- Joined
- Jul 25, 2007
- Messages
- 1,894
- Location
- Endicott, New York, United States
Rep Bank
$1,315
$1,315
User Power: 20%
I've always thought of myself as a pretty smart guy. But I'm at a total loss on the current economy. I've never studied money or economics (other than one course in college), so I've always used a model that I made up myself to explain it. Unfortunately, it does nothing to explain the current situation.
In my mind, 'money' is just a paper representation of a formulaic mix of time, smarts, and raw materials. If I had to describe it (as a whole), I'd say it is 10% time, 85% smarts, and 5% raw materials.
If you come to work for me, you are trading your time (8 hours) and smarts (varies greatly) for a piece of paper that you can use to go to the store and buy eggs with. The eggs get to you because a farmer used his chickens (raw material) and time to ship them to you cheaply (smarts).
If I have chocolate, and you have peanut butter, and we are the only two people on earth, and we are sitting next to each other, I don't think we'd need money. We could just "agree". I'll give you some chocolate, if you give me some peanut butter.
But if I'm in New York, and you are in Brazil, we need money in order to get your peanut butter and my chocolate together. The basics are the same -- I'm trading some of my raw materials for some of yours -- but it takes the time and smarts and raw materials of many other people in order for the trade to occur. And that is handled fairly with the use of money.
In "Bob World", this always made sense to me. It explains supply and demand, profits, inflation, and many other economic events to me. It explains why third world countries are unable to dig out of poverty easily (they have plenty of time, but very little smarts or raw materials). But it doesn't explain the economic changes we are seeing now.
Obviously, due to their situations, everyone values their time differently. In the USA, most people would quit rather than work 10 hours for a loaf of bread. But in Etheopia, they would look at that differently. In the USA, we are mainly trading smarts and raw materials. In Etheopia, they are mainly trading time.
So, back to my question. Where has all the money gone?
If I was eager to give you some chocolate yesterday in trade for some peanut butter, why won't that deal work today? Is it because you no longer trust me to get the chocolate to you? Or I, you?
Why are so many people who were willing to trade their paper version of time, smarts and raw materials for a big-screen television yesterday, unwilling to do it today?
In my mind, nothing has changed. I still have chocolate. You still have peanut butter. Why aren't we trading any more?
Sears still has refridgerators. You still have time, smarts and raw materials. Why aren't you willing to trade?
Where has all the money gone?
(Discuss amongst yourselves...)
In my mind, 'money' is just a paper representation of a formulaic mix of time, smarts, and raw materials. If I had to describe it (as a whole), I'd say it is 10% time, 85% smarts, and 5% raw materials.
If you come to work for me, you are trading your time (8 hours) and smarts (varies greatly) for a piece of paper that you can use to go to the store and buy eggs with. The eggs get to you because a farmer used his chickens (raw material) and time to ship them to you cheaply (smarts).
If I have chocolate, and you have peanut butter, and we are the only two people on earth, and we are sitting next to each other, I don't think we'd need money. We could just "agree". I'll give you some chocolate, if you give me some peanut butter.
But if I'm in New York, and you are in Brazil, we need money in order to get your peanut butter and my chocolate together. The basics are the same -- I'm trading some of my raw materials for some of yours -- but it takes the time and smarts and raw materials of many other people in order for the trade to occur. And that is handled fairly with the use of money.
In "Bob World", this always made sense to me. It explains supply and demand, profits, inflation, and many other economic events to me. It explains why third world countries are unable to dig out of poverty easily (they have plenty of time, but very little smarts or raw materials). But it doesn't explain the economic changes we are seeing now.
Obviously, due to their situations, everyone values their time differently. In the USA, most people would quit rather than work 10 hours for a loaf of bread. But in Etheopia, they would look at that differently. In the USA, we are mainly trading smarts and raw materials. In Etheopia, they are mainly trading time.
So, back to my question. Where has all the money gone?
If I was eager to give you some chocolate yesterday in trade for some peanut butter, why won't that deal work today? Is it because you no longer trust me to get the chocolate to you? Or I, you?
Why are so many people who were willing to trade their paper version of time, smarts and raw materials for a big-screen television yesterday, unwilling to do it today?
In my mind, nothing has changed. I still have chocolate. You still have peanut butter. Why aren't we trading any more?
Sears still has refridgerators. You still have time, smarts and raw materials. Why aren't you willing to trade?
Where has all the money gone?
(Discuss amongst yourselves...)
Dislike ads? Become a Fastlane member:
Subscribe today and surround yourself with winners and millionaire mentors, not those broke friends who only want to drink beer and play video games. :-)
Membership Required: Upgrade to Expose Nearly 1,000,000 Posts
Ready to Unleash the Millionaire Entrepreneur in You?
Become a member of the Fastlane Forum, the private community founded by best-selling author and multi-millionaire entrepreneur MJ DeMarco. Since 2007, MJ DeMarco has poured his heart and soul into the Fastlane Forum, helping entrepreneurs reclaim their time, win their financial freedom, and live their best life.
With more than 39,000 posts packed with insights, strategies, and advice, you’re not just a member—you’re stepping into MJ’s inner-circle, a place where you’ll never be left alone.
Become a member and gain immediate access to...
- Active Community: Ever join a community only to find it DEAD? Not at Fastlane! As you can see from our home page, life-changing content is posted dozens of times daily.
- Exclusive Insights: Direct access to MJ DeMarco’s daily contributions and wisdom.
- Powerful Networking Opportunities: Connect with a diverse group of successful entrepreneurs who can offer mentorship, collaboration, and opportunities.
- Proven Strategies: Learn from the best in the business, with actionable advice and strategies that can accelerate your success.
"You are the average of the five people you surround yourself with the most..."
Who are you surrounding yourself with? Surround yourself with millionaire success. Join Fastlane today!
Join Today