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The Wise Investor

As luck would have it, however, this was the same family
whose son had first begun to trade his ploughs for grain.
There was no grain to trade, as harvest time was not
complete, but the young man had an idea. He offered his
best ploughs to the other families.
In return, they would work in his family's fields and help
complete the harvest. Everything went as hoped, and all
were satisfied with the exchange. Soon, other families
realised that they, too, had a shortage of labour and an
excess of goods, or perhaps the reverse.
In no time at all, people all over the valley were working
on each other's farms in return for fees. Thus, while families
had long since exchanged their goods, they began to
exchange their labour as well.
Through these processes, the four pillars of commerce
were formed; the creation of assets, such as housing and
machinery; the ownership of assets, such as land and skills;
the trading of assets, such as grain and tools; and the lending
of assets in return for fees. On these four pillars, the society
developed into a thriving, productive community, rich in food,
shelter and possessions."
John paused, resting, while Kate pondered the story he
had just told her.
"It's a very simple story, John," she said, and yet it does
make things clearer. Still, I can't quite see how it relates to
me. I mean, the modern world is far more complicated, and I
am just a nurse, I don't buy and sell goods for a profit."
"On the contrary, my dear," John said with a smug smile,
"I am pleased to say that everything you have just said is
completely wrong."
Kate was a little taken aback.
"The society that I just described included all the
fundamental elements of our modern economic system.
There are several concepts I have not yet covered, and the
modern world has many complications, but the basic issues
remain the same.
In fact, when we look at investment in more detail, you