The Ever-Changing Shape of Capital

In the history of humanity, what is considered “capital” has changed many times. More importantly, the relative value of this “capital” has…

In the history of humanity, what is considered “capital” has changed many times. More importantly, the relative value of this “capital” has also changed dramatically.

I work in private equity. I need to be very aware of capital and always be on my feet because capital looks are constantly changing. Not understanding and not recognizing worth can be a huge mistake for any investor.

photo by Karolina Grabowska

In an agricultural economy, before industrialization, more hands meant more production. It used to be that having children was an excellent way to “capitalize” your farm — especially if you had boys. There was so much work to do by hand that farmers would have many children, hoping that they could work and produce more than what it cost for them to eat as they grew up. Modernized farmers don’t have an economic reason to have many children because they work using machines. Children used to be a form of “capital” for their parents; they are not anymore in most cases.

There has been a si…