comment

Hoarding, storing value

and the credit crunch
A comment on Hart/Ortiz and Gudeman
(AT 24[6])

The credit crunch of 2008 has taught us all

a great deal, but it has perhaps reminded us
of even more. As Gudeman (2008) and Hart
and Ortiz (2008) point out, much that we are
witnessing has been chronicled by others in
the past not only by fusty economists writing
about the Great Depression, but even by
anthropologists tackling seemingly unrelated
topics. Perhaps our penchant for seeing an
unbridgeable chasm between the disciplines of
economics and anthropology has blurred our
vision a bit. Perhaps we have more common
cause with these scholars than our typical
straw-man construction of them might suggest.
As Hart and Ortiz and Gudeman know well,
economics as a discipline is a good deal more
heterogeneous than we often rashly suppose
(see, for example, the recent edited volume by
Rochon and Rossi 2003). If we can find points
of convergence in our studies with economists,
perhaps we can rejoin the global conversation
that Hart, Ortiz and Gudeman are all rightly
frustrated that we left long ago. On this note, I
will dedicate my brief comments to exploring
one potential such convergence.
Mary Douglas (2004) long ago exposed
the error of thinking that primitive ritual
could be explained as a purely psychological
phenomenon. But despite many decades of
anthropological focus on the various means
through which societies store wealth over time
and space, a similar reassessment has never
occurred for the phenomenon of hoarding,
which is much studied in psychology, but
infrequently examined by anthropologists.
And yet, as Keynes asserted so forcefully, the
liquidity preference (his term for hoarding)
is indeed influenced by shifting cultural norms
and variations in social institutions. Clearly,
it can therefore be altered via government
intervention (or other social forces), rather
than being hopelessly left to the whims of the
natural(ized) marketplace.
But anthropologists do study practices
resembling hoarding, though we typically
give them another name, perhaps since we do
not like the negative connotations the word
carries today. Hoarding is but one of many
types of storing economic value over time
and space. We have countless studies of this
broader phenomenon. Wider circulation of
such studies to scholars outside of anthropology might help answer not only thorny
questions such as why are banks refusing
to lend to one another? but also, why do
cheque-cashing agencies proliferate in lowincome neighbourhoods? Though these two
questions seem to address widely divergent
matters, anthropological studies of the storage
of economic value can bring them together.
Anthropologists know, from studies as
ANTHROPOLOGY TODAY Vol 25 No 2, April 2009

diverse as those by Akin and Robbins (1999),

Bloch and Parry (1989), Comaroff and
Comaroff (1990), Day, Papataxiarchis and
Stewart (1999), Graeber (1996), Gudeman
(2001), Guyer (2004), Hart (2000), Maurer
(2005), Miyazaki (2006), Munn (1986),
Peebles (2008), Roitman (2005), Verdery
(1996), Weiner (1992), Woodburn (1982),
Zaloom (2006), Zelizer (1997) and Znoj
(1998), that when choosing to save money for
tomorrow instead of spending it today, people
have a wide range of options. But despite this
array of scholarship, we still tend to think that
economic value is stored in a bank. And when
banks are mentioned, anthropologists happily
hand over the reins to economists. But there
are many different ways of storing economic
value, whether in social relations, in the
landscape, in an earring or, as Hart and Ortiz
(2008) point out, in a kula shell valuable.
Anthropology and its ethnographic method
excel not only at documenting these varied
techniques and competing ideas about
spending versus saving, but also at theorizing
why they are so prevalent in some settings but
rather less so in others. We must insist more on
connecting our deep tradition of studying economic storage with the central problem of the
2008 credit crunch the hoarding of capital
by the particular social institutions known as
banks. We know this material well, if we could
only see it for what it is. Our long-practised
attention to the mutual construction of subjects
and objects could prove a great asset as we
try to contribute to debates emerging from the
mercurial economic woes of 2008 documented
by Gudeman (2008) and Hart and Ortiz (2008).
The banks, after all, have merely decided that
they no longer know the social identity of
other borrowers well enough to lend their valuables to them; instead, banks are choosing to
keep these valuables immobilized at home and
out of the cycle of circulation. Keynes turned
his attention to this issue long ago, and built
a grand research tradition around his discoveries. But so did Malinowski. l
Gustav Peebles
The New School, NY
peeblesg@newschool.edu
Akin, David and Robbins, Joel (eds) 1999. Money and
modernity: State and local currencies in Melanesia.
Pittsburgh, PA: University of Pittsburgh Press.
Bloch, Maurice and Parry, Jonathan 1989. Money and the
morality of exchange. New York: Cambridge University
Press.
Comaroff, Jean and Comaroff, John L. 1990. Goodly beasts,
beastly goods: Cattle and commodities in a South African
context. American Ethnologist 17(2): 195-216.
Day, Sophie, Papataxiarchis, Evthymios and Stewart,
Michael (eds) 1999. Consider the lilies of the field.
Boulder, CO: Westview Press.
Douglas, Mary. 2004 [1966]. Purity and danger. New York:
Routledge.
Foster, Robert. 1998. Your money, our money, the
governments money: Finance and fetishism in
Melanesia. In: Spyer, Patricia (ed.) Border fetishisms,
pp.60-90. New York: Routledge.
Graeber, David 1996. Beads and money: Notes toward a
theory of wealth and power. American Ethnologist. 23:

4-24.
Gudeman, Stephen 2001. The anthropology of economy.
Malden, MA: Blackwell Publishers.
2008. Watching Wall Street: A global earthquake.
Anthropology Today. 24(6): 20-24.
Guyer, Jane 2004. Marginal gains: Monetary transactions
in Atlantic Africa. Lewis Henry Morgan lectures 1997.
Chicago: University of Chicago Press.
Hart, Keith 2001. Money in an unequal world: Keith Hart
and his memory bank. New York: Texere.
and Ortiz, Horacio 2008. Anthropology in the financial
crisis. Anthropology Today 24(6): 1-3.
Maurer, Bill 2005. Mutual Life, Limited: Islamic banking,
alternative currencies, lateral reason. Princeton:
Princeton University Press.
Miyazaki, Hirokazu 2006. Economy of dreams: Hope in
global capitalism and its critiques. Cultural Anthropology
21(2): 147-172.
Munn, Nancy 1986. The fame of Gawa. Durham, NC: Duke
University Press.
Peebles, Gustav 2008. Inverting the panopticon: Money and
the nationalization of the future. Public Culture 20(2):
233-265.
Roitman, Janet 2005. Fiscal disobedience: An anthropology
of economic regulation in Central Africa. Princeton:
Princeton University Press.
Rochon, Louis-Philippe and Rossi, Sergio 2003. Modern
theories of money: The nature and role of money in
capitalist economies. Northampton, MA: Edward Elgar.
Verdery, Katherine 1996. What was socialism and what
comes next? Princeton: Princeton University Press.
Weiner, Annette 1992. Inalienable possessions: The
paradox of keeping-while-giving. Berkeley: University of
California Press.
Woodburn, James 1982. Egalitarian societies. Man 17(3):
431-451.
Zaloom, Caitlin 2006. Out of the pits. Chicago: University
of Chicago Press.
Zelizer, Viviana 1997. The social meaning of money.
Princeton: Princeton University Press.
Znoj, Heinzpeter 1998. Hot money and war debts:
Transactional regimes in southwestern Sumatra.
Comparative Studies in Society and History 40(2): 193-222.

Hoarding wealth: When

virtue becomes vice

A response to Elyachar/Maurer, Applbaum

and Peebles (AT 25[1] and in this issue)
My commentators are concerned that few
anthropologists have used our disciplinary
knowledge to understand the current liquidity
crisis and recession, or to engage economists
explanations. Elyachar and Maurer call for
more ethnographies of modern financial markets, and Applbaum wants to overthrow the
idea that self-interest drives economy. Peebles
observes that banks even with help from
their respective governments have chosen
to rebuild their balance sheets rather than lend
to the commercial and residential spheres.
Keynes, he rightly notes, addressed this issue
in terms of hoarding and liquidity preference,
and he adds that anthropologists too have
studied hoarding. But according to Peebles,
we have not employed anthropology to understand market crises, nor have we engaged the
Keynesian idea that cultural norms and institutions influence hoarding.
His observations require some tempering.
First, Keynes certainly developed a structural or macro view of market economy, but
he often wrote in terms of its psychological
or atomistic foundations, such as individual
25

preferences, instincts and motivations. For

example, according to Keynes, we hold or
keep money partly for instinctive reasons,
and we have psychological time preferences
concerning money. These deeper-level motivations emerge when higher, more precarious
conventions have weakened (Keynes 1937,
1936). His narrative relies on infra-cultural
and -structural assumptions about the way
economy and life are made. To be certain,
Keynes offers deep insights about economy,
but I am not convinced that he draws on
the idea of cultural norms and institutions,
as Peebles claims. Is this an opening for
anthropology?
For example, Alberto Rivera and I once
studied hoarding and thrift (making savings) in the household economies of highland
Colombia (Gudeman and Rivera 1990). We
found that households try to produce enough
each year to replenish their expenditure so
that they can maintain their material cycle in
the coming year. Amounts above the replacement needs, known as leftovers, are kept as a
reserve. They constitute the hoard, which is
made up of produce, animals and other goods.
The size of a hoard is a function of making
savings or being thrifty in production and
consumption.
We compared these household practices to
Keynes argument about hoarding in a market
economy, and suggested the following parallel:
in the house economy, annual returns =
replacement expenditures + remainders (savings
or hoards)
in the market economy, yearly income =
consumption + savings (which fund new
investment and/or hoards).

Let me explain. In a market economy, to

follow Keynes, with an increase in the precautionary motive (the propensity to hoard) and a
drop in animal spirits that propel investments
in the future, savings become or are reduced to
hoards. When a liquidity crisis sets in, uncertainty overwhelms our spirits, we lose belief in
investments, and we pull back to holding, hoping
and maintaining, as in a household economy.
In other words, market actions become houselike when under stress. Is this one connection
between the economies anthropologists have
studied and markets as seen by Keynes and his
successors? Is domestic economy, whether in the
household, the lineage or the manor, the inner
pillar of market economy?
Rivera and I also offered a sketch of the
place of thrift or frugality in Greek and early
modern writings on household economies, and
in several of Keynes predecessors. We surmised that as economies and economic theories evolved, the original idea of valuing thrift
as a mode of maintaining households, manors
and like institutions was used in the expanding
market context to argue that interest earned
on money saved was a reward or increment
for that saving. Keynes, drawing on a market
and expansionary vision of capital, turned
this idea on its head by claiming interest is
not a reward for abstinence, for thrift or for
waiting but a return for giving up the security
of keeping a liquid hoard (Gudeman and
26

Rivera 1990: 181). If hoarding looks the same

in different economies, its impact can be very
different.
In highland Colombia, being thrifty helps
people build a household base outside markets. This reserve collects no interest. In
market economies, the liquid cash reserves
that Keynes was addressing (which are M0 or
currency plus bank reserves) similarly do not
draw interest. In both house and market economies reserves or hoards, such as coins and
other valuables, are kept as precautions in the
face of uncertainty. In the United States this
no-interest reserve money that is kept in banks
and circulation is termed base money. In
rural Colombia and elsewhere the no-interest
holding is known as the base. In both cases
the fallback is the hoard or base.
So, is hoarding and keeping a base good or
bad? It can certainly make us feel better, especially when we own a mortgage-free house or
gold, and it helps the house economy in Latin
America, but this preserve against uncertainty
can endanger the liquidity and functioning of
the market. We thus arrive at the Keynesian
paradox of thrift: private virtue (hoarding
money) can be a public vice (when it leads to
lassitude in the larger economy), although in
good times frugality provides funds for investment. But is the Keynesian paradox really a
paradox? Being thrifty is a paradox only if
with economists we see economy through
the perspective of markets and market-like
behaviour, because by their view economy is
equated with markets.
In contrast, I think economy is a dialectical combination of competitive trade and of
householding, of market and community, of
anonymous exchanges and the maintaining
of social relationships that mediate material
activities (Gudeman 2008). Economy happens
through both domains of life. Anthropologists
know a lot about one side, economists about
the other. All of us are pulled in both directions
in different ways, at different times and in
different places. Being thrifty, the propensity
to hoard or the precautionary motive marks
one meeting point of these two value domains.
At some times we are drawn toward one way
of making economy and at other times toward
the other. Keynes showed how to revive
markets and move an economy in the market
direction at moments of lassitude by drawing
on a shared base that is created by the nation
(the bailout and stimulus spending).
In my earlier contribution to AT I noted the
irony for neo-liberal economics that action
(such as the creation of more base money) by
the community, which surrounds a market, is
needed to save markets from their self-destructive tendencies. Can rationalistic economics
explain this exogenous action, or do we need a
dialectical and anthropological view of swings
and cycles to understand our material lives?
Keynes somewhere remarked that economics
is the queen of the social sciences; perhaps she
needs anthropology as her consort.
Stephen Gudeman
University of Minnesota/Max Planck
Institute for Social Anthropology
gudeman@umn.edu

Gudeman, Stephen 2008. Economys tension: The dialectics

of community and market. New York: Berghahn.
Gudeman, Stephen and Rivera, Alberto 1990. Conversations
in Colombia: The domestic economy in life and text.
Cambridge: Cambridge University Press.
Keynes, John Maynard 1964 [1936]. The general theory of
employment, interest and money. New York: Harcourt,
Brace & World.
1936. The general theory of employment. The Quarterly
Journal of Economics 51(2): 209-223.

THE DESCRIPTION OF
FINANCIAL OBJECTS

A comment on Hart/Ortiz (AT 24[6])

In their guest editorial, Keith Hart and Horacio
Ortiz refer to the kula and its analysis by
Bronislaw Malinowski and Marcel Mauss,
noting that issues of distribution and hierarchy
were at stake in this exchange institution and,
perhaps more importantly, that the imaginary
force of the monetary objects also defined
the multiple but limited possibilities of the participants. Note that Hart and Ortiz use quotation marks for force and objects (rather than,
say, for imaginary and monetary). This small
nuance in wording may not be particularly
intended and is possibly of not much significance for a discussion on the ambitions of an
anthropological take on the financial crisis.
Hart and Ortiz address the fundamental task of
developing a historically and ethnographically
grounded approach to the study of finance a
political anthropology of finance as we might
term it, using the expression that Ortiz puts forward in his doctoral dissertation. The issue of
the quotation marks can nevertheless be raised
here, in relation to this task, as attention to these
two elements (objects and their force) seems
quite important when dealing with the reality of
financial devices from an anthropological viewpoint. The fact that, despite attempts by authors
such as Annette Weiner and Maurice Godelier
to take Mauss seriously on precisely this issue,
the spirit of the gift is still generally understood as calling for quotation marks (possibly
as a warning against fetishism or mystification)
might be relevant in relation to the definition of
a political anthropology of finance.
One of the more salient challenges of such
an approach is the difficulty posed by the
description of financial objects. Financial
objects include a wide array of things (from
a simple loan to an asset-backed security,
from a bank account to a hedge fund, from a
stock to a structured contract, from a balance
sheet to a special purpose vehicle) which are
difficult to describe, difficult to account for
or to understand, sometimes even for those
involved in the financial services industry. For
political anthropology of finance, however,
descriptions of such objects should not stop at
being clear, meaningful and understandable.
More importantly, they should aim at being
anthropological and political descriptions. The
sense of this is yet to be worked out. But such
descriptions need for sure at least to pay attention to the intricacies of agency at work within
these objects.
Financial objects do things. They have consequences, act as constraints on further action,
are themselves actions under constraint, and
ANTHROPOLOGY TODAY Vol 25 No 2, April 2009