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One way to divide the economy is into financial assets and real assets. Making this distinction allows us to make judgments about intangible ideas such as value, productivity and net worth .

Financial assets can be roughly divided into two classifications: 1. currency or deposits and 2. paper assets such as stocks and bonds. Mortgage notes are also financial assets, generally held by banks with a real asset as collateral.

Financial assets generally derive their value from a contractual claim on the liability of another. This is why, if you cancelled out all the financial assets in the world, what you would be left with is all the Real Assets.

Real assets could also be broken down into two categories: tangible assets and intangible assets. Tangible assets are anything which can be physically touched, including real estate and personal property, such as an antique chair or work of art. Intangible assets would be items like copyrights, trademarks or patents, which can be owned and transferred but have no, or minimal, physical substance.

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