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Principles of Economics by Saifedean Ammous

June 22, 2025 - 701 words - 4 mins Found a typo? Edit me
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If you’ve ever scratched your head at the economy, wondered why prices keep rising, or questioned why money seems to lose value over time, Principles of Economics by Saifedean Ammous might blow your mind.

It’s not your typical dry economics book. Instead, it’s a bold, no-nonsense guide to understanding how the world really works—through the lens of Austrian economics. Here’s what stood out to me.

1. Economics = Human Action

Ammous starts with something super simple but powerful: economics is just people making choices. Every time we choose to do one thing over another, that’s economics in action.

Forget all the charts and equations you might’ve seen in school — real economics begins with you trying to make life better, one decision at a time.

2. Time Preference = How Much You Value the Future

This idea was a game-changer: your time preference is how much you value stuff now vs. later.

  • If you spend everything today, you’ve got a high time preference.
  • If you save and plan for tomorrow, you’ve got a low time preference.

Low time preference leads to building cool things. Like businesses, families, skyscrapers, or even civilizations. High time preference? That’s fast food, impulse buying, and short-term thinking.

3. Good Money = Strong Society

The quality of a society’s money affects everything. If your money constantly loses value (hello, inflation), people stop saving and start living for today.

He argues that government-controlled “fiat” money is the problem — and we need a return to “hard money” (like gold or Bitcoin) that holds its value over time. Good money helps people plan, save, and grow wealth across generations.

4. Producing Stuff Takes Time — and That Matters

Making things isn’t instant. It takes time, tools, and planning. Ammous explains how advanced economies only exist because people invest in long-term production: factories, machines, supply chains.

That’s only possible when people trust their money and their future. So again, low time preference is key.

5. Entrepreneurs, Not Governments, Drive Progress

If there’s a hero in this book, it’s the entrepreneur — the person who takes risks, builds businesses, and creates value.

Ammous has zero love for central planners, regulations, or government bailouts. He’s all about free markets and letting smart people solve problems without interference. When prices are honest and money is sound, people figure things out on their own.

6. Inflation and Central Planning? Big Red Flags

Ammous doesn’t pull punches. He’s very critical of how governments manage money and the economy.

He sees inflation as a sneaky form of theft and believes that constant meddling (like printing money or setting interest rates) only makes things worse. He even calls out entire fields like climate economics and ESG as being more about politics than real economics.

7. Bitcoin: The Grand Finale

While this book isn’t just about Bitcoin, it clearly leads there. After explaining why our current money system is broken, Ammous points to Bitcoin as the best solution we’ve seen in over a century.

It’s digital, limited, and no one can mess with it. Bitcoin is the return of sound money, and a chance to fix a lot of what’s wrong today.

Final Thoughts: A Crash Course in Real Economics

“Principles of Economics” is like an economics red pill. It’s straightforward, bold, and sometimes brutal. But if you’re tired of the usual financial nonsense, this book will hit you like a breath of fresh air.

You’ll walk away with a new lens to see the world—why prices rise, why saving matters, and why the kind of money we use shapes everything.

TL;DR

  • People act with a purpose.
  • Thinking long-term builds great things.
  • Sound money matters.
  • Free markets beat central planning.
  • Bitcoin fixes a lot of problems.

Austrian Economics vs Keynesian Economics

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