[Script Info]
Title: 
[Events]
Format: Layer, Start, End, Style, Name, MarginL, MarginR, MarginV, Effect, Text
Dialogue: 0,0:00:09.43,0:00:14.50,Default,,0000,0000,0000,,- Today, we begin a series of talks on the\Nprice system. Not one market in isolation
Dialogue: 0,0:00:14.68,0:00:19.79,Default,,0000,0000,0000,,with demand in supply but how markets link\Npeople and places all over the world.
Dialogue: 0,0:00:20.50,0:00:25.16,Default,,0000,0000,0000,,A key part of this whole story is going\Nto be the role of prices. Something that
Dialogue: 0,0:00:25.34,0:00:29.37,Default,,0000,0000,0000,,you'll be hearing quite often is it a\Nprice, it's a signal wrapped up in an
Dialogue: 0,0:00:29.55,0:00:33.65,Default,,0000,0000,0000,,incentive. So we'll be talking about\Nsignals, about incentives, about
Dialogue: 0,0:00:33.83,0:00:42.96,Default,,0000,0000,0000,,speculation and prediction, and much else\Nbeside. We're going to begin with markets
Dialogue: 0,0:00:43.14,0:00:47.08,Default,,0000,0000,0000,,link in the world. We've already talked\Nabout the rose as a global product but
Dialogue: 0,0:00:47.26,0:00:52.30,Default,,0000,0000,0000,,it's not just roses of course. Take a look\Nat the product around you. An iPhone
Dialogue: 0,0:00:52.48,0:00:56.85,Default,,0000,0000,0000,,designed in California has parts from the\NUnited States, from Kentucky, from Texas,
Dialogue: 0,0:00:57.03,0:01:01.22,Default,,0000,0000,0000,,from New York. The rare earths are from\Ninner Mongolia. Some of the chips are
Dialogue: 0,0:01:01.40,0:01:05.90,Default,,0000,0000,0000,,produced in Korea and Taiwan. The\Ngyroscope comes from France and from
Dialogue: 0,0:01:06.08,0:01:12.79,Default,,0000,0000,0000,,Italy. It's assembled in China. So where\Nis the iPhone made? It's really made here
Dialogue: 0,0:01:12.97,0:01:18.52,Default,,0000,0000,0000,,in the world. It's a world phone like many\Nof the products we consume today, it's
Dialogue: 0,0:01:18.70,0:01:22.78,Default,,0000,0000,0000,,produced by thousands, hundreds of\Nthousands of people all brought together,
Dialogue: 0,0:01:22.96,0:01:29.18,Default,,0000,0000,0000,,all cooperating in order to produce a\Nproduct. Now take a look at this picture.
Dialogue: 0,0:01:29.36,0:01:33.83,Default,,0000,0000,0000,,It shows something utterly familiar but I\Nwant you to see it deeper now with new
Dialogue: 0,0:01:34.01,0:01:39.13,Default,,0000,0000,0000,,eyes. We have here grapes from Chile,\Npineapples from Brazil, Kiwis from New
Dialogue: 0,0:01:39.31,0:01:43.90,Default,,0000,0000,0000,,Zealand, all of these within a hand's\Nbreath to one another. Think of all the
Dialogue: 0,0:01:44.08,0:01:48.20,Default,,0000,0000,0000,,farmers, all the truckers, all the airline\Npilots who have worked together to bring
Dialogue: 0,0:01:48.38,0:01:53.64,Default,,0000,0000,0000,,this literal cornucopia to you. And what\Ndo we call this place? Think of the name
Dialogue: 0,0:01:53.82,0:01:59.44,Default,,0000,0000,0000,,now with a new meaning. We call it a\Nsupermarket. When you read the news or see
Dialogue: 0,0:01:59.62,0:02:04.69,Default,,0000,0000,0000,,it on television, we're often told about\Nconflict but there's another story, a
Dialogue: 0,0:02:04.87,0:02:09.41,Default,,0000,0000,0000,,deeper story, a story which is\Nall around us everyday,
Dialogue: 0,0:02:09.59,0:02:16.40,Default,,0000,0000,0000,,although sometimes it's hard to see and\Nthat is a massive, a tremendous amount of
Dialogue: 0,0:02:16.58,0:02:23.56,Default,,0000,0000,0000,,worldwide cooperation. Hundreds of\Nthousands of people from Kido to Chicago
Dialogue: 0,0:02:23.74,0:02:28.12,Default,,0000,0000,0000,,cooperated to bring the rose to our\Nhandsome young man and they did so
Dialogue: 0,0:02:28.30,0:02:32.56,Default,,0000,0000,0000,,voluntarily, on the basis of self\Ninterest, without central command or
Dialogue: 0,0:02:32.74,0:02:39.84,Default,,0000,0000,0000,,central direction. This is invisible hand\Nin action. Self interest coordinated
Dialogue: 0,0:02:40.02,0:02:46.94,Default,,0000,0000,0000,,towards the social good through the use of\Nmarkets. Even in economics we often focus
Dialogue: 0,0:02:47.12,0:02:54.72,Default,,0000,0000,0000,,on competition but the deeper story is\Ncooperation, worldwide cooperation. What
Dialogue: 0,0:02:54.90,0:03:01.44,Default,,0000,0000,0000,,markets do is coordinate the self interest\Nof many different people who ultimately
Dialogue: 0,0:03:01.62,0:03:05.14,Default,,0000,0000,0000,,have different goals, different\Npreferences, different insights, different
Dialogue: 0,0:03:05.32,0:03:11.04,Default,,0000,0000,0000,,knowledge, different circumstances. What\Nmarkets do, they coordinate the different
Dialogue: 0,0:03:11.22,0:03:16.46,Default,,0000,0000,0000,,interests and knowledge of these different\Npeople to produce extensive cooperation
Dialogue: 0,0:03:16.64,0:03:22.80,Default,,0000,0000,0000,,and mutual gain. That's one of the deep\Nlessons of economics. Thanks.
Dialogue: 0,0:03:24.71,0:03:28.76,Default,,0000,0000,0000,,- If you want to test yourself,\Nclick Practice Questions or if you're
Dialogue: 0,0:03:28.94,0:03:31.51,Default,,0000,0000,0000,,ready to move on, just click Next Video.