Wednesday, August 8, 2012

Lesson # 37 : Why Money?

Let's imagine this not so hypothetical example. Imagine yourself to be a seven year old kid. Now imagine watching Ben 10 on Cartoon Network. Now imagine getting hooked onto Ben 10 to the extent that you remember every bloody dialogue from every episode there is. And now imagine FunSkool taking out an entire range of Ben 10 toys.

So as a 7 year old kid what are you going to do?

Go and buy those toys outright. Or start crying in front of your parents. Maybe blackmail them into buying those toys for you. Whatever extent you have to stoop to you will just to lay your hands on those Ben 10 toys.

Cut to the point where you have bought it already and have played with it for about a week or so. What happens?

You realize that with all those false promises you made. All that effort you put into crying and forcing your parents to buy this toy it wasn't really worth it. The toy is a huge waste of your time and effort and you feel you are not going to be using it again. You'll  probably use it once or twice in the coming months and then forget it again.

Now imagine this entire cycle happening till the age of let's say 27.

At 14 you will probably discover some fancy gaming device which will cost a bomb and force your parents into buying it.

And the cycle will go on. By the time you are 27 you have been a part of this cycle countless number of times but still you haven't learnt your lesson and so you go ahead and buy a Porsche. And after having driven it around for about a month or two you realize it's fine and all but there's always something better in the market.

So let's say a newer, better and faster version hits the market. All of a sudden that old cycle ends and a new one is going to start.

It's like a high school jock spoilt for choices who infatuates about a girl, dates her for a week or two then dumps her for some other girl who catches his eye.

The question however that I wish to raise is that

If all of the above holds true in every scenario there is. Then why the hell doesn't it apply to money?


Here's why:

Money in itself is the superior most asset that a person can hold. No matter what asset a person may hold there isn't anything more liquid than money.

Secondly, the desire to earn more money comes from the fact that no matter how much a person has it's never quite enough. Because unlike the above examples where a consumer is spoilt for choices the same does not apply to money. Because money in itself is a superior commodity with absolutely no close substitutes.

Thirdly, Money in itself is a means to an end. And this end may or may not be reached. Imagine a person walking on a road not knowing the length of the road. Here the length of the road is the level of wants a person has and the calories a person holds which will give him stamina for the journey is the money he holds.

Finally, It's a psychological thing. Gordon Gekko sums it up rather well

"Greed is good and the number is more"

Gordon Gekko : "Greed is good and the number is more"

- Doodle