Wealth

 Random thoughts

1. Wealth can be of two types - physical and financial. Financial wealth is generally in the form of currency, stocks or bonds. Value of financial assets is dependent on underlying future cash flows and discount rates. Value of physical assets though is generally stable , for example, a land remains land forever if not valued in monetary terms but when the same physical asset is valued in monetary terms can see it's value fluctuating.  


While in earlier days, people used ro have assets in physical form such as land or gold. But with the introduction of fist currency, people have started investing in financial assets. But ultimately any investment in financial assets is somewhere investment in physical assets only. Suppose you invest in stock or bond. The investee uses the money to invest in building factory or plant & machinery. 

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