If you think that you’re a victim, you are really your own oppressor! Building wealth and demand in an Inclusive System

Finance & Fury Podcast

Welcome to Furious Fridays!

Make sure you’re caught up with last week’s episode about the system and what it should provide

System - Inclusive Vs Extractive systems

1. Inclusive - Equality of opportunity – everyone has access, same rights, no preferences
2. Accountable – Can’t be extractive: held accountable and easily removable, transparent
3. What system provides – what incentivises should be available
4. Property rights – keep what you own
   • Ownership of what you own and purchase,
   • Patents
5. Legal system - protect what you have, know deals are honoured
6. Contracts
7. Borrowing
8. Public services – Well functioning state; police, infrastructure, education

Use what the system provides – What has worked over history

1. Extractive system – those that rise to power and keep it, sucking wealth up (short term for some)
2. Inclusive system – those that do it on their own and keep it.

Your incentive: increase the incentive of others to exchange money with you.

1. System provides freedom – freedom of exchange of money is the first part
2. You have wants, you buy goods/services and exchange money for it
3. Wants – Things to be met by products and services
4. Products and services – the vehicle of wealth transfer in a free market

Options on how to have individuals voluntarily transfer wealth to you:

1. Create the product/service – New idea, or improvement to existing
   • Demand for a product of service
   • This is what people need, and will exchange money for
   • Built around solving problems, or convincing people of needs (marketing)
2. Participate with an existing product or service – employment
   • Demand for you and what you can do to improve the product/service
   • What you know to help? How can you get to know more?
   • How you can use it to help?

Creative destruction: mechanism for societal improvements

1. Extractive economy - too destabilising = lose power. Stocking producer in England – Elizabeth banned him from doing it, but he had to go through the state to do, went to France, same story.
2. Inclusive - If you think there is no money in something as nobody is doing it, there may be money.
   • What do people need? People solving problems – wealth is transactional under this system.
   • Or, Who do products/services need?

Where do you start? Figure out the area to focus on

1. What are you good at?
   • Individuals have talents – mine is numbers/theory, don’t give me an English test.
2. What you like to do?
   • Happens that as I am interested in finance/economy, which is thankfully has theory and numbers
3. If you don’t know: Get a list together! See if there are cross overs.

Once you have it: Either what product/service you want to work with, or create yourself

1. First step – increase your demand – have to provide greater value than cost (PROFITS are incentive)
   • Product – Best product or service, or what people value
   • Individual – what do companies need?
2. Second step – Once people transfer wealth to you invest your surplus
   • Reinvest in business/build outside investments
   • Invest personally to build personal wealth beyond transfer of wealth
3. Third step – keep repeating steps one and two again & again

Along the way: Tools at your disposal

• Systems to take advantage of
  • Property rights – you keep what you earn/save
  • Borrowing – leverage your wealth to access capital to invest
  • Legal system – minimise tax and protecting what you own

The really wealthy have always done this well

1. Created a product/service people really want.
2. Kept reinvesting and creating more to fulfil peoples wants.
   • The more people want what you have, or the more people want what you can offer them,
   • the more you are in demand, the more you can demand for your good,
   • the more people will transfer your wealth.

THE BAD - Crooks and people who transfer wealth to themselves, for poor or no service

1. Obvious flaw in the system – transfer in wealth needs to be beneficial, informed voluntary decision.
2. Market crashes occur – thanks to human behaviour – but the market learns
3. Human nature – we are more self-interested than altruistic
   • Works in small numbers – help your friends/tribe, etc.
   • But when in millions of people, humans’ motivation on average is the self
   • Why shared group work people slack off – for additional effort you put in, little additional reward.
   • NEED INCENTIVES!

Our stories

1. Jayden and my story are similar – Started PAYG – saw problems with the systems, wanted to improve.
2. Started own companies – potential to do a better job at helping people
3. Provides freedom to improve what you are doing.
   • When you are starting out – you really want to do a good job, if you can’t help people, your business fails.
   • When you are comfortable at the top – what are your incentives? It’s pretty hard to change, but the old models don’t work for new world – Creative destruction

In summary

1. Become “In-demand”
   • Product/service
   • You are the product – measured by how much people want you
2. Decide what you want to be demanded for
   • Get really good at it, or
   • Create a product people want.
3. Keep some of the wealth transferred to you to invest (keep/save)
4. Keeping improving!
   • Product - Reinvest the rest, do a better job, and
   • Self-improvement

If you think that you’re a victim, you are really your own oppressor!

Leave a review, ask a question or provide some feedback. We love hearing from our listeners! Go to https://financeandfury.com.au/contact/