The Universal Law of Exchange
If you understand and apply this principle, you’ll unlock your potential
The first question is: if I asked you to describe and explain the very workings of the observable universe and all of humanity in one word, what would that word be?
My answer would be ‘exchange’.
How does light work?
How do you get money?
How did humans create the modern world?
Exchange.
Why?
Because we live in a universe that seeks balance. A universe of energy and energy cannot be destroyed, only transformed, and so exchange is the means through which balance is achieved.
Everything that exists, exists in a state of readiness, ready to transform into something else.
Light is a by-product of atomic exchange.
The modern world was created thanks to hundreds — if not thousands — of shared systems, principles, techniques, and beliefs but ultimately this ability to work together was only made possible by the principle of exchange.
This principle drives everything, and so then inspires the creation of systems that better enable exchange, systems such as money, a very effective tool for exchanging value.
‘But how do you exchange? How does one get money to move between people? I want to know because I want money. If two people pass in the street does money jump from one person to the other? What about if you stop and rub shoulders? Will the warm friction cause coins to magically pass through the air like in a computer game? What if you both rub noses like frisky sex-starved chipmunks?’
Maybe. But only if one is buying and one is selling.
‘I want you to walk past me, and for that, I will pay you. I want you to rub my shoulder, scratch my back, or rub my nose, and for that, I will recompense you with something of similar value.’
How do you build a universe, create light, make a modern world, and most importantly how do you get money?
It’s easy.
All you need is a buyer and a seller. The Attractor and the Attracted.
You buying this so far?
The universe, the world, and humanity are just, essentially, large groups of buyers and sellers. Exchanging. ‘You want this? Then give me that.’ ‘Let’s swap, let’s transfer.’
This is good because it means we humans can better survive and thrive and develop ourselves and ultimately: attain new value. Value we can pass on.
We want to eat strawberry jam, drive cars, and paint our houses but we don’t have the time or the know-how or resources to do all those things ourselves. So we divvy things up depending on our interests and skills, strengths and biases, opportunities and qualifications. Alan wouldn’t know where to start making a car but he is very good at making jam which Teresa loves buying. So Alan makes the jam that Teresa eats in her sandwiches while she is designing the car that Alan will one day drive.
‘You can make the strawberry jam, and I’ll design the cars, and we’ll create a monetary system — a flexible system of value exchange — that enables correct remuneration for all contributors because I like your jam but you can’t pay me completely in jam. I will come to your store and buy your jam, and you will come to a showroom and buy a car, a car that a company has put there because early on I helped design it, and they paid me at the time because they were confident it would sell. And sell it has.’
Money enables buyers and sellers to increase the complexity and sophistication of their exchanges but ultimately it’s all just about exchanges, of things, of similar value.
And value of course is not an objective absolute thing, it’s relative. Value needs to be agreed upon and defined at the point of exchange. If a thing is not exchanged it does not necessarily have any objective value. The value of a thing can be defined by the seller (‘those batteries are worth £4.99’ or ‘I am worth £50k per annum to an employer’ or ‘my house is worth £1 million to a buyer’) but the value only really becomes true and real and proven when the buyer agrees to buy, and says ‘yes, I agree with that value.’ Exchange is the source of that value.
Many factors determine the value of a thing — awareness, accessibility, supply, demand, etc — but that value is always, ultimately subjective and requires in many cases some form of negotiation, so that the participating parties can ask ‘What’s in it for me?’
‘We’ll give you this in exchange for that’. A trade deal, a pact, an agreement of exchange.
I’m simplifying here — and this simplification of things is helpful to see the bigger picture of what is going on on a universal level — but when we zoom in and start actually doing business with the real world, things can get a bit sticky, as anyone who’s lived on Earth will qualify.
It can be difficult to find something you can offer that others deem valuable and want to buy. We are all in sales and looking for meaningful exchanges of some kind, but inspiring and mediating good exchanges can be hard work.
Maybe you’re experiencing it right now.
Maybe you’ve just left school, or college, with an armful of debt and a belly full of anxiety and think, ‘I don’t know anything, what thing of value can I give?’ ‘I am unproven!’ ‘Why would they choose me over someone else?’
Maybe you’ve just been laid off from your long-term job with a headful of fear and confusion. Maybe you look at yourself and think, ‘What have I got? What goods or services can I offer the marketplace of human interaction?’
Maybe you’ve just read a worrying article about Robotic Process Automation or seen an inspirational film about Artificial Intelligence and you’re filled with a new perspective on how you can change up your “value offering” into a bold new phase of creative reinvention. But still, maybe you think ‘How can I parlay this motivation into action and more importantly how can I articulate this value to others, to partners and investors?’
The world is changing fast. AI and automation are on the horizon, threatening to replace humans in their thousands and deracinate trees and eat them whole, while entire industries are being lost overnight and outsourced to a teenage YouTuber from Honolulu with more followers than all the Abrahamic prophets combined, while you struggle to get a Wi-Fi signal or a slide deck working while your customers, employers, prospects and ‘friends’ cancel your meetings due to traffic issues.
You stare into the abyss of uncertainty and wonder whether to let the profound silence of chaos engulf you or whether to be proactive and start something meaningful.
You choose the latter and begin your “Heroic journey of self-development”, you write a CV or a business plan, you take it to the employer or bank and they refuse to employ or invest, so you self-finance your idea on credit cards and store your stock in the garage and a storm blows the roof off and ruins every last unit. And you wake up in a pool of cold sweat and howl at the moon.
Morning arrives and with it the sense of a new beginning.
Only now, you’re better prepared. Because you’re better educated. Even catastrophe and loss are valuable in a universe built on exchange, because, if you know where to look, you can find value any place you choose.
Catastrophe and loss provide knowledge and experience. Something is lost and something is gained. You swap certainty for wisdom. Naivety for experience. Uselessness for ability.
Stock can go bad, or get stolen away in the night. Your ‘secret squirrel’ sauce could get copied and your service duplicated by a cheaper operator. Everyone loves a bargain. There are many threats to one’s ability to make an exchange.
Buying and selling is what makes the world go round, but it’s a wild world, and taking better control of selling your true value is not that easy, and quite often hardly even possible at all.
But the more you exchange the better you become at exchanging. You learn what to exchange for what, when to exchange, and how and why and with who.
As long as you keep sane and proactive, and stay hungry, smart, and hopeful, you can find success and meaning in an ever-changing world by embracing the universal law of exchange.
In fact, having a good sense of this principle can help you better navigate and make sense of — and find answers to — the challenges that life throws your way.
The principle of exchange explains a lot. Good exchange is essentially based on balance. What do you find in every good exchange? Balance. And what happens when you push things too firmly one way? They swing back and balance out.
Look at binges and hangovers. When you drink alcohol faster than the rate your liver and metabolic system is able to process it, you feel ill and jittery. You exchange the immediate physical euphoria you get from your system’s initial response to increased booze consumption for the low you get from your system’s secondary response to increased booze consumption i.e. fatigue and queasy sluggishness caused by dehydration and the processing of toxins.
Look at sugar and insulin. You exchange the immediate physical energy you get from your system’s initial response to sugar for the low you get from your system’s secondary response to sugar i.e. your body releases insulin to bring down — and balance out — your blood sugar levels which makes you feel tired.
Look at unregulated lending and economic crashes. When you encourage people to take out loans that they can’t pay back and adjustable-rate mortgages that blow up in people’s faces, you create a climate of profoundly unbalanced exchange. You exchange the immediate physical high you get from people’s initial response to increased one-way cash flow for the low you get from the wider economic system’s response to increased one-way cash flow i.e. a global credit crunch which causes a long period of low or zero growth and increased unemployment.
If you’re too liberal with loaning money you can get into trouble, but you could argue that if you’re too conservative you won’t encourage much economic growth.
If you’re too liberal with alcohol you can get into trouble, but you could argue that if you’re too conservative with it you won’t do much dancing.
Things balance out over time — that’s just the universe’s way of dealing with things — but the better one can balance things through inspirational and well-mediated exchanges, the better for everyone, everywhere. And the universal law of exchange can be found by everyone, everywhere.
Exchange is clearly evident across all of human history, in all the trading routes and relationships and all the waves of cause and effect, large and small, that have changed the face of civilisations and societies since our ancestors started exchanging things of value. Whether those things were silks, axes, or bodily fluids. Exchange underpins biology, chemistry, and physics, and all the processes and events we see unfold in the physical world.
And even the non-physical world.
The universal law of exchange change even goes some way in explaining the often paradoxical nature of life and the wave-like nature of existence.
We desire things that we do not have. The fact that they are out of reach imbues them with an appeal. But when we get closer to that which we desire, when it comes within reach, when we see it in better detail with all its warts and flaws, and hear its naysayers and smell its breath, it becomes less beguiling.
This is why we take things for granted, why we become bored with the familiar, why we do not value that within our reach and shout at our spouses, and why we often fail to recognise our own true talents and value.
Do you know how to tell when someone has attained mastery of a discipline? They become bored with it. It’s why we adore the stone-faced rockstar, to us the concert’s new and we are completely adoring, to her the format is old and completely boring.
It’s a universal phenomenon. It’s what propels us forward through time and life. Desire, attainment, boredom, desire.
Many successful stand-up comedians secretly want to be screenwriters. And many successful screenwriters secretly want to be stand-up comedians. We want what we don’t have. We rarely feel complete and if we do the feeling is short-lived. The grass looks greener on the other side. We want their grass. ‘I need their grass. Will you swap your grass for mine?’
We are always ‘course correcting’, always seeking the new thing, the next thing, and always seeking balance.
We feel incomplete and so we seek completion.
We feel discordance and so seek harmony.
We feel chaos and want order.
Too much order, we want some chaos.
But chaos leads to confusion.
And confusion needs to be exchanged for meaning.
Our questions exchanged for answers.
If we get wronged, we want to get even.
We want resolution, a pat on the back, and a tasty biscuit.
And so our goals, adventures, and stories all have an arc to them and existence continues on as a series of peaks and valleys, a pulse.
Light is a by-product of atomic exchange, but it is also at the heart of atomic creation. What makes an atom? Negatively-charged electrons cancelling out the positive charge of the proton that they orbit. And how do they do that? Through exchange. And what do they exchange? Little bursts of photons. Yes, light. At the heart of matter (including all liquid and gas) exists a magic glue called electromagnetism. Through the exchange of light, electrical forces are balanced out to create what we call reality.
At every level of universal existence, a good balance is sought and achieved through exchange.
So, focus on good exchanges, and you will succeed in your goals.
And my second question is: what can you exchange today?
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‘Every man lives by exchanging.’
Adam Smith
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About the author: Luke Shaw is a social, conscious being. He is also a freelance writer and graphic designer with a special interest in how people can use branding to better articulate their value to the world. Luke is also the author of Give Yourself A Brand and Be More Better.