A neat and useful video indeed!

(Note: the link to Sean needs fixing.)

Profit: how much a business is satisfying people’s demands. Profit never comes before people. Profit comes from serving people.

Not to confuse things any but profit can either be subjective or objective. When I buy a Mocha, the coffee house profits objectively by the trade and I profit subjectively by the same trade. I may have gotten some objective value in the trade, but not in the same way the seller did. My gain is the subjective value of the Mocha I wanted to enjoy. that is my profit.

This relationship seems to be treated as a one sided deal, and it isn’t. Capitalism depends upon it. Any “equitable” voluntary trade, will have profit of some kind on both sides or at least a break even equity.

For instance, A has basket of apples and B has a basket of oranges. A is sick of apples and B is sick of oranges. In the open market, apples and oranges are selling for the same price. So A trades some of his apples for some of B’s oranges.

A’s value versus B’s value objectively is equal in the exchange. So why do it? Profit. A and B both profit subjectively by the trade. Both can now eat something besides what he already had, even though the objective value in the market is the same.

A = B before the trade.
A >= B AND B >= A after the trade.

Deefburger,

You use the terms subjective and objective profits. I have also heard it termed tangible and psychic profits. I have discussed psychic profits when discussing why and entrepreneur might continue in a project even though it returns a tangible loss. For example, I am a musician. Many of my musician friends talk of having jobs to support their “music habits.” Many of my friends continue in the music business at a loss because of the psychic profits. They would rather make a profit by playing but even if they do not they will still play.

But whether tangible or psychic the profit is there and actually benefits society. Some of the most creative art works have been created for psychic profits rather than tangible profits.

@Dick Fox
and
@Menckenite

I use “profit” in place of “gain”.

Gain can be either objective gain, such as the acquisition of physical property or funds, or subjective gain as Mr. Fox points out is the motivation for artistic creativity.

Both are summed when we evaluate. We look at both our objective (physical measurable) gain as well as our subjective gain.

This works for profit or loss when the gain is negative or positive.

Mises understood that the subjective evaluation could not be calculated and quantified by anyone except the individual evaluator. The nature of the evaluation is the sum of the subjective profit or loss and the objective profit or loss.

The inequality I offered is a mathematical simplification of Misian duality.