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Cal Ewing is the patron saint of high school economics. He was my high school economics teacher, my 7th grade basketball coach, and an assistant coach for several high school sports teams that I was a part of. He had a TREMENDOUS impact on my life in so many ways. I loved his econ class. I honestly feel that it is a cornerstone of my financial content. Basic economic principles are the reason behind so many things in our financial lives.
You may not have had an amazing teacher like Mr Ewing, so I’ll give you the Cal Notes version of his class.
- Supply and demand– Is there any one concept more elementary yet so all encompassing than supply and demand? The concept of supply and demand can be used to explain just about any economic event. Get laid off? Low demand for workers vs a high supply of workers. Get something on sale? This is an attempt to create demand to liquidate a supply. Cash for clunkers? A disaster. Oh and it severely shifted the demand curve. (Side note: I think Cash for Clunkers was one of the biggest disasters of all time. Creating artificial demand can screw up on economy. Free markets ride or die.)
- There is no such thing as a free lunch– I vividly remember trying to stump Mr. Ewing on this one. He taught us the concept, and then we would fire off scenarios in which we felt there was a “free lunch”. He would inevitably prove us wrong. Nothing is free. Nothing. That free t-shirt that you received by signing up for the Care Bears credit card? Yeah, that wasn’t free. That free helmet phone that you got for signing up for Sports Illustrated? Yeah, that wasn’t free. The drug rep that comes into the doctor’s office and brings the nurses a free lunch? Yeah, that isn’t free. Nothing is free. Those airline miles, credit card points, and Groupon deals? Yeah, those aren’t free. You pay for EVERYTHING one way or another. Are you a chronic shoplifter (I was curious about that bulge in your pants)? Then prices will increase at that store eventually due to “store loss” (you stealing). So when you do pay, you will pay a higher price. Trust me. You can’t stump Cal Ewing.
- Distractions- I refuse to name names. But one of the most important concepts that I learned in high school econ didn’t come from Cal Ewing. The lesson came from the young lady that sat next to me. She taught me that no matter how much you care about the material (econ), and no matter how much you want to achieve and do well, distractions can take you off course. The distraction? Her. Whether she was whispering something into my ear or passing me notes, my love of econ was no match for a lovely high school girl (this isn’t as pervy as it sounds. Take it easy. I was a high school boy). This is how the world works. No matter how bad you want something, not the girl, econ, distractions can take a toll on you if you left them. Saving for a down payment on a house? That spontaneous trip to Chicago can be a distraction. Need to pay down credit card debt? The stock market can be a distraction, if you let it. You can’t eliminate distractions. You can only be aware of their potential, and then cope the best you can. I REFUSE to name names. And no, don’t comb through my Facebook friends to try to figure this out. I haven’t left a single clue for you, you perv.
What did you learn from high school econ?
Peter Dunn a.k.a. Pete the Planner® is an award-winning financial mind and a former comedian. He’s a USA TODAY columnist, author of ten books, and is the host of the popular radio show and podcast, The Pete the Planner Show. Pete is considered one of the foremost experts on financial wellness in the world, but he’s just as likely to talk your ear off about bass fishing.
I had Mr. Martindale for Econ (and for AP Psych) and I will never forget TINSTAAFL. I also loved our stock market project where we had to pick a few companies to “invest” in and track our stocks over the semester. It showed me a lot about my risk tolerance level, even at that age.
And speaking of distractions, I ended up dating a guy I met in that Econ class. There must be something super romantic about discussing the differences between macro and micro economics 🙂
My high school didn’t offer an econ class. 🙁
I was blessed to have two years of Econ in high school with a teacher that made the sometimes abstract econ theories very concrete. “There’s no such thing as a free lunch” was a great introduction to opportunity cost and the concept that your time IS valuable – and that gets hammered home as a parent. If I take a “free lunch” from someone, I pay for it by giving up the only quiet 30 minutes of my day.