IN DEBT WE TRUST

“Liquidity” was defined after a trader tried to sell a castle quickly. Turns out stone is not liquid.

✗ FAKE
Liquidity in finance means how easily an asset can be turned into cash without changing its price. The term was not defined after a trader tried to sell a castle.

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The first mutual fund was a friendship pact: “we lose together.” Community, but expensive.The first credit limit was determined by how much a banker liked your haircut.The first “interest-only” loan was invented by someone who hated consequences. Temporarily iconic, permanently risky.The Laffer Curve illustrates the relationship between tax rates and tax revenue. Politicians use it mostly as modern art.The 2008 financial crisis was triggered by the collapse of mortgage-backed securities. Or as Wall Street called it, “Oops.”The first financial crisis started when someone said “this can’t possibly go wrong.” It went wrong immediately.See all In Debt We Trust facts →

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