Jim could turn around and resell it for $150 if he so desired.
Jim doesn't want to sell the lumber Jim wants to use it. What he makes with it is not sellable for the amount the lumber costed nor more.
-Sab
The Economics Thread
by sabastious 63 Replies latest social current
-
sabastious
-
sabastious
Trying to understand Economics on an Ex-JW board is an, umm, uneconomical use of your time.
HAH!
It's largely for social reasons as well.
-Sab
-
sabastious
Screw you guys I'm going to go get Econmics For Dummies!
-Sab
-
james_woods
I think they both need to get a bigger truck.
-
PSacramento
The core of economics is profit, no profit = out of business.
Now, you may not always HAVE pprofit or the kind thatis needed, but on an average, it MUST be there.
Debt can't be sustained by debt, it must be sustained by "left over profit" and if there is none, cutting measues MUSt be made or the debt hole will get bigger untill it is impissible to get out of.
THAT said, ecomomics developed for the individual or the small group has very little to do with GLOBAL economics, though the principles tend to be uniform.
While debt is a huge issue for the consumer and business, it is, arguable, far less for a country.
For one thing, who is gonna collect? and IF collection is an option, then it is also an option for the country that is having its debst called in, to cal in IT's debts also.
Many times foreign debt is "non-existant" because it was given as a "insentive" of trade and not expected to be paid back in the monetary sense.
That said, a country must have a profitable and balanced economy because if they don't, no one will want to do business with them, at least not in a way that is in the countrys best interest.
-
SixofNine
Instead of Jim producing the lumber by himself he chooses to purchase it from Frank's business.
Well unless you are a property owner who has the time and financial resources to plant/harvest trees, NO ONE produces lumber themselves.
And in a very important related sense, it's the land (state, country, continent, earth) that produces the lumber. Hence the woefully underappreciated concept of commons.
-
SixofNine
What he makes with it is not sellable for the amount the lumber costed nor more.
Obviously it's worth, to Jim, exactly what he paid for it. If Jim's interest was in making profit or even breaking even, then he would not have engaged in this transaction.
-
Berengaria
Hence the woefully underappreciated concept of commons.
-
sabastious
And in a very important related sense, it's the land (state, country, continent, earth) that produces the lumber.
Absolutely. I believe that that fact is very important to the overall picture. Isn't it government that ultimately owns the land? That's why they can forcibly buy your house from you in lou of a new expressway, correct?
-Sab
-
sabastious
Obviously it's worth, to Jim, exactly what he paid for it. If Jim's interest was in making profit or even breaking even, then he would not have engaged in this transaction.
The transaction by itself is benign, but what happens when you have a whole country of transactions like that? Ideally, shouldn't a sizable portion of the transactions within a country be self sustaining?
-Sab