Where I live they always predict on the radio if gas will go up or down tomorrow and get it right. What is involved in making that prediction?
In: 5
i never tried to explain politics and marcroeconomy to 5 year old but here it goes:
Your mom gives you and your brother a dollar everyday
You both want spend it all on candy
Your brother found a place where he can buy candy cheaper than you and keeps it a secret (or you just can’t go to same store). You complain to your mom and you get more money
Sometimes your mom gives more money to you, sometimes more money to your brother
You negotiate amout of money you will receve from your mom every month based on behaviour
Your brother started stockpile of candy so he can sell it to you for profit
In response you also started a stockpile of candy to sell to your brother
You both sell it only when it benefits seller most
You start give each other a credit in candy and extort services like washing dishes on mowing the lawn on each other when you can’t pay back
Effectively price of candy fluctuates over time and depends on how much candy you want to eat given month
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