Financial Literacy

Dear James, Daniel and Emily

I sincerely hope that you all will be able to answer the questions here. I think a knowledge of financial matters is very important. Growing up my parents were very forthcoming on financial matters, and while that didn't stop me from spending foolishly at times it kept me from making any monster errors in judgement. It is very important to maintain a sense of financial perspective. James I know you are already on a good start, you understand the concept of money, you know you have to work for it generally, and you understand the concept of saving.

Some of the comments that people made on this article were good as well, the best one, that repeated the most, was that much of this is an understanding of basic math. And I think you all will get that understanding, because while I am no math genius (I have the grade reports to back that up), I am pretty good at the basic math that is involved here. And your Mom is even better at this type of thing than I am. And of course we can always fall back on Grandma Lolly or Uncle Dave if the math gets too hairy.

But the key concepts that this article focuses on do not require a sophisticated knowledge of advanced math. The basic concepts of Supply and Demand and Market forces do not require math knowledge. And a knowledge of market forces and Supply and Demand will make your life much simpler. This year, when the price of gas went through the roof, the general public (and even I for a time) felt that it was a matter of the large oil companies screwing the buying public and many major political figures bought into that as well. But after some thinking, and reading I realized that all that was really happening was that the price of gasoline in the United States finally caught up to the rest of the world. And this was just a matter of a market correction and supply & demand.

So many of the big political discussions come down to financial questions, and a knowledge of these economic forces and basic finance will allow you to see through and understand what the politicians are really asking you for. So a sound knowledge of finance and economics is good for your personal finances and also good for you to fill your spot in the body politic.