About

The Guns and Butter model is a macroeconomic theme used as an example of a simple production-possibility frontier which demonstrates the idea of opportunity cost.  In a theoretical economy with only two goods, a choice must be made between how much of each good to produce.

Historically, it demonstrates the relationship between a nations investments in defense and civilian goods.  In this example, the nation may either buy guns (investment in defense/military) or butter (invest in the production of goods) or a combination of both.

For our purposes (and for most individuals not running a nation), the “guns” represents activities that appreciate in value (stocks, bonds, real estate, artwork) while the “butter” represents material that depreciates in value (consumer goods, cars, clothes, etc.).

The point here is that every choice has an opportunity cost; you can get more of something only by giving up something else.

Our objective is to curate and deliver financial content in a consumable way to help our members accumulate the “guns” instead of being distracted by the “butter”.