The relativity of values causes us to use money irrationally. I go to the supermarket to buy a $15 pen, and the clerk smiles and says, “You can buy this pen for $7 if you walk 5 minutes from here.” Then, most people walk five minutes and buy a $15 pen for $7. But if you want to buy a $1,000 jacket and the clerk smiles and says, “You can get a $992 jacket in five minutes from here,” most people simply buy the $1,000 jacket. Reasonably, walking for 5 minutes equals the effort, and the profit of $8 is the same. However, people might go to a store that sells pens cheaper, but not for the jacket, because the discount rate is too low. In other words, the relativity of comparing values makes us act irrationally. The pen’s discount rate is 55%, and the jacket’s is only 0.8%. Yet, the total amount is the same for all $8, and the effort to gain that profit is identical. Attitudes and misconceptions about consumption influence how we build wealth. - Joseph’s “just my thoughts”
Wise people don’t need managing, foolish people are unnecessary to manage, those who love you don’t require managing, and those who don’t love you aren’t worth managing. This is why I need to be more of ‘me’ rather than trying to conform to others; it also explains why the world is more likely to function properly if I take good care of myself. It doesn’t mean you have to live selfishly, but it does mean you’d better accept altruistic selfishness . - Joseph’s “just my thoughts”