TM Editors’ Note: This article discusses a penny stock and/or microcap. Such stocks are easily manipulated; do your own careful due diligence.

How does one buy something that they don’t even know about?

The answer: they can’t.

I do not believe that demand creates supply – but that the supply creates the demand (Say’s Law).

“Say’s Law” was authored by a French economist from the late 1700’s / early 1800’s, Jean Baptiste Say. 

Simply put, the law states that:

“If a businessman produces a good, then he will be keen to sell it. This production creates wages for workers and income for the businessman. Therefore, the production has increased wealth and leads to demand for other goods [employees now have their pay checks to go spend on others produced goods].

Jean Baptiste Say argued it was irrational to hoard money because ‘we are most anxious to sell it immediately, lest its value should diminish in his hands‘ i.e. inflation may reduce the value of cash. This theory assumes that all businessmen produce goods that are demanded by the market.

Another point should be made about supply creating demand. People naturally have infinite wants and needs. If it was up to them, they would have everything. But one has to show them what they will want.

Example:

Person A: Wouldn’t life be easier if we could communicate with a friend across the country immediately and hear their voices, not with written letters?

Person B: What? How is that even possible? If we do not use letters, than how would someone contact us from afar?

*Person A pulls out a cellphone*

Person A: This device allows someone to speak with someone from anywhere and immediately. You hit dial, it rings on their device, and they pick up and both of you can have a conversation in real time. It fits in your pocket and you can call them whenever you need or like. Its called a cellphone. 

*Person A goes on to explain the frequencies and radio waves and other highly complicated science that allows us to create such amazing devices*

Person B: I cant believe this – it is absolutely amazing. I want one right now. I have no idea how it was created or any of the technical stuff you told me, but now that I see it I realize I need it desperately.