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Basic Concepts in Market Dynamics

1. The Law of Commerce

Commerce is the act of exchanging one thing of value for another of comparable value. It could be an idea, a service, a product or a token, such as money. Commerce forms the building block of every economy and is an essential component to the social order.

For commerce to occur, all four of the following components or conditions must be present. If any one is absent, commerce does not exist. Nothing will be bought, nothing will be sold or traded, nothing will happen at all.

1. First, you must have a party who needs something that they cannot acquire on their own or would rather acquire from someone else, and who has something of value to trade or exchange to satisfy that need. The unsatisfied need of this party defines the Market they are in.

2. Second, you must have a second party who has something to offer which satisfies the first party's need either because they have a surplus, or because they, too, have a greater need and are willing to trade or exchange with the first party. The offer defines this person as a Marketer.

Note that the definition of both the market and marketer are momentary and apply only to the condition immediately prior to a transaction taking place. The roles are constantly changing.

3. Third, both parties must be willing to accept the deal, whether it be in the form of an exchange of money, goods for service, goods for goods (barter), a promise to make good at a later date (credit), or a threat (your money or your life). The terms which allow the transaction to take place are called the Common Medium of Exchange.

4. The fourth essential component is a place where our two parties can come together at he same time to conduct this transaction. This is called the Marketplace. In other words, no matter how much one person needs what the other has to offer. If they don't meet, the exchange will never take place and commerce will not occur.

This is the law of commerce. It is a natural law, like gravity, and is absolute and universally applicable. There are no exceptions.

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