Friday, January 29, 2021

Price is not Value

Do not get too obsessed with the specific skills and knowledge which you think will provide the reward you are looking for. Price is not value. What determines how much you get paid for something is supply and demand. Price and value can disconnect for long periods and to extreme levels. The key is to disconnect your value creation from having to care excessively about price. To do that, you need to pay attention to capital and containers. Capital creates space. Containers get you paid. Space snaps the hand to mouth connection that forces you to dip into markets to care about supply and demand. A salary is just the price of your labour. The price of your skills and knowledge. Those are affected by how many other people can do what you do, and whether those paying you need/want you specifically to do the work. You do need to listen to the market to see what skills and knowledge are being rewarded now. You do need to build the capacity to adjust as supply and demand changes. The more you are able to convert your earning ability into capital, the less you will need to care about what other people think things are worth. Particularly, what they think you are worth. 



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