Wednesday, June 28, 2006

Ancient wisdom on trade (2)

“There must be farmers to produce food, men to extract the wealth of mountains and marshes, artisans to process these things and merchant to circulate them. There is no need to wait for government orders: each man will play his part, doing his best to get what he desires. Cheap goods will go where they fetch more, while expensive goods will make men search for cheap ones. When all work willingly at their trades, just as water flows ceaselessly downhill day and night, things will appear unsought and people will produce them without being asked. For clearly this accords with the Way and is keeping with nature.

The Book of Zhou says: “Without farmers, food will be scarce; without artisans, goods will be scarce; without merchants, the three precious things will disappear; without men to open up the mountains and marshes, there will be a shortage of wealth.”

When the Patriarch Lu Shang (Jiang Taigong) was given Yingchu as his fief, the land was swampy and brackish and sparsely inhabited; but he encouraged the women to work, developed skilled occupations and opened up trade in fish and salt, so that men and goods poured in from every side. Soon the state of Chi was supplying the whole world with caps, belts, clothes and shoes, and the states between the Eastern Sea and Mount Tai paid respectful homage to it.”
(Shiji – Records of the Historian – [YH / GY])

People may wonder why, but for more than three thousand years, the Chinese were taught how to trade.

Buy low, sell high to make some money. How? Look back at what Chi Jan (during the Spring and Autumn period) said in the first entry.

Simply put, buy shares when no one wants any, and sell the shares when everyone rushes to buy them. The shares may not be bought at the lowest price or sold at the highest, but we should be able to make some gains and generate wealth for most. It is a trade that can be learned from the Ancients.

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