#1 seed: Thinking about debt

“Your beliefs become your thoughts,
Your thoughts become your words,
Your words become your actions,
Your actions become your habits,
Your habits become your values,
Your values become your destiny.”

― Mahatma Gandhi

As Year of Fire Monkey approaching, I want to add new meaningful habit to my life. In 2014, I started taking piano course following my sister advice as I felt the need to have some sort of emotional outlet. While in 2015, I started swimming daily as I felt the sedentary lifestyle being an office worker started taking its toll on my physical fitness. In addition, thanks to my colleague Rony who emphasized the necessity to refresh our intellects regularly, I started listening to podcasts during stressful commuting time (my current favorites are Freakonomics99 Percent Invisible, and Surprisingly Awesome), and subscribed to several magazines i.e. Harvard Business Review and The Economist. This year, I will give ‘writing’ another shot!

As a starter, I am going to write about debt. Not a common topic to write about you might think and definitely not a favorite topic to discuss especially two days before the auspicious Chinese New Year.  If you, however, have listened to one of Surprisingly Awesome’s podcast titled “Interest rates”, you will learn how debt and its inseparable attribute ‘interest rate’ are fundamental parts of human being.  In fact, the very first writing that appeared 5,000 years ago in ancient Sumer were essentially about interest rate. The idea of debt, credit, loan, interest rate, etc. which appeared on that writing had developed so fully, that some experts started positing theory that writing was originated from the necessity to keep track of all the loans and the interest charge.

Fast forward to 21st century, even Ray Dalio, founder of the largest hedge fund manager in the world who successfully predicted Global Financial Crisis in 2007, also puts a huge emphasize on debt cycle (both short-term and long-term) to understand how the world economy actually works. Fortunately, he shared his logic and way of thinking on how the economic machine works?”. (Check his 30-min seemingly simple video and full-blown research paper on the issue).

2016-02-06 12_27_37-How the Economic Machine Works [Animation] by Ray Dalio
Productivity, Short-term Debt Cycle, Long-term Debt Cycle graph taken from “How The Economic Machine Works?”

While in Buddhist philosophy, it is said that freedom from debt (anana-sukha) is one of four kinds of happiness that can be had by layman leading ordinary household life.

Looking at how relevant and encompassing the debt is, I believe debt is an appropriate subject to think and write about and hopefully we can gain some insights as we explore the realm of debt further.

PS: For those who are currently having mountain of debt, you should think more on ways to repay those debt instead. 🙂