There are two primary approaches to creating something: bottom-up design and top-down design . Top-down design is often seen in architecture. People do not build bricks randomly; instead, they follow the design drawings created by the architect. This method executes a plan that has already been established. When asked why something is built in a certain way, the answer is usually that the blueprint dictates its design. Conversely, bottom-up design does not start with a fixed goal, but rather involves setting and implementing small, actionable rules. For example, termite nests follow this approach. Small termites have a simple rule: to pile up soil. They do this without knowing the reason, but over time, the finished structure is remarkable and sophisticated. The appearance of the Sagrada Familia church , designed by Antoni Gaudà and still under construction, closely resembles a termite nest, differing only in size. Setting goals and planning is one way to create, but actual achievem...
There are two main ways humans can generate income: sales power and volatility . Added value is continuously created through production, which involves actions to generate this added value . By adding new layers of value to basic ones, additional value is created—for example, making bread from wheat flour. The ability to persuade someone to buy this added value is known as sales power. Therefore, VAT is a tax paid by the final consumer. When sales power is strong, a significant amount of added value remains, leading to wealth accumulation . The second method is volatility. We can buy and sell assets that create either fundamental or added value. The former includes items like gold or commodities , while the latter refers to companies and assets such as stocks . Volatility occurs because prices fluctuate based on the sales power of producers, creating added value, and the balance between supply and demand for assets. Warren Buffett has avoided investing in gold because it cannot ge...