Money and Mud

Considering the logical connection between money and mud: Money is like mud. Consider a pool of mud... Approach that pool of mud with a bucket. Scoop that bucket into the mud and take it out again. Watch the hole you have just made slowly disappear as the mud around it oozes over to cover it up. Wait a while longer and there is no hole left. Even longer and you cannot tell if a hole was ever made there. The pool of mud looks just like it did before you touched it. Perhaps the level of the pool has gone down a tiny little bit but that is the only change. So it is with money... We all have a set amount of money available to us. Be this through credit cards and loans or through savings. This is our pool of mud. When you purchase something with your money, you reach into your pool and scoop out the money you need for your purchase. This is the same as using a bucket to scoop out the mud. The size of your purchase determines the size (and impact) of your bucket. In making the purchase, you also leave a hole in the pool of money available to you. Over time however, the hole you made slowly disappears. Bigger purchases take longer to disappear than small ones, but eventually they all disappear (even the big ones like house loans). At this point your pool of money has stabilised again. Small pools of mud... Now if the pool of mud is too small then using the same sized bucket (amount of spending) will have a much bigger impact on the level of mud in the pool. The level may end up far too low, causing the mud to dry out. It may end up being so low that the impact of the scooped out hole is never covered over and an indentation always remains. In a financial parallel this means that we have overspent and have gone beyond our ability to repay what we have spent. This is not a good mudpile to own. Sloppy pools of mud... If the mud is very sloppy (lots of extra cash around) then the hole you make will disappear much faster. Be careful though, because sloppy mud can splash out of the bucket very easily. The level of the pool will still drop the same amount relative to the size of the bucket of course. Firm mud... Should the mud be very firm (rigid budgeting) then scooping your bucket into the pool will be difficult and the hole it leaves will never fill up again, or will take a very long time. In this sort of situation, the next bucket of mud (money) must be drawn from another place (budget allocation) in the mud pool instead as the remaining hole prevents taking it from the same place. Taking too much mud... If you take too much mud from the pool without replacing it, the mud in the pool will eventually reach a critical level. At that point, the remaining mud is too small to remain mud. It will start to dry up and crack. Once it has you will not be able to draw any further mud from that pool (financial crisis) without a new supply of mud (funds). Summing all of this up is a quote from an old advertising slogan from years back. It says something like:

"You remember the quality long after you forget the price."

And that is the relationship between money and mud.