If you owe your bank manager a thousand pounds, you are at his mercy. If you owe him a million pounds, he is at your mercy.
Interpretation
The level of debt you have to someone can determine who holds the power in a relationship.
This quote by John Maynard Keynes highlights the dynamics of power in financial relationships. It suggests that owing a smaller amount puts you in a vulnerable position, while being indebted at a larger scale can shift the balance of power, indicating that the one who owes more might have more leverage in negotiations or decisions.
In practice
This quote could be used in a financial literacy class to explain the implications of debt.
As time goes on, I get more and more convinced that the right method of investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes.
The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is generally understood. Indeed, the world is ruled by little else.
The disruptive powers of excessive national fecundity may have played a greater part in bursting the bonds of convention than either the power of ideas or the errors of autocracy.
We will not have any more crashes in our time.
This long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is long past the ocean is flat again.
The book, as it stands, seems to me to be one of the most frightful muddles I have ever read, with scarcely a sound proposition in it beginning with page 45 [Hayek provided historical background up to page 45; after that came his theoretical model], and yet it remains a book of some interest, which is likely to leave its mark on the mind of the reader. It is an extraordinary example of how, starting with a mistake, a remorseless logician can end up in bedlam.
Average investors can become experts in their own field and can pick winning stocks as effectively as Wall Street professionals by doing just a little research.
You've got to tell your money what to do or it will leave.
The propensity to swindle grows parallel with the propensity to speculate during a boom the implosion of an asset price bubble always leads to the discovery of frauds and swindles
Although it's easy to forget sometimes, a share is not a lottery ticket... it's part-ownership of a business.
I am more and more impressed with the possibilities of history's repeating itself on many different counts. You don't get very far in Wall Street with the simple, convenient conclusion that a given level of prices is not too high.
If you wait to see how much money you have left at the end of the month to put toward savings, the answer may be zero. So, set up an automated monthly transfer from your checking to savings account. Once you lock into that commitment, you'll be forced to scale back spending to make ends meet.
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