Broken Money by Lyn Alden

The Big Idea: Modern money is structurally broken because it no longer functions as a neutral, reliable information system – causing compounding distortions in wealth, governance, technology, and social stability.

Chapter 1: What Is Money, Really?

[CONCEPT] Money is fundamentally a ledger: a system for tracking who owes what to whom across time.
[CONCEPT] All money systems balance three forces: portability, durability, and verifiability.
[CONCEPT] When money breaks, societies don’t collapse immediately—they slowly distort.
[ACTION] Stop thinking of money as “cash” or “currency” and start thinking of it as information.
[ACTION] Ask: Who controls the ledger? Who can rewrite it?
[ACTION] Evaluate assets by how well they preserve information across decades.

Chapter 2: Barter, Trust, and Early Ledgers

[CONCEPT] Early money systems (clay tablets, tally sticks) preceded coins and banks.
[CONCEPT] Trust was embedded socially before it was abstracted institutionally.
[CONCEPT] Centralized ledgers arise when scale outgrows interpersonal trust.
[ACTION] Notice how modern systems re-centralize trust through institutions instead of relationships.
[ACTION] Study historical money failures for patterns, not outcomes.
[ACTION] Treat “trust” as a design constraint, not a moral virtue.

Chapter 3: The Emergence of Hard Money

[CONCEPT] Gold and silver succeeded because they minimized counterparty risk.
[CONCEPT] Hard money systems constrain political power by limiting discretionary issuance.
[CONCEPT] Scarcity was physical, not policy-driven.
[ACTION] Understand why scarcity that depends on restraint eventually fails.
[ACTION] Separate “store of value” from “medium of exchange” in your thinking.
[ACTION] Ask whether scarcity is enforceable without trust.

Chapter 4: Banking, Credit, and Layered Claims

[CONCEPT] Banking introduced abstraction: claims layered on top of base money.
[CONCEPT] Credit accelerates growth, but increases fragility.
[CONCEPT] Mismatches between short-term liabilities and long-term assets are systemic, not accidental.
[ACTION] Learn where your assets sit in the capital stack.
[ACTION] Avoid confusing liquidity with solvency.
[ACTION] Stress-test assumptions about access during crises.

Chapter 5: The Gold Standard’s Hidden Weakness

[CONCEPT] Gold standards fail not because of gold, but because of political pressure.
[CONCEPT] Wars consistently break hard-money regimes.
[CONCEPT] Convertibility promises are the first casualty of emergency.
[ACTION] Assume convertibility clauses fail in true stress scenarios.
[ACTION] Recognize that “temporary” measures rarely reverse.
[ACTION] Watch incentives, not declarations.

Chapter 6: Fiat Money and Elastic Supply

[CONCEPT] Fiat money enables rapid response but erodes long-term trust.
[CONCEPT] Inflation is not just price increases. It is signal corruption.
[CONCEPT] Savers become involuntary risk-takers.
[ACTION] Measure inflation by asset prices, not CPI alone.
[ACTION] Adjust personal discount rates upward.
[ACTION] Treat cash as a short-duration instrument.

Chapter 7: The Eurodollar System

[CONCEPT] Most dollars exist outside the U.S. banking system.
[CONCEPT] The global dollar system is privately created but publicly backstopped.
[CONCEPT] This creates hidden fragility and geopolitical leverage.
[ACTION] Understand where dollar liquidity actually comes from.
[ACTION] Track offshore dollar stress indicators.
[ACTION] Don’t confuse sovereignty with control.

Chapter 8: Financialization and Asset Inflation

[CONCEPT] Broken money channels capital into assets instead of productivity.
[CONCEPT] Inequality is amplified through asset ownership, not wages.
[CONCEPT] Financial engineering outpaces real growth.
[ACTION] Focus on ownership of scarce assets, not yield chasing.
[ACTION] Be skeptical of growth narratives untethered from cash flow.
[ACTION] Study who benefits first from monetary expansion.

Chapter 9: Technology as a Monetary Force

[CONCEPT] Technology increases the velocity of money but also its fragility.
[CONCEPT] Digital systems magnify feedback loops.
[CONCEPT] Monetary systems now move at software speed, not human speed.
[ACTION] Expect volatility, not stability.
[ACTION] Build buffers rather than forecasts.
[ACTION] Treat resilience as a competitive advantage.

Chapter 10: Bitcoin as a Monetary Breakthrough

[CONCEPT] Bitcoin separates money from state control for the first time.
[CONCEPT] It is a neutral, global, immutable ledger.
[CONCEPT] Its value proposition is credibly enforced scarcity.
[ACTION] Understand Bitcoin as a monetary network, not a tech stock.
[ACTION] Study how incentives replace trust.
[ACTION] Evaluate adoption curves historically, not emotionally.

Chapter 11: Tradeoffs and Limitations of Bitcoin

[CONCEPT] Bitcoin sacrifices flexibility for credibility.
[CONCEPT] Volatility is a feature of monetization, not a flaw.
[CONCEPT] Layer-2 solutions mirror historical banking evolution.
[ACTION] Separate base-layer security from application-layer convenience.
[ACTION] Avoid all-or-nothing thinking.
[ACTION] Plan for coexistence, not replacement.

Chapter 12: The Future of Money Is Hybrid

[CONCEPT] No single system will dominate completely.
[CONCEPT] States will resist loss of monetary control.
[CONCEPT] Individuals will increasingly hedge system risk.
[ACTION] Diversify across monetary regimes, not just asset classes.
[ACTION] Maintain optionality.
[ACTION] Think in decades, not cycles.

Chapter 13: Broken Money and Social Stability

[CONCEPT] Monetary breakdown manifests as polarization, distrust, and extremism.
[CONCEPT] People sense injustice before they can articulate it.
[CONCEPT] Money failure is a slow social poison.
[ACTION] Interpret social unrest through monetary lenses.
[ACTION] Avoid moralizing systemic failures.
[ACTION] Invest in systems that restore trust.

Chapter 14: Navigating a Broken System

[CONCEPT] There is no clean reset, only adaptation.
[CONCEPT] Resilience beats optimization.
[CONCEPT] Understanding precedes advantage.
[ACTION] Own hard assets, productive assets, and optionality.
[ACTION] Reduce reliance on fragile intermediaries.
[ACTION] Become fluent in monetary history.