Terry Pratchett knows everything and nothing about money
Terry Pratchett came to Cambridge today to present his newest book called “Making Money”. The plot features Moist von Lipwig, Post-Master General of Ankh-Morpork and former fraudster, taking over the Royal Bank, inventing paper money and reinvigorating the economy.
Three Trinity Hall students, Bettina, Christine and me, were only waiting for about 2 hours and 30 minutes before we got to meet Terry – while about six thousand people were still standing in line behind us. Poor boy. Terry was very charming indeed and took his turn of time for each individual.
I told him that my thesis topic is related to International Finance. Now, International Finance is only interesting to few nerdy people like me. Quoting scholar Susan Emmeneger…
“…topics such as capital adequacy or credit risk modelling are brain-teasers for anyone active in the field of study, its formulas unspeakably dull for anyone else.”
Nevertheless I find Financial Markets very interesting indeed. Even more, I am convinced that often simple truths formulated by interested amateurs like Terry Pratchett are much more acurate in describing the world of finance than books written by experts on the field.
Therefore I have decided to make use of Terry’s book as much as possible by introducing some of his wisdom into my thesis. You want to have a taste for this wisdom? Well, let’s see, this is a dialogue between Moist von Lipwig and Topsy Turvey, the widow of the former chairman of the Royal Bank who has become Chairwoman of the Bank herself and teaches Moist a few lessons about how a bank works:
‘I don’t know how banks work’ [said Moist].
‘You never put money in bank?’ [said Topsy]
‘Not in, no.’
‘How do you think they work?’
‘Well, you take rich people’s money and lend it to suitable people at interest, and give as little as possible of the interest back.’
‘Yes, and what is a suitable person?’
‘Someone who can prove they don’t need the money?’
‘Oh, you cynic. But you have got the general idea.’
‘No poor people, then?’
‘Not in banks, Mr. Lipwig. No one with an income under a hundred and fifty dollars a year. That is why socks and mattresses were invented. My late husband always said that the only way to make money out of poor people is by keeping them poor. He was not, in his business life, a very nice man.’
Terry Pratchett is a nice man, though. I asked him if I could make an interview and he asked whether bankers would be really interested in his thoughts. I think so. He maybe does not know how economics work. But he knows how economists work:
Economists are like alchemists, but less messy.
