ABSTRACT
This chapter examines financial capital in its various forms. Financial capital is resources that are translated into monetary instruments that make them highly liquid—that is, able to be easily converted into other assets. Traditionally financial capital has been invested in the physical objects that individuals or businesses invest in to generate new resources. Wealth created in New Hampshire can end up as an investment in California or Malaysia as savings deposits in the local bank become financial capital attracted to wherever the money can earn the highest rate of interest. The huge financial disruptions of the early twenty-first century related to accounting practices—what was counted where and for what. The Great Recession has driven down interest rates, and financial capital has moved from financial institutions to commodities, such as gold, soybeans, and farmland to increase profits. Public capital and private capital are often linked through partnerships.
