It seems to me that the imposition of the Euro - which was established as a purely fiat money - puts the regression theory in perspective and possibly refutes it. If «nothing can enter into the function of a medium of exchange which was not already previously an economic good to which people assigned exchange value already before it was demanded as such a medium.», how could the Euro become the medium of exchange of european countries and peoples? How was the exchange rate established anyway?
If I am wrong about this - and it's much more likely than Mises theorem being wrong - could someone explain to me why the Euro doesn't refute the theorem? i'd apreciate it.
«I believe there is something out there watching us. Unfortunately is the government». Woody Allen.
Mises regression says that any fiat money must be parasitic on prior functioning money.
in the case of the euro; all the countries had functioning fiat moneys of their own;
these of course could not have arisen without being parasitic on money prior to the national fiats.
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Alright, but how was the exchange rate established between the old fiat moneys and the new common one? it seems to me that it can only be done arbitrarily (because it is not linked to gold, it is not a weight of it). and since it is arbitrary, it was government-made. but still, we in Europe used anyways, regardless. we just exchanged our national moneys for the Euro, and went on with our lives and trusted the exchange rate.
don't get me wrong, i am truly for a gold standard (or for anything that arises in the market as medium of exchange) but maybe it is after all possible to establish a new money out of nothing, with arbitrary exchange rates.
Anything is possible that a person can be threatened to do.
individuals in the free market gave value to mediums of exchange based on the capital in the exchange. individuals still do now, but what is different now is legal tender laws and fixed exchange rates by a central bank - not by individuals in a market demanding values by their own individual advocation (free market). the central bank is left with trying to read the tea leaves of the market values indirectly; whereas the free market would provide a direct value based on the individual(s) directly involved in the exchange of the capital.
wilderness: individuals in the free market gave value to mediums of exchange based on the capital in the exchange. individuals still do now, but what is different now is legal tender laws and fixed exchange rates by a central bank - not by individuals in a market demanding values by their own individual advocation (free market). the central bank is left with trying to read the tea leaves of the market values indirectly; whereas the free market would provide a direct value based on the individual(s) directly involved in the exchange of the capital.
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'Men do not change, they unmask themselves' - Germaine de Stael
yeah, my computer broke. friends gave us a new one they had in storage. it needed blown out and then everything needed to be reinstalled. it took three weeks to do this - one of the weeks the computer person was sick. then i get the computer back and it won't connect to the internet. we call the internet service provider. they leave message to the techs to check their end on friday. called back yesterday and they say they put in wrong info so techs never got the info. tech came today. ended up being IP address numbers were given wrong over the phone by their service provider and so he corrected the address numbers and now it works. took over a month. service provider was involved in merger recently and the service has been terrible. maybe they get subsidized by the government and have no incentive.
Rui Botelho Rodrigues: and since it is arbitrary, it was government-made.
perhaps you think the regression theorem is something else than what it is.
the regression theorem says that the governments 'arbitrary and government-made transition' from one fiat to money to another was only feasable since it inolved a direct relationship to a functioning fiat money; which itself, regressing back through history, owes its feasability to the arbitrary and government-made transition from commodity money to it (the fiat).
In fact, the Euro was prepared by a special scheme of fixed exchange rates. The "Euro" existed as virtual currency for a couple of years before Euro notes and coins were introduced to replace national currency notes.
The fallacies of intellectual communism, a compilation - On the nature of power