During the first day of class, Dr. McCoy gave the students of English 431 the chance to define and think about some of the course’s main vocabulary terms to begin familiarizing ourselves with the financial world. Looking back, I’m thankful for this exercise because the terms we reviewed the first day of class are already proving their importance as they continue to circulate throughout class discussion. Although many words have been highlighted in class, two words that have proved their importance early on are liquidity and swap. I knew both of these words were terms used in economics, but in all honesty, I didn’t fully comprehend their meanings prior to class discussion.
The word liquid has many meanings. For instance, Dictionary.com displays that the word liquid is commonly used to describe something that flows like water. According to Investopedia, liquidity “describes the degree to which an asset or security can be quickly bought or sold in the market at a price reflecting its intrinsic value.” Although this definition offers thoughtful insight, it is still slightly confusing for those without a background in finance. I continued to scroll down Investopedia’s page defining liquidity until I saw this: “Cash is considered the standard for liquidity because it can most quickly and easily be converted into other assets.” After reading this sentence specifically, I was able to understand liquidity in terms of cash because I use cash day in and day out. For instance, today I paid two dollars for a hot cup of coffee. In other words, my cash was converted into coffee because cash is a standard liquid asset. In return for my liquid asset of two dollars, I received a cup of coffee (less of a standard liquid asset, but more of a standard liquid drink).
Like liquidity, the term swap can also be applied to my coffee purchase this morning. Dictionary.com defines swap as an exchange, barter, or trade, as one thing for another. Investopedia offers a narrower interpretation of the word, defining swap as “an agreement between two parties to exchange sequences of cash flows for a set period of time.” Although purchasing coffee this morning was not a perfect example of financial swap, I did engage in a broad swap by trading in my two dollars for a cup of coffee.
Similar to how the terms swap and liquidity can be applied to my everyday life, these two financial terms can also be applied to William Shakespeare’s King Lear. In act one of the play, King Lear swaps his land and power for words of affirmation from his daughters. The more praise that Lear got from his daughters, the more inclined he was to pass his power down. Lear ultimately decides to exchange his power over to Goneril and Reagan because they shower him in compliments and affection. In contrast, Lear decides not to swap any of his land over to Cordelia because her words of affirmation are rather plain and modest in comparison to her sisters. Cordelia states, “Unhappy that I am, I cannot heave / My heart into my mouth. I love your Majesty / According to my bond, no more nor less” (1. 1. 100-103). Cordelia’s genuine feelings about her father are illiquid in comparison to her sisters’ deceptive and exaggerated words of affirmation. In the first act of King Lear, lies are more liquid than truth.
Although it is important to study the terms of liquidity and swap in King Lear in regards to the original transfer of land and power in act one, it is also valuable to acknowledge when Lear’s standards of liquidity shift. Lear’s standards of liquidity change once he undergoes expulsion and is stripped of all of his original monetary assets. When Lear is forced to live outdoors by Goneril and Regan, the two daughters he trusted, his perception begins to change. When Lear is out in the wild, a rain storm picks up and creates a chaotic environment. The turbulent weather however, is matched with a moment of clarity for Lear. Lear states, “Poor naked wretches, wheresoe’er you are, / That bide the pelting of this pitiless storm, / How shall your houseless heads and unfed sides, / Your looped and windowed raggedness defend you / From seasons such as these? O, I have ta’en / Too little care of this. Take physic, pomp.” (3. 4. 32-38). It is not until Lear is expulsed from his lavish living conditions that he truly understands both the monetary and intrinsic value of what he once had. The great worth of his original power, property, and loyal friends and family becomes clear to Lear as the rain falls.
By applying the terms swap and liquidity to King Lear, a couple of ideas have resonated with me. To begin, I’ve learned that economic vocabulary can be used and applied in many different scenarios. Whether you are going through your daily routine of buying coffee or reading Shakespeare, numerous types of transactions happen to take place. Perhaps the biggest lesson that I’ve learned from unpacking these terms within King Lear is that standards of intrinsic value can change depending on a person’s place and status in society. Early in the play, Lear’s comfortability and lack of awareness within his wealthy status leads him to swap everything he has for artificial compliments. Praise proves to be more liquid than truth early on. However, when Lear experiences expulsion and is left with nothing, his awareness of his surroundings increases, and loyalty and truth become infinitely more liquid than praise originally was. After considering these terms alongside King Lear, I’ve also started to consider how I value specific traits in my own life. I’ve started to wonder: What attributes do I currently value more than anything in life? Where do praise, loyalty, and truth fall? Does a person have to be expelled from their normal societal position to reevaluate their intrinsic values? While expulsion seemed to be what led Lear to having shift in emotion and awareness, perhaps picking up King Lear and unpacking it through terms such as liquidity and swap is a step towards increasing a person’s awareness without excommunicating them. Although I have not been excommunicated by an institution or person, reading Shakespeare’s work has freed me to consider these ideas and has allowed me to reassess what I value in life. By reading King Lear, I have swapped my time with some of Shakespeare’s thoughts, and I’d quickly do it again.