Is Money Real?
|May 14, 2012||Posted by Roshawn Watson under Uncategorized|
The other day I noticed “is money real?” scribbled in my notebook. Many of us spend more waking hours at work, preparing for work, complaining about work, and commuting to and from work than enjoying our families and friends. My question is “to what end?”
Consider that a generation ago, single-income households were the norm. Now, two-income households are, but what is interesting is that after you factor in child care, taxes, health insurance, and a separate car for the second spouse to get to work, the typical two-income household has less discretionary income than the single-income households of yesterday, despite earning ~75 percent more gross income. That’s partly because the purchasing power has eroded. In fact, one of the challenges currently plaguing the Euro is that some of the participating countries want to pay off their debts with devalued currencies but can’t because they are tied to the Euro. When these countries issue bonds to raise money, one would hardly expect the market to enthusiastically embrace them. After all, their spending and tax problems are secondary to their credibility (or lack thereof) issues.
That’s because money is only real to the extent that we believe that it is real. The value of money relies on someone else’s interest in receiving it. Consider an area that has been recently ravaged by a natural disaster. Temporarily, canned goods and other foodstuffs may be more scarce and thereby more valuable than than a $20 bill. Money is simply a medium of exchange, nothing more or nothing less.
Moreover, in the present age, money is often not even changing hands directly. Millions can be made from a few hand signals in a trading pit and agreements. Billions can be made from intellectual property, such as merchandising deals and royalties. For example, Cars made a respectable $462 million in the box office; Cars merchandising exceeded $8 billion (16 times box office receipts).
Why Understanding Money Is Not Real Is Important
The financial value of an idea can far exceed perhaps the monetary potential of the most intuitive applications or venues. The Cars example illustrates this point. This brings me to a fascinating concept called the principle of adjacent possibilities. It has been used to describe how innovation occurs. It suggests we innovate when we go from where we are to “the next room.” Imagine if you enter a room, of a castle, that has 5 doors. Each time you walk through one of the 5 doors, you enter another room with 4 new doors. You can only investigate new rooms from the context of the room you left. In other words, innovation is not occurring by “leaps and bounds” but by the next “adjacent possibility.”
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This principle explains why some ideas are simply ahead of their time, such as Video Mailbox. What is Video Mailbox? Well, it was the Netflix before there was a Netflix. It offered a VHS by mail service to subscribers for a fee in 1987. Like Netflix, Video Mailbox also provided subscribers a pre-paid mailer to return movies.
Obviously, it didn’t last. Sadly, for Video Mailbox, some ideas are just too revolutionary for their time. In contrast, Netflix still has a market cap of $4 billion at the time of writing this, even after an ill-executed and significant price hike, failed plans to split the company into two (streaming and DVD services), and their loss of Starz content.
An additional takeaway from the principle of adjacent possibilities is that you are in a castle of expanding possibilities rather than in a conventional (limited) construct. In other words, your potential is limitless. Consider how you would use 10 pounds of iron: I can come up with three different ways to use it which would help you derive 3 different levels of income:
- You can create horseshoes in which case, the iron would be worth $30.
- You could alternatively create needles. In this scenario, the same iron would be worth $300.
- You could create watch springs. The same iron is now valued at $3000.
This is why whenever I hear about someone who is dissatisfied with his or her present, I ask “what future do you see?” Do you see a world of poverty, lack, and abuse, or do you see a world of prosperity, provision, and harmony? In either case, you’re right.
“Think you can, think you can’t… in either case you are right.”
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Now, I recognize we can be more complex. For example, the following parable provides some context to just how challenging choosing a positive outlook can be:
“within me there are two dogs. One dog is mean and evil. The other dog is good. The mean dog constantly fights the good dog. When asked which dog wins, he reflected and said it is the dog that I feed the most.”
Within us, there can be a kind of duality. However, we determine which voice is the most credible. We decide the one we nurture. At some point, we are choosing our financial opportunities or limitations.
In suggesting that money is only as real as someone believes, I am not advocating creating counterfeits bills. I am suggesting that you write your own ticket. This very year could be the year of your uncommon success. After all, what is too much for you? Seriously, is it $5,000 per month? What about $50,000 per month? I remember hearing a keynote speaker a few years ago who was not satisfied with his company’s income. He had devised all sorts of stretch goals to expand it. At the time of the talk, it was $30,000,000 per month. I don’t know what adversity you face to make your dream a reality, but I do know that you cannot listen to the mean and evil dog. I hope you begin your journey towards infinite income potential. I certainly believe that is your possibility, but tell me, what future do you see?
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Through The Looking Glass
Image Credit: Images of Money