I watched an episode of the series 'Elementary" last night and saw a very interesting business transaction… A chemist who is specialising in "Magic" mushrooms had a strong feeling for revenge, on her ex-husband. The ex-husband (a university professor specialising in the human brain and emotions) wrote a book on the psychedelic effects that "Magic Mushrooms" has on the human brain. In order for him to gather the knowledge of these effects, he had to experience the effects himself.

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This is also how he met his wife, by the way, as she was a chemist specializing in cultivating these mushrooms. The ex-husband did not enjoy the feelings experienced whilst being on the "drug", to the extend, that he actually withdrew all the copies of the books from the shelves, and destroyed them as he did not want to be part, to in any way promote the use of any type of drugs and he did not want to endorse this in any way.

So the wife re-married, -another chemist and they had a backyard pharmaceutical lab where they started to illegally manufacture medicine. They could do thusthis as the major pharmaceutical corporate organisations was charging around $55 per tablet, they could sell for around $5 per tablet and still make a decent profit. This was however not the business transaction that I as referring to. Their problem was, in order to make real money, they had to sell on a large scale, so what they did was to go to a pharmacy group or chain, which were comfortable to purchase the illegally manufactured tablets… And more importantly they needed to keep the financial transaction of the books.

So how did they do that?

The owner of the pharmacy chain bought property into a registered business, and the sole beneficiary was the wife :) I don't want to go into the detail of the actual crime and murder plot etc. As this is not the actual point of my observation.

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So why am I telling you this.

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I mentioned the book Foundations of a Free Society written by Eamonn Buttler in an earlier post. I want to reference his book again.

A free society gives people freedom to make their own economic
choices, just as it leaves them free to make their own social and
personal choices. People in a free society create value through
voluntary exchange. Free exchange makes both sides better off:
they would not do it otherwise.
Individuals prosper by cooperating with others and supplying
the products they want – and getting something that they want in
return. The prospect of gain encourages entrepreneurs to seek out
what others want and to supply it. Prices communicate information
about shortages and surpluses, telling everyone what needs
to be produced and what needs to be conserved. In this way, time,
skill, effort, capital and other resources are drawn automatically
to where demand is urgent and steered away from less important
uses. It does not need government to tell people what to do.
To function, a free economy needs only an accepted framework
of rules about how people cooperate together. These include
rules about the ownership and transfer of property, and rules of
contract under which agreements are honoured. Private property
is necessary if people are to build up businesses and exchange
goods. But it is also essential if other freedoms are to be respected.
If the authorities control all property, political action and open
debate become impossible.

My sentiment from my previous post, Free Society - How strong is the Case?, still remains same, in the fact that I believe that it will be VERY difficult to get everybody to agree to the rules in a Free Society as who will decide on these rules.

I am however more convinced that economic transactions might not be too far-fetched. I know that it is only a fictional story, actually about solving a murder, but if we take the crime out of the equation, it might just work in a real life economical world.

A chemist produced medical tablets, at the same standard as any of the large pharmaceutical corporate companies. She had to find a market in a chain of pharmacies , which required her services for cheaper medical tablets. She could easily undercut the large corporate due to their massive overheads. So she traded her tablets, which she sold on a large scale, for industrial property. For me this is exactly what the above paragraph from the book explains :) One person value for other value …

What are we doing on this platform? We are providing our time and intellectual property (which has a lot of value), in order to write articles, which we sell for a crypto-currency (which has value), which can be traded on a digital exchange (and some more value)

We are already trading our intellectual property and time as if we are in a free society. In the above scenario, we did however have a reference to how much the tablets were worth and how much a property was worth. Easy exchange, based on market value.

The problem however comes in, when one individual believes his / her value is more than the other individual or organisations value. I think it can be negotiated, but it will be more difficult to negotiate.

Fiat cross border transactions

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Let's take a real life example to highlight the difficulty and complexities of negotiating a transaction using the current fiat currencies:

I am going to use the example with Hive account@kyriacos as a role player - (Hope you do not mind Hive account@kyriacos). Hive account@kyriacos is an excellent artist, poet and web designer he is also now the Creative Director of the Robin Hood Whale initiative, which I believe benefit the community tremendously in achieving many goals. One of these achievements might be in assisting to create a middle class as suggested in my previous post How do we create a middle class, which you can still vote for by the way…even if it is past it's deadline of 24 hours. It pays out again in 30 Days :) … Apologies, I am going a bit of the point here :)

If I hypothetically ask Hive account@kyriacos to develop a website for my new company, which specialises in software development for blockchain solutions. How do we measure the value of the transaction. I live in South Africa, which operates in South African rand. So internationally business transactions is normally negotiated in US Dollar, which is 15 times stronger than the South African Rand. The problem will be that although the rate which Hive account@kyriacos are used to in his native country, is usually not in line with the rates which we are used to in South Africa. He will probably be just too expensive for me to afford just because of the exchange rate. This is one of many problems, as there a currency control, tax implications and many other obstacles which we have to cross to make the transaction happen.

Now if Hive account@kyriacos lived in South Africa, I could pay him at the normal rate, based on his value for the specific role as we measure it in South African value terms.

If we were in a Free Society, I could trade with Hive account@kyriacos, the value he provides in exactly what he believes will provide him value. We can negotiate the transaction as we please. So Hive account@kyriacos, do you want to build me a website ? :)

Final Thought

After looking at various aspects, I believe that a free economy might just work, especially if we have projects and platform like STEEM. I believe it will become easier to transact over borders. The problem will be that we will struggle to understand how to measure the value provided by each of the parties involved. We have been brainwashed to believe the South African rand is weaker than the US dollar. How on earth is this possible? When one of the larger countries goes to war they just print more money to by war stuff :) In theory this should make the South African rand stronger in comparison to the US Dollar as there is now more currency than there should be. In reality it doesn't become stronger, because somebody decide to print more money without anybody knowing. Convenient to forget to mention, isn’t it?

Your comments would be appreciated.

Happy Steeming

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