Trading

June 20th, 0001:

I spent the entirety of yesterday teaching the people of the new settlement how to shoot arrows correctly, even getting them to go on a hunting trip in the wild, encountering two predators before the end of the day, and managing to redeem another 115 RP, adding my total up to 132 RP in total.

As for today, I planned just to go looking for any plant capable of numbing pain without any dangerous side effects so that I had a way to treat wounds while also minimizing the amount of pain or discomfort the person with the wound would have.

Before I could set off though, a lot of people in the original had grouped up near my house and seemed to be wanting me to fix their arrows, and although I was glad to do so, I also didn't want to be held back by it, so I had to come up with a way to help my current situation.

Therefore, I decided to take all of their arrows and get two of the people in the crowd to help me; once everyone left, I took them to where the clay was and taught them how to repair or entirely remake an arrow which was not too difficult as it was only really three steps.

Once that was done, and we had 3 perfectly restored arrows, we went back to where my house was and waited a short amount of time until everyone that had left an arrow with us came over to where we were.

At first, I was just planning to hand the first three arrows to whoever was in front of the group, but before I could do that, someone with a banana in had pointed it at me like he was offering it in exchange for an arrow.

At first, I almost instinctively rejected their offer. Still, it occurred to me that giving it to them would actually be beneficial, not because of the banana, of course, but more so because it would show the rest that goods could be exchanged for priority when it came to service.

It would be a far cry from actually paying for the service entirely, turning it into a sort of business. Still, at the very least, it would make the rest notice that unlike what they had been doing, goods couldn't only be exchanged for other goods but rather service as well, in this case, priority among the rest.

Once the rest saw this, some scrambled to get some fruit from the wild but were beaten by those who already had fruit in hand. I gave the remaining two arrows to the two people who offered the most.

Just because some were desperate to exchange fruit for arrows didn't mean everyone was though, as there were still people that simply chose to leave and do their own thing once they saw what was happening, most likely because they were just willing to wait, it didn't take too long for arrows to be repaired anyway.

Once that was done, I split the fruit we had received and gave it to the two people who had helped me as a sort of payment for their work which they accepted without a second thought. Instead of joining them in making arrows though, I decided to stay back and see if anything else would happen.

Thankfully my gut feeling didn't let me down. Unlike the two people that traded a spot in line for an arrow at the very end, the first person to do it seemed to have actually had another brilliant idea, as shown by the fact that just like I had done, he basically offered the arrow to all of those present. He ended up giving it to the highest bidder.

I was incredibly excited by this because it opened the door for people to begin reselling products basically. That mattered because once more than one person began to do so, there would eventually be competition among the suppliers.

It would only be at a fundamental level now though, as there were just 23 people. Hence, the demand wasn't exactly high enough to support more than two of the same business unless one were to add the new settlement's population to the equation.

Regardless as the day went on, a couple of people always offered the most for arrows, basically building a tiny monopoly of the supply and reselling it to everyone else and the other resellers to varying levels of success.

At first, the arrows went for a very high price, and the number of people who hoarded them was small, causing the resellers to make back their original investments. Eventually though, as more people joined in, the monopoly expanded, and things became more complicated.

Despite how well they seemed to be doing, they were actually doomed as they had fallen for the economic bubble effect. By selling to other resellers for a higher price, the resellers artificially inflated the apparent demand for the product, causing the resale price to increase constantly.

The problem was that the consumer's true demand is determined by the consumer and not the sellers making it. Although by selling to each other, the resellers could gain temporary wealth, as time passed, the actual demand from consumers would diminish exponentially as time went on.

So eventually, unable to improve the quality, they had to decrease the price to compete. Causing resellers not to make their money back as the demand did not meet the price they had hoped to put on the product, the bubble popped. Those who did not leave before it did were left at a loss, and the market they had created almost collapsed.

This was a pretty good thing though, as the next time an economic bubble presented itself, they would hopefully be able to remember to keep a better tab on the consumer demand of the product. At the same time, they only lost fruit and meat; once an economic system and bank were set up, it would not be as simple to make up for their losses.

They did still have enough time to better hold on to the concepts of supply and demand, so I believed that they would do well in the future. For now, this could just be remembered as a sucssesfull learning experience, that hopefully not only the opportunistic would be able to learn from.