An All-Consuming Parable

There was a society that was extraordinarily gifted in making things. Most people created what they needed themselves. Some of them developed the ability to make certain things much better than others could make the same items. Over time, they not only could make them better, but also could make them faster and cheaper, even at scale.

While this was quite the accomplishment, the problem was that these producers began to have their warehouses filled with their goods. Creative members of this group found ways to tell large number of people about their wares, and how if folks would buy their products instead of making the items themselves, they would save time and have better products.

All of these ideas caught on. The people began to specialize in what they produced best, and sold them to each other in order to buy others’ products. Life got easier.

As people grew to enjoy consuming each others’ products, a dynamic equilibrium was approached between production and consumption. However, as people learned to consume ready-made items, they became interested in newer and more types of products, which increased demand for new producers. So growth occurred instead of reaching equilibrium. This was good.

Personal Finance

With all of the hullabaloo in Washington over the debt ceiling, it reminds me of yet another area where our educational system fails our students, and ultimately our country. For the most part, we don’t teach students how money works.

We assume that money is merely an application of math, but it is a system just like Euclidian math, or grammar or stoichiometry are systems for doing tasks. Unless you take an elective or are a banking/finance or related major, you are not exposed to how our monetary system works, how wealth is created and destroyed, how the different areas of the economy have constructive and destructive interference patterns just like light or waves, and so on.

Working Together

Though one may be overpowered, two can defend themselves. A cord of three strands is not quickly broken.                                Ecclesiastes 4:12

It is cliché to say that times are tough. It is also true. Some of the more dire prognosticators foretell of economic collapse globally and complete devaluation of the dollar. Money only has the value we give it and it is a means of converting our effort, skills, toil, expertise and investments into a portable and broadly acceptable format in exchanges for products or services offered by others. That is all money is.

When money has no value, OR when we are unable to convert our personal resources into money, that is the definition of economic hard times at its most fundamental level. Therefore, we are obligated to find other means of using our personal resources (skills, talents, gifts, strengths, passions) to obtain things we need/want for life.