I Love Arbitrash!
Arbitrage, in economics, is when someone trades commodities in such a way as to realize a profit from the price differences within or between markets. Arbitrage involves, essentially, taking advantage of opportunities for profit with little risk. This might be seen as sneaky or underhanded, but arbitrage actually helps stabilize prices across a market, by neutralizing any glaring price inconsistencies. Arbitrage is great, because it demonstrates a wonderful market niche that derives maximum efficiency from the available resources.
When wealth in the form of goods, such as clothing, appliances, or furniture, is obtained basically for free, because it has been deemed useless by a previous owner, I call that “Arbitrash.” It may be trashy, but it sure can be profitable in the form of physical wealth obtained for little or no money. Examples of arbitrash include thrift stores (whose primary merchandise consists of old clothes that people wanted to throw away), money paid for cans at a recycling plant, getting furniture or scrap metal out of the trash (or next to the trash), Dumpster diving, and hand-me-down clothes.
Especially when many people are worrying about their financial futures, arbitrage begins to look better and better, because it entails being resourceful and paying attention to sources of wealth that are being ignored. In the days of the Great Depression, people were forced to adopt this mindset, and they summarized it with a popular saying: “Use it up, wear it out, make it do, or do without.” I have to admit that I love this little poem, because it makes me feel like I can go shopping for free! You may have surmised from this point that I am quite a tightwad. As a youth, I loved reading the The Tightwad Gazette, a newsletter published by Amy Dacyczyn, the Frugal Zealot. Amy’s creative, miserly wisdom is just the thing to help folks with recently shaky finances make the most of their resources — and, more importantly, to prepare for a future of miserly, financially responsible spending.
As an example of how Americans might be more open to accepting the idea of arbitrage, the online marketplace Etsy sells handmade items, many of which are clearly made from trash (and don’t try to hide it). They even have a word for this: “upcycled.” The term implies that what was once just trash becomes something better and useful, or beautiful. In other words, wealth created from waste. This listing even advertises:
Be prepared for the uncertain future while keeping waste out of our landfills! This item is 100% made in the USA.
This listing says it more concisely:
Sustainable is the new classy!
Some of the worst items marketed on Etsy are recycled as digital arbitrash in the form of Regretsy, a blog highlighting hilarious handmade products. The blog not only entertains readers and pays the bills for April Winchell, its author, but it also raises money to fight childhood cancer, and increases Etsy’s web traffic by way of many links to items for sale. In fact, many Etsy crafts featured on Regretsy sell for high prices, because so many people want to own the item, sometimes made out of trash, that was mocked by Winchell. Regretsy aside, I’m not making fun of the Etsy sellers for making stuff out of trash; instead, I am applauding the wealth creation that occurs when people are allowed to dream up their own market niches.
The wonderful thing about arbitrage is that it takes waste and transforms it into wealth. For example, from The Myth of the Robber Barons, the Show-Me Institute’s book club learned that when Benjamin Silliman, Jr., refined crude oil into kerosene as a substitute for the whale oil commonly used to light lamps, he also created paraffin and gasoline as by-products. I guess he wasn’t such a SillyMan after all.