We express ourselves to fulfill our needs, wants, desires, and goals. Today most individuals can channel their energies to fulfill needs beyond the requirements of food and shelter, but to do so requires money. Money allows for a system of exchange where we can trade the goods and services created from individuals expressing themselves in highly specialized ways. Money has evolved to become the object of our needs because it represents the means or path by which we can express ourselves as individuals. All behavior is a form of self-expression, and almost any way in which an individual wants to express himself in our society requires money. So at the most fundamental level of cultural existence, money represents freedom of expression. Individuals expressing themselves in specialized ways create a highly complex system of interdependency. To exchange goods and services, individuals have to agree on the value of those goods and services to make an exchange. I am defining "value" as the relative degree of importance or potential something has in fulfilling a need.
The actual price at which goods and services are then exchanged will be determined by the fundamental economic law of supply and demand. In psychological terms, the law of supply and demand is founded in human fear and greed. Both fear and greed will compel people to act or not act depending on their needs in relation to the perceived external conditions. The price for goods and services will be determined by the individual's needs in relationship to their belief in their ability to fulfill those needs. Implied within that belief is their perception of the availability of the goods and services they need. Greed is founded in a belief in scarcity and insecurity. Both beliefs generate fear. I am defining "greed" as a belief that there will never be enough available to fulfill oneself in combination with a belief that one always needs more to feel secure or satisfied. The perception that these conditions exist either internally or externally will generate a fear that will compel one to act or not act, depending on who controls the supply. The behavior someone displays will be consistent with what they believe they must do to satisfy the deficit. If two or more people have the same fears, they will typically compete among one another for the existing supply.
If the supply of something is limited in relationship to the need, those that are in need will compete for the available supply. They will compete by their willingness to exchange more resources (pay more money) than will someone else who may also be in need. If, however, the supply is great in relationship to the need (demand), there will be no fear of scarcity; consequently, people will conserve their resources (money) by diverting them to other needs or just waiting for the possibility that the price may come down. Any system of interaction founded in individual fears of lack or scarcity will cause the price of goods and services to fluctuate in relationship to the relative degree of security or insecurity that is being experienced by the collective masses at any given moment. These fluctuating prices create economic risk for all those dependent on others to fulfill a need that they cannot fill themselves. What is risk? Risk is the possibility of a net loss of personal resources (energy, money etc.) in the exchange or pursuit of fulfilling a need. Fluctuating prices also create opportunities for those who are willing to assume the risk created by price movement. As long as there is disagreement between individuals about the value of goods and services, prices will fluctuate, thereby creating opportunities for traders to make money if they will assume the risks.
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