ECONOMY AND MONEY, HOW IS IT SUPPOSE TO WORK?

Economy and Finance

DEFINITION OF ECONOMY

You’ve heard the word “economy“, in fact, it’s probably just part of the continuous hum that is in the news.

But, what heck does it mean?  Why is it so complicated?  How come it is made to be something only well educated people seem to know about and yet, it gets all messed up when they get their hands on it?

I’ve learned that when something is really complex and perhaps too complex to understand, there are many lies in it and it’s those lies that make it seem like only geniuses can understand it.

So, here’s what economy really means per the dictionary – “the management of money earned and spent in a home, business, etc.”  Webster’s New World Student Dictionary.

Ok.  How hard is that?  You manage the money you make and the best way to handle money is to spend less than you make.

If this is so damn easy to understand, what happened to our country’s economy?  Well, you get a few “know-best” people that are out to make their own money and have no vision of the consequence of their actions and voila! you have an economic mess!

You think that’s too simple?  We have a client that is a professor of economics in a major university – a professor, mind you – and he was not only $150,000 in debt, but he was blown away when I went over these terms with him.  I told him about this stuff before I knew he was an Econ professor.

MONEY!!

With economy being really so easy to understand, what’s money?

Well, you can say that money is currency and stuff like that, but that doesn’t say what it is.  Money represents goods and services.  Rather than a farmer walking down the street with a bunch of cows so he could buy stuff (trade his cow for bread and other things), he has money that represents goods and services.  That way, a chiropractor doesn’t have to adjust the store owner in order to buy clothes, though that could happen.

Money represents energy – the fuel to keep things going or to start things going.

If you took a $20 bill out of your pocket and really looked at it, it’s just complicated paper, complicated so people can’t forge it.  But, beyond that, it is paper.  It’s what it represents that gives it value.

So, you need money as energy in order to get the things you need.

MONEY AND ECONOMY DO THEY GO TOGETHER?

Let’s put money and economy together and see how they relate.How to manage your energy (money) is what economy is all about.  Should you spend money that you don’t have in order to get the things you “need”?  Well, how well does that work?

First, understand that the goal “to have lots of money” is a bit shallow.  It’s like saying that your goal is to have an electrical power plant.

What do you want money for, and don’t be corny by saying that you want to be able to get lots of stuff and not have to worry about things.  What is your GOAL with your money?  What do you want to accomplish that money will be able to help you?

Money is energy, not the goal itself.  We are a money motivated society and so, with stupidities about money and economy in place and silly goals to “have lots of money”, we have our current economic mess.

In order to work the 2 together, money and how you spend it (economy) you have to have a goal, an objective, that you are trying to achieve.

Then, you use money to help you get to that goal.  But, money is not the goal, it’s a tool that can help you get to the goal.

There’s nothing wrong with wanting to make money, but as an end goal, it’s silly.  Making money so you can accomplish an objective that is valuable for you and others is important.

See, you have to see that money is a tool to help you and that managing your money so you spend less than you make, sensible economy, is the way you can achieve your dreams.

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