Purchasing Power

When we exchange our products, we have to know how much of our product, “A”, it takes to have the product “B” we want from someone else. We discuss how difficult it is to produce “A” compared to “B” and other things like that, soon we find ourselves dealing with supply and demand, and the result is that, say, yesterday a fish was worth three eggs and an egg was worth a third of a fish, while today a fish is worth two eggs and an egg is worth half a fish. So today the purchasing power of a fish, measured in eggs, is two, and the purchasing power of an egg, measured in fishes, is one half.

But let’s take a closer look now, before going ahead: what is our purchasing power, exactly? It is our production that others are willing to accept in exchange for theirs. And our credit – credit intended as how trusted by others we are – is the trust of others in our production potential. And the purchasing power of those who can’t produce is the support that others are willing to give them.