The best and safest thing is to keep a balance in your life, acknowledge the great powers around us and in us. If you can do that, and live that way, you are really a wise man.
- Euripides
The concept of balance permeates all areas of our existence. It is central to many key concepts in art, science, nature, accounting and economics. Art connoisseurs look at whether a piece is symmetrical or asymmetrical. Chemistry students balance chemical equations and follow the Law of Conservation of Mass, which states that the mass of the products must equal the mass of the reactants.
The scientific concepts of diffusion and osmosis deal with the tendency toward equilibrium. In the realm of nature, ecologists generally subscribe to the Balance of Nature Hypothesis, which theorizes that ecological systems are usually in a state of stable equilibrium (homeostasis) and that a small change in one part of an ecosystem can produce a reaction in another part in order to bring the system back into balance.
In the financial world, it might be said that the economic system functions (and occasionally malfunctions) according to the Balance of Nature Hypothesis as well. Economic equilibrium is achieved when supply and demand are in balance. Markets attempt to achieve balance by matching buyers and sellers. When either one greatly outnumbers the other, we experience volatility that can lead to either excessive fear or excessive greed.
When these extremes are reached, we know that something must change in order to bring the system back into balance. And what could be more essential to accounting than the balance sheet? Assets must equal liabilities. Needless to say, we will address these ideas in greater detail in the future. For now, I think I’ve beaten the balance thing hard enough. You get it. Balance is omnipresent. So what?
So often we are confronted with extremes. One group argues for one extreme and another group promotes the polar opposite just as vehemently. For most of these “this” vs. “that” debates, the truth lies somewhere in between. It resides in the balance. Like truth, balance is not usually a single point, but encompasses a range or spectrum of possibilities.
Perfect balance is as elusive as ultimate truth. We may never arrive at either, but we can certainly enjoy the journey as long as we keep ourselves close to both. This blog is about the quest for balance, but not necessarily achieving it. Many posts will feature a “this vs. that” format as a way to explore two polar ideas and arrive at some options that you can (hopefully) use to increase the balance in your life – financially or otherwise. There is almost never only one right answer.
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