Everything you know about interest is wrong
To understand interest rates, we have to get nuanced about credit
5 min readMay 23, 2020
Real vs. Nominal Spending
Before we can talk about credit, we have to understand the difference between real and nominal spending. Any activity of credit involves allocating real resources to a person or project, and it may also involve allocating money in order to compensate those involved.
- Real Spending — Required Physical Resources
- Nominal Spending —…