The Price of Time Quotes
by Edward Chancellor
This page collects some of the sharpest, most thought provoking lines from Edward Chancellor's book on interest rates and the nature of money. You will find quotes that range from ancient wisdom to modern financial critique, each one cutting through the noise to reveal uncomfortable truths about debt, time, and human greed.
What makes this book so quotable is its ability to turn complex economic ideas into memorable, almost aphoristic statements. Chancellor has a gift for phrasing that sticks with you, whether he is warning about the dangers of cheap money or reminiscing about the moral arguments against usury. These are lines you will want to share and think about long after you read them.
Top Quotes from The Price of Time
“A penny ... put out to 5 per cent. compound interest at our Saviour's birth, would, by this time, (that is, in 1773 years) have increased to more money than would be contained in 150 millions of globes, each equal to the earth in magnitude, and all solid gold.”
Quoting the 18th-century philosopher Richard Price to illustrate the explosive power of compounding.
The vivid imagery of an astronomically large sum of gold makes the abstract concept of compound interest tangible and astonishing. It underscores both the wonder and potential danger of compounding debts.
“Usurye is also saide to be the price of tyme, or of the delaying or forbearing of moneye.”
Thomas Wilson's definition of usury in his 1572 Discourse Upon Usury.
This early modern definition directly ties interest to the value of time, a core concept of the chapter and a precursor to modern financial theory.
“Interest, he said, is the price of time. There is no better definition.”
The author's concluding reflection on Wilson's insight, summarizing the chapter's central thesis.
It crystallizes the entire argument of the chapter in a single, elegant phrase, making it highly quotable and memorable for readers.
“The great stock-market bull seeks to condense the future into a few days, to discount the long march of history, and capture the present value of all future riches. It is his strident demand for everything right now - to own the future in money right now - that cannot tolerate even the notion of futurity - that dissolves the speculator into the psychopath.”
Author quoting James Buchan on the psychology of speculators during bubbles.
It powerfully captures the temporal distortion and dangerous desire that drives speculative manias, making it timeless.
“Cheap money is the most dangerous intoxicant known to economic life, especially if it be prolonged through many years.”
Benjamin Anderson, chief economist at Chase National Bank, warning about the 1920s boom.
The metaphor of cheap money as an intoxicant vividly conveys the addictive and destructive nature of prolonged low interest rates.
“Capitalism without bankruptcy is like Christianity without hell.”
A saying attributed to former astronaut and airline boss Frank Borman.
The aphorism uses a sharp religious analogy to underscore that failure is essential to capitalism's functioning. It is memorable, witty, and cuts to the core of the book's theme of creative destruction.
Themes Behind the Quotes
One major theme is the corrosive effect of persistently low interest rates. The quotes repeatedly warn that cheap money leads to over borrowing, asset bubbles, and economic stagnation. They argue that what seems like a stimulant becomes an intoxicant that distorts markets and encourages reckless behavior, ultimately creating more problems than it solves.
Another theme is the relationship between time and money. Interest is defined as the price of time itself, and the book explores how our impatience to own the future drives speculative manias. There is also a strong moral undercurrent, harkening back to ancient critiques of usury, and a persistent tension between paper wealth and genuine prosperity. The quotes challenge the idea that easy credit can fix debt problems and highlight the need for discipline, even if it means accepting short term pain for long term health.
Quotes by Chapter
1: Babylonian Birth
“If wealth is placed where it bears interest it comes back to you redoubled.”
Opening epigraph from an Egyptian scribe named Any, early first millennium BC.
This succinctly captures the ancient wisdom about the power of interest, setting the timeless theme of the chapter. It resonates because it frames interest as a natural, almost magical force of multiplication.
“Every rupee, Margayya felt, contained in it the seed of another rupee and the seed in it another seed and so on and on to infinity.”
From R.K. Narayan's novel 'The Financial Expert,' describing the protagonist's meditation on interest.
This poetic analogy of interest as infinite self-replication evokes the wonder and mysticism of compound growth. It resonates with anyone who has marveled at the exponential power of reinvestment.
“The Mesopotamians invented what Einstein supposedly called the eighth wonder of the world, namely compound interest.”
The author discusses the origins of compound interest in ancient Mesopotamia.
Famous attribution to Einstein makes this line memorable and widely quotable. It highlights the profound impact of compound interest as a financial concept.
2: Selling Time
“T was better to steal from the rich than to slay the poor by usury.”
St Augustine's denunciation of usury, as quoted in the chapter's overview of historical religious critiques.
This sharp moral inversion forcefully condemns usury as a form of violence against the poor, making it a memorable and provocative statement.
“Wherefore of all modes of making money this is the most unnatural.”
Aristotle in The Politics, criticizing usury as the breeding of money from money.
It encapsulates the ancient philosophical objection to interest as an unnatural and corrupt form of gain, resonating through centuries of moral debate.
3: The Lowering of Interest
“Paper wealth has multiplied while genuine wealth has stagnated.”
The author summarizes the outcome of ultra-low interest rate policies after 2008.
This line starkly contrasts the illusion of prosperity with real economic progress, capturing a core critique of modern monetary policy in a single, memorable phrase.
“But whereas the City merchant described a virtuous cycle of ever- declining rates and rising prosperity, we see a vicious cycle in which the falling rates induce stagnation.”
The author contrasts Josiah Child's optimistic view with the modern reality of low interest rates.
The parallel structure and reversal of 'virtuous cycle' into 'vicious cycle' make this a powerful rhetorical point, encapsulating the book's central argument.
“It turns out that Child was right when he claimed that low rates would beget lower rates.”
The author reflects on the self-reinforcing nature of declining interest rates.
The ironic validation of a 17th-century prediction resonates because it highlights how unintended consequences can perpetuate economic stagnation.
5: John Bull Cannot Stand Two Per Cent
“Money is not the Value for which Goods are exchanged, but the Value by which they are exchanged.”
John Law's key insight in his economic writings about the nature of money.
This elegant phrase encapsulates Law's monetary revolution, arguing that money is merely a yardstick, not an intrinsic store of value, which underpins his later experiments.
“It is unbelievable how terribly rich France now is; one hears nothing spoken of but millions ... The god Mammon is now ruling Paris.”
Madame, the Regent's mother, writing about the speculative frenzy during the Mississippi Bubble.
The line vividly captures the moral panic and material obsession of the era, personifying greed as a deity that has taken over the city.
“The printing of shares and banknotes was actually delayed because the manufacturers could not supply paper fast enough!”
Saint-Simon describing the frantic money-printing during the Mississippi Bubble.
The absurd image of paper shortage halting the creation of wealth perfectly illustrates the sheer excess and unsustainable velocity of the boom.
6: Un Petit Coup de Whisky
“Easy money is the great cause of over-borrowing.”
Opening epigraph attributed to Irving Fisher, 1933.
It succinctly pinpoints the fundamental driver of financial excess, a theme central to the chapter.
“There is nothing so unstable as a stabilized price level.”
Epigraph from James Grant, 2014, setting up the critique of price-level targeting.
The paradox captures the hidden dangers of central bank policies aimed at suppressing price fluctuations.
“The imagination of our investing public was greatly heightened by the discovery of a new phrase: discounting the future. However, a careful examination of quotations of many issues revealed that not only the future, but even the hereafter, was being discounted.”
Market analyst Max Winkler describing speculative mania in the late 1920s.
This witty observation exposes how speculative narratives inflate valuations beyond any rational horizon, a timeless warning.
7: Goodhart’s Law
“When a measure becomes a target, it ceases to be a good measure.”
Opening of the chapter, stating Goodhart's Law.
It succinctly captures the paradox of using metrics as targets, a central theme running through the chapter's analysis of monetary policy failures.
“Monetary stability is a prerequisite of price stability, and price stability is a prerequisite of financial stability.”
Anna Schwartz, co-author of The Monetary History of the United States, in 1995.
This concise dogma underpinned central bank policy for decades, but the chapter shows how its rigid application in Japan and the US led to bubbles and crises.
“Price stability, which monetary policy should aim at, is not stability at any particular point in time but rather sustainable stability that can support economic growth over the medium to long term.”
Bank of Japan officials reflecting on the lessons of the Bubble Economy.
It redefines price stability in a far-sighted way, directly challenging the short-term fixation that blinded central banks to credit and asset bubbles.
“We have attempted to lower interest rates below long-term equilibrium rates and to boost asset prices in order to stimulate demand.”
Federal Reserve Governor Donald Kohn at an FOMC meeting in March 2004.
A rare frank admission that the Fed deliberately distorted asset prices, revealing the intentional use of easy money to fuel demand—a policy that later contributed to the 2008 crisis.
8: Secular Stagnation
“You can see the computer age everywhere but in the productivity statistics.”
MIT economist Bob Solow in 1987, commenting on the lack of productivity growth despite computer advances.
It succinctly captures the paradox that technological innovation does not always immediately boost measured productivity, a key point in the secular stagnation debate.
“William Bernstein accused secular stagnationists of conflating what they couldn't conceive with that which was not possible.”
Finance writer William Bernstein criticizing the pessimism of secular stagnation proponents.
It warns against intellectual arrogance and the failure of imagination, reminding readers that past forecasts have often been wrong.
9: The Raven of Basel
“The highly abnormal is becoming uncomfortably normal.”
Claudio Borio after the October 2014 bond market flash crash.
It succinctly captures the normalization of extreme monetary policies, resonating with readers who sense that once-rare interventions have become permanent fixtures.
“If the origin of the problem was too much debt, how can a policy that encourages the private and public sectors to accumulate more debt be part of the solution?”
Borio questioning the logic of ultra-low interest rates as a cure for a debt-induced crisis.
The rhetorical question exposes the paradox at the heart of post-2008 monetary policy, making it a powerful critique that lingers in the reader's mind.
“Money is not a veil. Monetary policy is not neutral. Interest rates are not determined solely by savings and industry. Tinker with them at your peril.”
The concluding summary of Borio's views, rejecting Hume's neutrality and warning of the dangers of manipulating interest rates.
This compact manifesto distills the chapter's central argument into a memorable warning, leaving readers with a stark, quotable conclusion.
10: Unnatural Selection
“Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate ... It will purge the rottenness out of the system.”
Treasury Secretary Andrew Mellon's advice to President Hoover at the onset of the Great Depression.
This line captures the brutal logic of liquidationism with stark, rhythmic repetition. It remains a provocative and controversial statement about the cleansing role of economic crises.