical matter, as I see it, but also to ideas - which also get used up. There is therefore something unnatural about the idea of financial "Capital" producing an income stream but remaining existent and NOT being used up, the

general assumption in the financial marketplace. One could see this as either producing a headache as Steiner suggests, or being a misnomer/a self-delusion as I'd suggest, but leading to the same point.

The analogy of capital to the realm of the head:

From Rudolf Steiner's 1922 Economics Course (New Economy Press - 1996 / www.cfae.biz), lectures 4 and 5.

This is simply the circulation of capital - nothing else. But this circulation is part and parcel of a social organic activity, just as you have the blood in a human or animal organic activity, when it flows through the head and is used for what the head produces.

...

It can only be brought about, however, if the whole economic process from beginning to end - right up to its return to land - is ordered rightly. There must be something there like the "self-regulator" in the human organism. The human organism, at any rate when it is functioning normally, manages to prevent promiscuous deposits of unused foodstuffs. And if unused foodstuffs are deposited here or there, we are ill. Suppose, for instance, that in the process of digestion in the head, substances are deposited, that is to say, an irregular digestive process arises in the head. The substances are no longer carried away; their consumption is not properly regulated. Then we get migraine conditions. In like manner, you

will see the same principle at work in all parts of the human organism; the cause of morbid symptoms lies in the inadequate absorption and removal of what has to be digested. It is just the same in the social organism, when that which ought really to be used up at a certain point becomes accumulated. It is

a matter of sheer necessity for capital to be used up along here (see iv in diagram), in order that it may not unite with land and so become unliving - as if a petrified deposit in the economic process. For capitalised land is indeed an impossible deposit in the economic process.