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Trades Vs. Directions


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One of the more interesting models of life in general is that of exchange.

Once you understand this, you can see it everywhere.

Every time you breathe, you are exchanging oxygen and carbon dioxide.

Then the hemoglobin in your blood goes around and makes another exchange.

It delivers the oxygen to the muscles, picks up the CO2, and goes back to the lungs.

The same goes with food.

You could get a PHD in molecular biology, or organic chemistry and STILL not fully understand this.

The complexity of life, on a fundamental level, on something as basic as energy exchange is staggering.

Yet exchange is what drives everything.

It's hard not to notice the similarities between blood around the body and money around the world.

Money flows in one direction.

In the opposite directions, goods flow.

You go to the store, give money, and get something to eat.

A burrito.

The store then pays the money to the burrito suppliers.

Those guys send the money back up the supply line.

Money flowing one direction, goods flowing the other.

Every single time, an exchange taking place.

Just like every single time a hemoglobin molecules comes to the lung-blood interface, it drops off a CO2 and picks up an O2.

And just like in your body, if the "blood supply line" gets blocked, bad things happen.

If you get a clogged artery in your heart, the blood can't deliver oxygen to your heart muscles, and your heart muscles stop pumping.

Similarly, whenever the "money-goods" supply line stops, bad things happen.

Even friendly conversations can be seen in this exchange model.

We rarely think about this, but it's there.

You share some ideas, they share some ideas back.

Money for burritos.

Oxygen for CO2.

Opinions about the weather for opinions about the local sports teams.

Even at it's most basic form, economics is all about this trade.

Inside everybody's brain is a collection of things they want.

And for each one of these things that we want, we have a vague idea of what we're willing to DO to get these things.

Most exchanges, both scientifically, economically and mentally are discrete.

Do this, get that.

Drop off O2, pick up CO2.

Give the guy $3.25, and get a burrito.

Spit out a few words, and get a smile.

But sometimes this is NOT enough.

When the changes are really metaphorical.

For example, if you wanted a dollar, it would be easy.

Do ONE THING, and then somebody would give you a dollar.

But if you wanted a MILLION dollars?

It would take a LOT of "trades" over a LONG TIME.

So thinking in terms of "what ONE THING can I do to GET a million dollars" is not really appropriate.

Another way we over-simplify this "trade" idea is getting in physical shape.

What can I "DO" to "GET" a six pack, for example.

Sexy bodies and fat bank accounts have a lot in common.

They are better thought of as HORIZON goals.

Things you don't really just "get," but things you are ALWAYS getting closer to.

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