Trade The Journey

Trade The Journey

The Science of Money Pt.2

“The Value of Money depends on the things a person believes they need to buy. The more expensive the needs, the less value money has.” Think Rich (H. Stanley Judd)

 

The central theme of the book seemed to be that the value of Money was not as rigid as we thought but relative. It is relative because it holds different values for different people. How I perceive money and what it could do for me, is entirely different for you. Money seemed to take another form while I was reading the book. In fact its form completely disappeared to me and had transformed to an idea in physical form.

Prior to reading this book, I like most thought of money as what I held in my hand, in my pocket, in my bank account and what I earned. Its tracked in the economy and the stability in which a country grows and maintains its money, is reflected throughout the world.  In the economy, we track the money in the economy with different measures to ensure that we not inflating money’s worth and we also track the cost of it. This is in a nutshell of how we control the economy and try to balance things, I think. If we did not, money would become unstable and a collapse would be unavoidable. This is why we have to understand exactly what money is?

 

If we take away the picture of Lincoln and all the other symbols on top of the bill, it wouldn’t be a bill at all. It would just be a piece of paper. But because I agree that it is worth something and you agree it is worth something, it is worth something. I can value what I have in terms of the bill and offer to sell it to the highest bidder to receive more of it. And  just like that we have exchanged bills but more importantly we have exchanged something to receive what we both desire at the moment. You desire the item/service and I desire the bill that you possess because of its value.

 

How expensive are your needs? Or to put it differently how expensive are your values? What you value is probably at the root of either your money successes or failures. Some people value the esteem of their peers which can be costly, others value great experiences, some value security, some value the peace of mind and freedom it provides and some value what it can do for their own self-esteem. Whatever you value seems to cause the needs that may arise in your life. It also shapes your perspective of money and also shows why its relative. It shows why someone can make money and others spend it.

 

For me, it was the great experience of eating sushi and it was the esteem I received from being able to buy things I couldn’t afford to buy before I got my paycheck. Although it wasn’t a lot of money I was spending in the grand scheme of things, it was more than I was making. My so-called needs were expensive relative to my income and money lost its value. It lost its value both in my mind because of what I thought of it and in terms of actual value, because I begin to borrow it so that I had it to spend. Borrowed money meant that the value of it doubled in the amount I paid back to the creditor. I guess it wasn’t bad for everyone, the creditor valued money and understood that $1 lent could become $1.25 returned.

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