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If tx rate is the “velocity” of money, what physics quantities do other measures map to? Eg: wealth = volume? inflation = d(density)/dt? Interest rate = ? Macro velocity (gdp/money supply) looks kinda like temperature Micro (velocity of a specific dollar) = gas particle?
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Marketcap = valuation multiple x earnings Weight = gravitation x mass When multiples crash in the market, its like gravity has increased for the companies. valuation multiple is roughly inverse-gravity
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I think price theory lifted enough of their methods from mechanics that you can construct a legrangian for a particular market but I would have to get out textbooks in both subjects to work the analogy through. From memory I think prices might be energies.
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You can't have wealth=volume and inflation = d/dt(density). Wealth would have to be \int density, aka the mass/energy. Or if you want to keep the wealth part, inflation would have to be the cosmological constant. Ha!
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