Economics 101 & 102
the basics- what is important to Emma Cail
The Economy is not a steady growth.
To me, this is important to know because when I am older, with a job and kids and bills, I need to understand that financially things will not always be great.
Don't be too optimistic when guessing the Economy's future.
When the economy is in an expansion period, people tend to become careless with their money. Then people begin to think that the economy will always be like this. Personally, I remember about 5 years ago when the economy was terrible. I want to remember this so I don;t become careless with my money.
Best time to invest in stocks is when the Economy is at the lowest point.
Even thought this might not seem that important, to me this explains the economic cycle. This shows that experts know the crazy change economy goes through.
Supply & Demand is HUGE!
Again, this helps explain the market to me. If the people demand it, the workers supply it. If there is no demand, less and less of that item will be supplied to the public. For example, Apple products are demand. The IPhone 6, at the moment, is the most wanted phone. No body is demanding the IPhone 4 anymore. This phone is now off the market.
Law and Supply.
The basics of law and supply suggest that if the price increases the quantity also increases. But this is not the only factor that affecting the amount of supply. Number of suppliers and price of import can also affect the amount. This is important to know because when spending money on an item, you want to know why is it this price?
The Materials Economy.
All of our stuff moves through a system called the materials economy. Something huge I got out of the women's explanation in this video was that the USA has used 30% of the planet's natural resources, when we only have 5% of the world's population. This gives me perspective of how much we need/use and how we need to start being more conservative or else natural resources will be very scarce.
That radio was worth more than $4.
The women on the video explained that so many people paid in their health, future and money to make sure you got that radio for $4. This can be put into two perspectives. One, people are very grateful for the item, no matter how small or cheap it was. Or two, people stop buying these items (a little unrealistic for today's world) and start helping other people.
The golden arrow.
The golden arrow is consumers. How much we shop and buy and consume. Yet in 6 months, 99% of those items we shop for are trashed. This shows me, in numbers, how much we waste and just how careful I should be with money.
Perceived Obsolescence.
This was very interesting to me. I see this all the time. Buy something and a new version comes out. People must buy the new version because they are convinced it is so much better. But really, the only thing changed is how the product looks. Just now realizing how true this is, I think this could change how I spend my money on certain materialistic items.
Ads! Ads! Ads!
Advertisements are always telling and reminding people how wrong their things are or how wrong they look. "Go buy this new phone!" "Go buy this new jacket!" And of course if you heard this you would say "No! I like my jacket and my phone is fine." But when someone hears this 3,000 times a day, then people start conforming to this, everyone will start buying. This is how the system works.