# The Economy Summary::**The Economy** is a rather imprecise term referring to national ==Markets==. I prefer to use the term markets, however you might catch me occasionally using the term economy. The “What’s it worth?” question becomes a bit more complex when speaking of an economy. People use the Gross Domestic Product (GDP) as a common metric for the “value” of an economy. But does GDP provide any real indicator of value or even a measure of price? No. It cannot indicate value because the diverse value judgments of millions of people regarding millions of items cannot represent a measure at any level. GDP cannot provide useful information regarding prices. The varied prices of multiple goods simply cannot be aggregated. Just try to add the prices of hamburgers, autos, and cameras. You can’t do it. So, is GDP a useless statistic? No. But, you must understand what it does measure. It simply measures the number of dollars exchanged for defined categories of goods. (GDP also suffers from logical flaws, which I will discuss in another post.) "*The economy*" represents an [[abstraction]] of a highly [[complex systems]]. Does this abstraction help or hinder your understanding of this system? You frequently hear commentators talk about “the economy.” In reality, there is no such thing as “the economy.” Different people from different parts of the country exchange very different products in what we refer to as an economic market. No way exists to accurately combined these factors into a single data point. Don’t stop listening to people that will refer to “the economy,” but understand that, at best, the figures they provide represent only an index and not an accurate aggregation. # References / Links [[Understanding The Economy]] [[How The Economic Machine Works by Ray Dalio]] [[Investor Carl Icahn Issues Grim Warning on US Economy]] > [!Info]- Ignore dataview >## Backlink >Ignore this dataview. Plugins don't work on the website >```dataview Table Status, type as "Type" from [[]] and !outgoing([[]]) sort file.name asc >```