Stock Stories

Basic Idea - what gets rewarded gets repeated, regardless of any ethical considerations.  Specifically “bad money drives out good”History - named after Sir Thomas Gresham, who was an English Merchant in the 1500s.  Also attributed to Copernicus and Aristophanes.Gresham brought to public attention that, in an economic system with fake coinage, the fake coinage will drive out the real coinage in circulation.  People will keep what is valuable and spend what is not.A few ways to interpret this:Things of value will tend to become more scare, while copycats and imitators will proliferate in a given market placeSystems of morality tend to fade away when practical benefits that appeal to human nature overshadow it Example: savings and loans crisis in the 1980sInterest rates from the Federal Reserve started rising higher than the rate at which S&L’s were paying out interest on deposited funds...recipe for disasterS&Ls, instead of immediately becoming insolvent, began to invest in speculative ventures, reachin