I gathered all your pearls of wisdom in one place. Look forward to your reply…
‘Duh… Worthless paper has no intrinsic value. That wasn’t too hard!’
A:Money is not paper or gold or anything else, it is a legal instrument recorded on a transferable object. Nothing is money until it is designated as such by the relevant legal authority. The mortgage on your house is written on paper, does that mean it is worthless because the paper is worthless? What nonsense! The value comes from what is printed on the piece of
paper, not the paper itself.
‘A real money is always worth something because even copper or iron money can’t ever be cheaper than the material it’s made from.’
A: I’m pretty sure this sentence doesn’t actually make sense; nevertheless refer to Greshams Law:
I don’t know where he got the idea that money produces wealth. Money is wealth which produces nothing. That’s exactly what it’s supposed to do - be a medium of exchange and store of value. Money doesn’t “extract” anything, no clue where that Perry guy got those nonsensical ideas.’
‘I don’t know where he got the idea that money produces wealth.’
‘A currency of course doesn’t produce wealth’,
A:Capitalist economics claims that money produces wealth. If it does not:
What do Capitalists claim Capital is then?
What do Capitalists claim Capitalism is about then?
What do Capitalists mean by ’ investment’?
What do Capitalists mean by ‘return on investment’?
‘…it just helps it circulate. It doesn’t extract wealth,’
A: Even in its simplest terms, this statement is plainly self contradictory.
How can wealth ‘circulate’ unless it is extracted from one place so it can be ‘circulated’ to another?
In what form can wealth ‘circulate’ if not in the form of money?
What do you understand by the term ‘accountancy’?
What do you think accounts are for?
I just tried (content below), but it requires account on the site so I’ll just post it here.
A:It does not require an account on the site simply supply your e-mail and a name.Its not difficult or complicated (well, for me at least)
1) Because this post is about the nature of money, I think you should define“money” (it seems you mean “currency” rather than “money”?)
A: noun: currency;
plural noun: currencies
a system of money in
general use in a particular country.
A:What do you imagine the difference is between ‘currency’ and ‘money’? Define this difference. If you know of any valid legal difference in the definition of currency and money please explain it. I used the term money specifically and advisedly.
2) Money (such as gold) has inherent value. You can coat airplane windows with it, enhance conductivity of connectors in your iPhone, etc. A currency can be intrinsically worthless, but then you could make it clear which one you are referring to to.(sic)
A:Gold can be used as money, but so can shells, pieces of paper etc. Money is a legal instrument. (see above). Aeroplane windows are irrelevant.
3) “It is a license, a legal permit, to extract value from within the society.”
But in a free society there’s no way to limit that. I don’t have to accept your (?) money, I can pick any of several private currencies or forms of money that circulate around.
I also can (sic)
A: -(?) For some reason you have been unable to finish this sentence- were you confused? What did you mean to say?
’ I don’t have to accept your money’
A:This is simply wrong: You do have to accept my money in settlement of debt, legally ordered payments, in payment of taxes etc etc . Look up the meaning of ‘legal tender’. The government has mandated this. Your statement is evidence of painful ignorance.
4) “If there were an infinite number of possible profitable ways to utilise money what would the effect be on interest rates? Despite the fact that there would be little or no risk, interest rates would be high.”
They’d be high because there’s more demand relative to supply. Money is supposed to be scarce, otherwise it’d be worthless or close to worthless and people would not want to hold on to it (or denominate their labour or products/services in it).
A:This does not in any way refute the point that interest rates are a product of demand, not risk; in fact you simply restate the first part of my point, albeit in a somewhat less elegant way. Then you make the strange generalisation: ‘money is supposed to be scarce’. Based on what theory?
Can you provide a definition of ‘scarce’? You suggest that people would not want to denominate goods and services in any particular money if it were not scarce. People within a given territory have no choice as to whether they have to hold the currency of that territory. They are required to hold that currency-in order to pay taxes for example, as Iexplained above. You either repeat what I say, in which case you are sort of on the right track, or else you deviate from my description and go into a ditch…
5) “And what would be the effect of an opposite environment of high risk and few profitable
ways to utilise money? Then interest rates would be low because there would be little or no demand for money.”
I’m not sure this dual (high risk + few profitable ways to utilize it) hypothetical setup is valid.
A: Really? Because that is the setup we are in right now!
If risk is high, interest will be high. That’s regardless of how one wants to utilize money. If there are few investing opportunities, interest rates would be low because of a relative lack of demand.
A:You try to characterise ‘risk’ as some invisible abstract force of nature that cannot be located within concrete tangible
reality. By conflating risk and interest you hope to glide past their supposed relationship: ‘If risk is high,interest will be high’. is a statement of religious faith dressed up as economics. There is no risk outside ofinvestment opportunities or the lack of them. If there is, show me where it is!
Currently in the world there is too much capacity in most industries worldwide, so consequently although risk is small, there’s no demand for money (actually individual currencies, but since you didn’t make this distinction I’m playing
along) simply because building another steel mill is likely to make that debt bad (i.e. you won’t make money from it).
A: ‘Currently in the world there is too much capacity in most industries worldwide’ Another meaningless generalisation! Raw material producing industries and finished commodity industries to say nothing of services, cannot be lumped together in
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