The Scandal of Financial Nihilism
The Wheels Keep on Turning—and the anti-mimetic breaks are breaking.
“It is because you don't know the end and purpose of things that you think the wicked and the criminal have power and happiness.” — Boethius, On the Consolation of Philosophy
Nobody has a precise idea how much wealth anyone else has. There is a good chance that you don’t even know your own. We are all engaged in an elaborate game of assumptions, even about our own future.
The fact that men are posting gain and loss porn on Reddit is not a sign of transparency, but opacity. The narratives only go skin deep.
Beneath the narratives, people are silently crying out for order—a link between cause and effect, or some indication that hard work still matters, or the assurance that they will be rewarded for good decisions and not for reckless ones.
When you make and/or lose a lot of money quickly, without the ability to see exactly why and how the windfall or bust happened, it can lead to financial nihilism. When you see—or think you see—other people doing the same, it can lead to financial nihilism. When you work very hard and do All the Right Things (as Dave Ramsey, or some other financial guru, would have you do) and then proceed to lose most of your net worth in the course of a month due to unexpected circumstances, it can lead to financial nihilism.
There are a few different ways of defining this particular form of nihilism. Each of them points to a different aspect of it.
My friend Demetri Kofinas has referred to financial nihilism as “a philosophy that treats the objects of speculation as though they were intrinsically worthless.” It is a philosophy that fully embraces the view that reality is completely subjective. I should note that the Subjective Theory of Value in economics does not, in any way, imply that reality itself is subjective—but rather that subjects determine the value of an object, and ultimately its price, through their collective decisions. Each of these actors could be acting with a greater or lesser vision of and adherence to reality. But for the financial nihilist, the subjective completely subsumes the objective. The truth is that both exist. For example: beauty, at least classically understood, is objective—it has certain characteristics, like claritas (clarity), consonantia (proportion), integritas (integrity/coherence)—but I perceive it subjectively. Conflating the two leads to problems.
Financial nihilism is usually downstream from ontological nihilism. I don’t think people are nihilistic in a domain-specific sense; I believe that nihilism is diffusive and easily bleeds over into all aspects of life, from relationships to one’s health. (For instance: you hear about a friend who takes extremely good care of himself but is nevertheless unexpectedly diagnosed with cancer, and so you think: ‘screw it, what’s the use of this discipline?’). We have entered a truly nihilistic age, which is reflected in our politics as much if not more than our markets. It’s as if it doesn’t actually matter what people say or do anymore. This spirit of political nihilism was summed up by Donald Trump saying “I could stand in the middle of Fifth Avenue and shoot somebody, and I wouldn't lose any voters, OK? It's, like, incredible." Yes, it is incredible. And that’s why politics is no longer credible. Nihilism, like all of life, ultimately comes down to the fundamental question of belief. People don’t know who they can trust or who they can believe in, but they must believe in something.
There is a time-bound aspect to financial nihilism. If in one second you can lose or make a lot of money in a manner that feels completely detached from any amount of “value” that you believe you created (the idea that all people who have money must have created a ton of “value” is problematic, because most people don’t understand what value means in this specific case—which is subjective value), then you begin to get the sense that the quality of your work has no connection to what people will pay for it, or to financial success. Not even your intelligence can save you. You can analyze a single stock for six months (as one long-only hedge fund manager told me) and buy it with a complete conviction that it’s undervalued, and then watch as it loses 80% in the course of a single year. If the bears are making money based purely on mimesis and momentum, what’s the use of pouring yourself out doing analysis for 40+ hours? Eventually, you come to place here you simply wait, second by second, to see if anything changes. Having lost a firm belief in your own agency, you place bets, you wait, you see what happens. If nothing matters, then what good is there in being good? Abandonment to non-divine providence is the only thing left.
If you’re unable to transcend the transactional—to exit the logic of the game (the gamification of the stock market, the NFT swindles, the latest crypto narrative)—you simply enter deeply into it for fear of being left out or left behind. The small amount of nihilism that led to your decision to play breeds more nihilism once you’re deep inside of the game. Now, in the moment, you may feel that you truly believe in the game, but you don’t really. You can’t even be an honest nihilist because you have had to make friends with dishonest wealth.
Lastly, a financial nihilist can be described as someone who has no skin in the game.
No doubt we could list more, but I’ll leave it at that for now.
Financial nihilism comes down to an even more fundamental problem. It is an epistemic problem. Many people simply see nothing worth believing in and so they are, in the words of Neil Postman, amusing themselves to death.
Unfortunately, I think it’s even darker than that. Financial nihilism very often stems from a basic (unacknowledged) belief that life is simply not worth living.
If we’re bankrupt a few years from now, who cares? We don’t want to be here in the first place.
If a person lacks the will to live and engage deeply with the world, what is there to fear about financial loss? The pain of loss may in fact be the only way they have left to feel anything at all.
Nihilism lies at the heart of many of our health problems, political problems, and relationship problems. When there is no hope for the future, why do we expect people to care about decisions that affect the future? For lack of vision people perish.
Lastly, we lack a rich understanding of the difference between wealth and money. Wealth, as Paul Graham has written, is what we want: food, clothes, a home, the ability to travel and learn about the world, and so forth. Money is simply a system we’ve devised for helping us get the things that we want, or think we want, in a specialized world.
Obviously, though, we want much more than food, clothes, houses, cars, and things. We want loving relationships, lives full of beauty, nourishing conversations, and many more immaterial things that we often say we “can’t put a price on.”
But of course we can. How much would you pay, right now, to be magically transported to a wonderful meal with a handful of wise people who are interested in you and wanted to engage in conversation about all of the topics that were most important to you? I would pay a handsome price.
I can’t buy that, though. Nobody can.
(Some extraordinarily rich people do attempt to buy these kinds of experiences and relationships, but those purchases carry one big caveat: genuine, loving care and attention is not something anyone can buy. Many extremely rich people go their entire lives wondering if anyone is really their friend—someone interested in them for who they are, rather than their bank account. I can’t imagine that kind of existential loneliness on account of money.)
What I can do, though, is invest in things that I feel matter—and resist the temptation to invest in things that I don’t think matter merely so that I’m part of the game. I can refuse to play a nihilistic game. That is one freedom that each of has. We get to choose.
Financial nihilists of the speculative variety aren’t necessarily greedy people who seek money at all costs. They are people who have ceased to believe that money means anything—so it ends up meaning everything.
The financial nihilists actually have something right: money doesn’t matter as much as most people think it does. Their downfall is their inability to believe that a greater reality exists for which money is simply one layer. The economic layer is an important layer, no doubt, but it is not the Layer Zero of life.
If money is ordered to nothing else, then it becomes ordered to itself—to its own propagation and self-replication. And that is precisely the definition of a meme. That is why we have a meme market and a meme economy.
When I was a kid, I begged my parents for a Nintendo Entertain System for well over two years before they finally gave in. Well, my dad gave in.
All of my friends had one. My mimetic desire was raging.
One day, I sat down and made a list of “100 reasons why I should have a Nintendo.” (A miraculous accomplishment, when I think about it). I wish it was still around somewhere because it would be hilarious to read. I would’ve gladly posted it here for your amusement.
I don’t remember a single item on the list, but I know that I came up with 100. I’m sure some of them were noble (I had pledged to buy learning games that would help develop my brain—that much I do remember). But many of my “reasons” were likely suspect, to say the least.
My dad took one look at the list and decided that he had had enough. It was not that the list had convinced him that I should have a Nintendo. I can’t imagine that it was all that persuasive. It was the fact that I had actually taken the time to make it. He just couldn’t take it anymore. I think he thought that his kid, his only son and only child, had finally lost it.
He told me to get in the car and drove me to the nearest Best Buy where he bought me a Nintendo and told me to pick out three games (I would’ve been happy with one). When he got home, he got in a little spat with my mom who couldn’t believe that he had succumbed.
I started feeling bad. Had I manipulated him into buying it for me? My dad was a truck driver. He worked his ass off for every penny he ever made. He had no idea what a Nintendo even was.
After seeing my mom’s concern, and my own distress, my dad turned to me and said:
“Son, it’s only money.” He smiled, sat down, cracked open a beer, and started watching a Detroit Tigers game.
I’ve never forgotten that.
My dad wasn’t a financial nihilist. He—perhaps more than anybody I’ve ever known—knew what money is. It was something real to him because it led to, or made possible, real things.
But he had perspective, and he had order. He could say “it’s only money” without a hint of the cool cynicism of the man who blows his Bitcoin windfall on a new car that he doesn’t need. My dad said “it’s only money” because he secretly knew that he was wealthy.