scineram:A warehouse has operational costs. It even tries to make profit. Who is supposed to pay for this while the receipts are exchanged?
You've never had a bank 'service fee'?
'Men do not change, they unmask themselves' - Germaine de Stael
Anarchist Cain: malgratloprekindle:Divide and keep it that way. Use that ratio to define the dollar in terms of gold, and only create more money as more gold comes into either the government's treasury/mint, or the open market (depending on whether it's the government or the free market that has the power to coin money). So you want to enact monetarist style inflation with a set percentage? I understand it may be difficult to conceptualize that a monetary supply need not expand because the point is to increase its purchasing power, not its overall abundance.
malgratloprekindle:Divide and keep it that way. Use that ratio to define the dollar in terms of gold, and only create more money as more gold comes into either the government's treasury/mint, or the open market (depending on whether it's the government or the free market that has the power to coin money).
So you want to enact monetarist style inflation with a set percentage? I understand it may be difficult to conceptualize that a monetary supply need not expand because the point is to increase its purchasing power, not its overall abundance.
WTF!?!?!
Where did I say I wanted constant inflation? This is how new money is made via a gold or commodity standard. This has NOTHING to do with Monetarism, or inflation at a set percentage. When more gold comes in (it's very scarce last time I checked), you use it to coin more money. There would be no set %age, and the money supply would be mostly constant, save for the few times it becomes more profitable to mine for new gold...I'm aware that the point of money is to increase or maintain it's value. Don't put words in my mouth. It's bad enough I have to take shit from Harry Felkner and the other more dogmatic anarchists.
Who will pay it? And how?
malgratloprekindle:Where the hell did I say that? This is how money is made via a gold standard. This has NOTHING to do with Monetarism, or inflation at a set percentage.
malgratloprekindle:Use that ratio to define the dollar in terms of gold, and only create more money as more gold comes into either the government's treasury/mint
The goal of the gold standard is not to make more dollar bills.
scineram: Who will pay it? And how?
The holder of the gold and through established fees which can be taken out of his/her account.
Anarchist Cain: malgratloprekindle:Where the hell did I say that? This is how money is made via a gold standard. This has NOTHING to do with Monetarism, or inflation at a set percentage. malgratloprekindle:Use that ratio to define the dollar in terms of gold, and only create more money as more gold comes into either the government's treasury/mint The goal of the gold standard is not to make more dollar bills.
I'm aware of that. Again, stop putting twisting my points and strawmanning me. I never said a SET percent. I just said when new gold is found it's used to create new money.
That's how free market commodity backed money works: you only can coin new money when you have more commodity to back it up.
I feel like I'm dealing with socialists and creationists...same strawmanning, dogmatic thinking.
malgratloprekindle: I never said a SET percent. I just said when new gold is found it's used to create new money.
And the supply of goods usually goes up by 3% a year. I'm speculating but I wouldn't be surprised if gold does the same. Therefore with new gold, according to you comes new money. Therefore the production of dollars will raise to production of gold. Percent of dollars increased by percent of gold.
malgratloprekindle:That's how free market commodity backed money works: you only can coin new money when you have more commodity to back it up.
The point of having a commodity backed money is actually because it is more difficult to produce. Simply raising the money supply in terms of the increase in the supply of goods is not going to make goods cheaper which is the natural course of the free market. You want increases in the purchasing power of money, namely a high per unit value, which one cannot achieve if they are constantly printing dollars in relation to the unit.
malgratloprekindle:I feel like I'm dealing with socialists and creationists...same strawmanning, dogmatic thinking.
Self-victimization is all the rage these days isn't it?
People don't HAVE to trade their gold in for dollars, even if the supply increases.
Anarchist Cain:And the supply of goods usually goes up by 3% a year. I'm speculating but I wouldn't be surprised if gold does the same. Therefore with new gold, according to you comes new money. Therefore the production of dollars will raise to production of gold. Percent of dollars increased by percent of gold.
Anarchist Cain:The point of having a commodity backed money is actually because it is more difficult to produce. Simply raising the money supply in terms of the increase in the supply of goods is not going to make goods cheaper which is the natural course of the free market. You want increases in the purchasing power of money, namely a high per unit value, which one cannot achieve if they are constantly printing dollars in relation to the unit.
Anarchist Cain:Self-victimization is all the rage these days isn't it?
malgratloprekindle:People don't HAVE to trade their gold in for dollars, even if the supply increases.
Then Gresham's law will drive out the bad money and you can keep printing ridiculous paper without learning and bettering your practices. I like to develop institutions which will actually be sustained, but who knows that might actually just be some kind of odd subjective preference I have.
No, you can't.
Because new money can ONLY be coined with more commodity to back it up.
What's so hard to grasp about this?
malgratloprekindle:No, because people don't HAVE to trade their gold in for dollars.
Then you start something that is already doomed to fail since you knowingly inflate a currency in accordance to the gold supply while other worthwild currencies achieve purchasing power.
malgratloprekindle:That's kinda where I'm getting at...
No you are saying that the dollar supply should coincide with the gold supply. I am saying that the dollar supply should be at a fixed state
malgratloprekindle:Stop strawmanning me, and I'll stop complaining about it. Goes for the rest of the anarcho-dogmatists here.
This isn't a strawman. This is the refutation of idiocy.
malgratloprekindle:Because new money can ONLY be coined with more commodity to back it up.
And only the prices will increase. You've never heard of the 'Angel of Gabriel' model. If you double the money supply, it will only double the prices. The natural course of free market capitalism is a decrease in prices, not an equilibrum like the monetarists champion.
http://mises.org/multimedia/mp3/rothbard/R2-16m.mp3
For your benefit.
Anarchist Cain: scineram: Who will pay it? And how? The holder of the gold and through established fees which can be taken out of his/her account.
How do you know whose gold is it? It would make the receipts be not fully backed.
Anarchist Cain: And only the prices will increase. You've never heard of the 'Angel of Gabriel' model. If you double the money supply, it will only double the prices. The natural course of free market capitalism is a decrease in prices, not an equilibrum like the monetarists champion.
There is a misconception here, that should be cleared. Equilibrium between supply and demand is always something that the market works for. That's not in question when it comes to price deflation. As Jesús Huerta de Soto explains in his book, Money, Bank Credit and Economic Cycles, demand for present goods decrease with an increase in savings. The demand curve shifts to the left: there is a new equilibrium point. And then, when savings decrease and entrepreneurs begin to manufacture the lower-order good supply increases: the supply curve shifts to the right, causing a new equilibrium point.
scineram: Anarchist Cain: scineram: Who will pay it? And how? The holder of the gold and through established fees which can be taken out of his/her account. How do you know whose gold is it? It would make the receipts be not fully backed.
KO. Of course, the alternative is that the notes trade at a discount and therefore become somewhat useless as money since they'd all be trading at different values, pushing us further back into barter.
"You don't need a weatherman to know which way the wind blows"
Bob Dylan
scineram: How do you know whose gold is it? It would make the receipts be not fully backed.
Your worried about counterfeiting? Nothing can absolutely defend against that.
Jonathan M. F. Catalán:Equilibrium between supply and demand is always something that the market works for.
It tries to achieve it but it never does. The point is that increasing the monetary supply brings no social benefit. People don't eat money, they merely use it as a medium and therefore the more powerful the purchasing power the more prices lower [ also productivity and capital investment play a part but since we are talking about money then that is something else ]
scineram: JonBostwick:Easy. Warehouse receipts. You can hardly use warehouse receipts as cash. How in the world do you pay for the costs?
JonBostwick:Easy. Warehouse receipts.
You can hardly use warehouse receipts as cash. How in the world do you pay for the costs?
Electronic banking is among the most obvious solutions.
Other than that, you could have either receipts that charge the person who creates it or the person who redeems it, depending on which class tends to be more willing to bear the cost.
Peace
GilesStratton:KO. Of course, the alternative is that the notes trade at a discount and therefore become somewhat useless as money since they'd all be trading at different values, pushing us further back into barter.
Monies trade at discount today. Where is the international barter economy, wise guy?
Why are you concerned with the creation of the dollars? The wealth has already been created when the gold was mined, whether you make the dollars or not.
Stolz25: Anarchist Cain:And the supply of goods usually goes up by 3% a year. I'm speculating but I wouldn't be surprised if gold does the same. Therefore with new gold, according to you comes new money. Therefore the production of dollars will raise to production of gold. Percent of dollars increased by percent of gold. Why are you concerned with the creation of the dollars? The wealth has already been created when the gold was mined, whether you make the dollars or not.
Wealth is created from investment. Not merely because of the existence of gold. Dollars represent a medium of exchange meant to reflect the purchasing power of gold [ or at least it use to ] thus merely increasing dollars in accordance with increase in the gold supply is not creating wealth.