Posted on 12/13/2008 3:21:11 AM PST by SkyPilot
...Euros, Canadian dollars, anything that can be used and is still recognized as money. If the collapse of the dollar brings down all currency then we are in deep brown and smelly stuff. How many MRE do you have in your basement? :o)
Your second two questions assumes that society needs economists, writers, stock brokers and printers. The very existence of these professions is dependent on the existence of our airy type economic system. Without our economic system we're back to the seven basic professions - Prostitute, hunter, fisherman, herdsman, farmer, thief. Next you need someone to provide protection from the thieves and convince guys why they shouldn't give all their fish to the hookers. This is where protection rackets (governments) and professional nags (organized religions) come in. After that it's back to the "virtual" economy where "value" is a completely subjective concept.
You can't eat gold. At the end of the day there's nothing magic about it; it's a commodity just like everything else with a price that is relative to the prices of other commodities.
Funny - with overlays of truth! Enjoyed your comments - thanks.
As someone said on FOX today, it went to money heaven.
That's the only thing involved in this case that's going to any kind of heaven.
You can't eat gold. At the end of the day there's nothing magic about it; it's a commodity just like everything else with a price that is relative to the prices of other commodities.
And that was exactly my point-thank you. Gold IS a commodity, unlike paper money.
Gold is real money because it does have value on the market not just as money (indirect exchange) but as a commodity.
Gold is a commodity, not “real money”. Like any other commodity, it’s only worth whatever somebody else is willing to trade for it. It’s not “real money” any more than diamonds, wheat, oil, aluminum cans, beads, dirt, or anything else is “real money”, because there’s no such thing. It’s just another medium of exchange, and its’ actual value can fluctuate wildly.
Some judge is already trying to bail out the investors this guy duped. Since so many of his clients were rich and powerful, the government will probably reimburse them, and even make up the interest they missed. Rank has its privileges.
Yes, there is such thing as 'real money' one that is established on the market as such, as gold has.
Now, you are raising a 'straw man' argument by saying it's value fluctuates, no one denies that, since it represents the indirect exchange value of the other commodities in the market.
That is exactly why gold IS money, because it does represent the prices of other goods and itself can be traced to a commodity price.
That is what Mises stated very clearly in his regression theorem on money.
We can trace the purchasing power of money back through time, until we reach the point at which people first emerged from a state of barter. And at that point, the purchasing power of the money commodity can be explained in just the same way that the exchange value of any commodity is explained. People valued gold for its own sake before it became a money, and thus a satisfactory theory of the current market value of gold must trace back its development until the point when gold was not a medium of exchange.*
By that line of thinking, any commodity that can be traded for some other commodity should be considered “real money”. I think we’re talking at cross purposes here, because I don’t think there’s any such thing as “real money”. I’m not trying to argue, I just think that nothing has any value other than what somebody is willing to trade for it. That includes any commodity or currency. If I had the Hope diamond, and nobody would give me anything for it, it would be worthless. If I had a handful of dirt, and somebody gave me a dollar for it, not every handful of dirt would be worth a dollar, not even that one, except for that one time.
Currency has a recognized value, but only because it’s accepted as a measure of value, which fluctuates. I don’t know jack about economics (as you may surmise), but I know anything is only worth what somebody who wants it thinks its worth.
Ofcourse anything is only worth what anyone will pay for it.
A comodity BECOMES money when it is seen to have all around value in INDIRECT EXCHANGE.
You are talking about money retaining value.
I am not saying saying anything has to remain as money, only that money is a produce of the market and becomes such when a commodity is RECOGNIZED by the market to have that use value in indirect exchange.
So, yes there is REAL MONEY, it is the product of the market, when the market sees a use for it in that role.
I am not saying money has any more value than any other good in the market, it REPRESENTS indirect exchange of those goods.
Money hasn't any intrinsic value, it becomes money because the market sees that it can perform that role, but it must start off as a commodity itself, so that it does have a real market value, like other commodities.
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