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/biz/ - Business & Finance

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50839140 No.50839140 [Reply] [Original]

How exactly does trade create profit? Aren't you exchanging two things of equal value?

>> No.50839167

>>50839140
>Have thing
>People want it
>I charge more than it's worth because people want it
DURRR DURRR DURRRR

>> No.50839177

>>50839140
Oh shit, nobody ever considered that. You may be on to something. A Nobel-Prize worthy insight.

>> No.50839179

>>50839140
adam smith wealth of nations

>> No.50839182

not if the comparative advantage is different

>> No.50839283

>>50839140
Economy of scale. Bob and Ted can both produce 10 of product A and 10 of product B if he decides to make both, or 30 of A or B if they decide to specialize.

If neither specializes, they both have 10 of each. But if they both specialize into different things (Bob into A, Ted into B), they can trade their excess with eachother and walk away with 15 of A and 15 of B each. The exchange rate of 1:1 for product A and B hasn't changed, but both parties are richer for having traded.

>> No.50839449

it's over

>> No.50839730

>>50839140
value is subjective
for an exchange to happen both parties need to value their own item less than the one they wish to acquire

>> No.50840951
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50840951

>>50839140
this wrongly assumes supply and demand are always in perfect equilibrium
sometimes supply is short so prices go up
sometimes supply has an excess so prices go down
sometimes demand is high, so prices go up
sometimes demand is low, so prices go down

>> No.50841033

>>50839730
This. If the value was objective and universal, the exchange would become meaningless.
Plus there is the law of dropping value for multiple similar items: the first smartphone you have is much more useful than the second, and the third is almost useless for you. So exhanging the second and the third for something you don't have is a good idea.

>> No.50842414

>>50839140
>But in place where a lot of something
>Sell in place where it is rare
>Those two things have different value in those respective places
>Value is whatever anyone will buy it for
What are you even trying to say op? This is beyond simple

>> No.50842465
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50842465

>>50839283
Incorrect.
"Specialization" is an expensive process consuming resources, and/or time, and or/money.
Neither is richer.

>> No.50842732

>>50839140
Is it just me or does this question not make any sense at all? Anyways, if a product is being exported the cogs has to be below the going rate which is determined by the market (demand/supply) otherwise nobody along the supply chain gets their cut of the profit. Products with a lot of middle men have slim margins.

>> No.50842794

>>50839140
We are almost 8 billions peoplw on this planet, so each item has 8 billions different values.
A farmer will make a profit selling me a steak for $5 and Ill be more than happy to pay $5 for my steak because I dont want to raise and hunt a cow. We are both better off with this transaction.

>> No.50843045
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50843045

>>50842794
You're such a mentally retarded nigger it's actually surprising you were able to turn the computer on, find this board and post this schizophasic shit you call "your thoughts".

>> No.50843162

>>50839140
By ripping off every nation (it's natural resourses) and wagie along the chain

>> No.50843654

the point is if you have no money and you need that thing.
>loans

>> No.50843778

No because there's no such thing as objective value like communist faggots think. If you buy, the thing you purchase has more value to you than the money, and the opposite for the seller. So, you're both happier now than before, although the act of a transaction didn't do anything.

Profit naturally happens when a party simply maximizes it's value in the world. The trivial example, personal finances, you "profit", or have savings, when the things you're happy buying are less than the total economic value you provide for others. That naturally happens once you have efficiencies

>> No.50844798

>>50839140
Profit is surplus value. Which is exploitation of the proletariat.

>> No.50844847

most retards in this thread have the delusion trade produces value only to the seller; i.e. they are thieves; they only see profit by seeing losers on the buyers.

that's the opposite of the truth; in reality it's because the early sellers are losing money that it helps; the added sellers are dropping the price.

so in reality the value to society is that you make a more fair value for the community.