stupid money ?

[sam111]

I am curious when the government can print more money or another words in what conditions are the government/treasury allowed to make more money.

I know as the population increases they must somehow have to increase the amount of money that exists in the US...etc
Or if the population was greater then the amount of money many people would just starve to death... or all the rich people would have to live normal ...etc

Curious how this all works.

In theory the government can print as much money as it wanted. But in practice if they didn't do this correctly they would have chaos on their hands.

So do they just print enough money to keep us about 2% inflation or something.
That cann't be quite true either since we have had depressions and recessions ,...etc
Their must be strict laws/conditions that allow printing and not printing money even if it happened to kill a few people in starvation in the process.
Even so , don't get it.

I get if their is a fix amount of money then economists could analysis the flow of how the money is moving.
But if it was not fix and could be increased by some means then wouldn't everybody be asking to increase it for their own benefit when the time came for a particular person. And this would inevitable a biased system.
And thus the barter system would be the only true fair non-biased system.

 

[expat_panama]

I am curious when the government can print more money or another words in what conditions are the government/treasury allowed to make more money.

I know as the population increases they must somehow have to increase the amount of money that exists in the US...etc
Or if the population was greater then the amount of money many people would just starve to death... or all the rich people would have to live normal ...etc...

Thanks for the questions, so much more refreshing than having to hear constantly from the 'I've-got-all-the-answers' crowd.

You're right about this money creation thing being important because screw-ups make innocent people suffer and die --but hey, we're learning. Like, people don't suffer and die like they did say 50 or a hundred years ago. What's needed for starters is knowing what's going on. Money is not made by government printing. OK, maybe a little is, but most is make by folks like you and me making loans. We loan a hundred bucks and we know we've got a $100 note we can fall back on, but now the borrower also has $100 to spend. We just 'printed' $100.

The only question is do we get the $100 back without leaning too hard. Fact is that we usually do because we're smart and life is good.

 

[DSGE]

The mandate the Federal Reserve has in the Federal Reserve Act is "stable prices and maximum employment". They have complete control over one particular kind of money, called High Powered money (notes and coins in circulation plus bank reserves), to achieve this goal. The Fed very recently - around January 25th this year - announced an explicit target. They feel that the best way to achieve their dual mandate is to target 2% inflation over the medium term.

"But if it was not fix and could be increased by some means then wouldn't everybody be asking to increase it for their own benefit when the time came for a particular person"

No. Not if there are rules for how monetary policy has to behave. Most countries have an explicit inflation target somewhere around 2-3%. Normally that target is put in the act establishing the central bank. So a Reserve Bank act will say for example, "the Reserve Bank has to keep CPI inflation between 2-3% on average over this time period". So there is a law controlling how much money is allowed to be printed. You must print money such that inflation is on target.

For the Fed, the law in the act is "stable prices and maximum employment". Of course, that doesn't necessarily mean it's going to be followed. You need accountability, in case they deviate from their target. Other central banks have that to a degree, in New Zealand they can fire the governor, but the Fed doesn't have a lot of accountability. So you can still get recessions and such if the Fed doesn't do their job (such as this one).

Even then, there's no reason to believe that with an inflation target, or a fixed money supply, there would be no recessions. The best way to avoid demand-side recessions is with an NGDP target. Currently no central bank uses that. And you can also still have recessions from real factors. For example, if the relative price of oil increases dramatically, like the oil shocks of the 70s, you can still get real recessions.

"And thus the barter system would be the only true fair non-biased system"

Not true. Firstly, we need money. Say a baker makes bread and a cobbler repairs shoes. In a barter economy, two match ups have to happen for exchange to take place: the baker has to find a cobbler who wants bread, and the cobbler has to find a baker who wants shoes repaired. Both of those have to happen at the same time for trade to happen.

Now in a monetary economy, only one match up has to happen. The baker needs to find somebody who wants bread. That person pays for bread with money. The cobbler just needs to find somebody who wants shoes repaired, and will get paid in money. If the cobbler wants some bread, they just go to the baker and pay money. In a barter economy, the cobbler would have to not only find a baker, but find a baker who wants to trade bread for getting some shoes repaired.

So how do we decide how much money to print so that it's fair? Well, we make it so that expectations line up with what actually happens. We should give the central bank an explicit target, that everybody knows, and punish them if they deviate from it.

 

[zzzz]

Article I, Section 8, Clause 5, of the United States Constitution provides that Congress shall have the power to coin money and regulate the value thereof and of any foreign coins. But that is not the case. The United States government has no power to issue money, control the flow of money, or to even distribute it - that belongs to a private corporation registered in the State of Delaware - the Federal Reserve Bank.

I wonder why the strict constitutionalists are not for the abolition of the Federal Reserve. After all the constitution gives Congress the right and responsibility. I guess Congress back in 1913 decided they did not need that responsibility.

 

[DSGE]

Article I, Section 8, Clause 5, of the United States Constitution provides that Congress shall have the power to coin money and regulate the value thereof and of any foreign coins. But that is not the case. The United States government has no power to issue money, control the flow of money, or to even distribute it - that belongs to a private corporation registered in the State of Delaware - the Federal Reserve Bank.

I wonder why the strict constitutionalists are not for the abolition of the Federal Reserve. After all the constitution gives Congress the right and responsibility. I guess Congress back in 1913 decided they did not need that responsibility.

They retain that. They delegated that power to the Fed. At any point at all Congress may amend/repeal the Federal Reserve Act.

 

[expat_panama]

...the constitution gives Congress the right and responsibility. I guess Congress back in 1913 decided they did not need that responsibility.

They retain that. They delegated that power to the Fed. At any point at all Congress may amend/repeal the Federal Reserve Act.

Exactly. Power can be delegated. Responsibility cannot be delegated. Officials lie when they try to blame screw-ups on their workers, like when Clinton blamed Reno for Waco or Obama blamed Fast&Furious on Holder.

 

[sam111]

DSGE
I agree with you on most of what you are saying

Barter system takes 2 aspects and a money system you only need one (find somebody that is willing to pay)

But The problem with the money system is also that who determines what something is worth... to one person it could be worth $5 to another $500.

The point being in a barter system the worker would have alittle bit more of a say in how much the value of his work is to a particular customer.

The problem their in lies in a money system their is no correct way to price the value of something all the time. And that is it's down fall because everybody seeks to get the most money for their service/product (that is just natural) but this inevitable makes it unfair to the buyer (somebody with more wealth has a better opportunity even if he possess less skills/knowledge )
( I guess their is a biased in both systems and a problem in both systems)

I think people should be allowed to do what they want.
If they don't want to work then they should be given enough money to live (shelter/food basic stuff)
For the people that want to work the rich people should be either the hardest working, or the smartest/strongest.

If we had this in my eyes we would truely be a great society. Since we would have cured human hungry , gave everybody shelter, and gave the hardworker/most knowledgeable people alot of money for their efforts which is fair.
( the thing is doing the math out this is possible provided some people weren't so damn greedy and where more responsible about having kids (we got better about an equal balance of death/birth rates so we don't over populate) )

As for the government doesn't make money.
Then let me ask as are population grows and we have the same amount of money in the world.... how the hell will it be enough for everybody to live on.
For example say the amount of money value right now is equivalent to every person in the US can have $100 (split evenly).
Then what will happen when the population keeps growing doing simple basic math if the population keeps growing that $100 for each person would slowly decrease to $1 , $.05 ,...etc (being split evenly over the US people.... even if it was uneven you would still have tons more people poor or starving)
It will approach zero really fast (of course never truely reaching zero)...

See what I am getting at.
Weather the goverment or banks print or make money somebody has to do it to keep up with the population ... Correct?
If we had only a fix amount of money this would never work forever with out increasing money/value or dropping price of items/services.
Plus the fact new resources are found so new money should grow with the resources/work/technology ,...etc

Maybe somebody watches these statistics and is responsible for it... duno.... but the government did give use a stimulus check a year or so ago....where did they get that money.... either they are get to much taxes from us to have left over money ... or their make more money

Money is just to keep people motivated and in line.... truly money is just special paper that a party chooses to make when needed to control human chaos and other human factors....But in theory their is no true intrinsic value of money apart from it being able to indirectly get us what we want product/service wise. Knowledge and hardwork is the true value at least to me. Ofcourse then you have to analysis what means what to a particular person.... but if people thought really hard they would probably agree in saying Knowledge/Hardwork provided they where given enough money to survive

Question 2)
If that is true who is this party that is incharge of keeping up with the population.
I would believe it is indirectly the government or a branch their in.
At least indirectly by laws they would beable to control it.

Question 3)
Plus if the money was fix then why does are debt ceiling keep increasing (doesn't seem like their is a max upper bound on how much it could go until we completely lose all are money )
Basically what is a good approx. to the amount of money the US has. and others like China, japan , Europe countries ,...etc
If we are in debt then somebody out their is doing better then us (somebody not in debt ) who are those countries.
And looking at it that way wouldn't these countries have potential to become more powerful then the US.
If we are basing money on power then we would be weak in theory. ( how can we be in debt and still one of the richest countries don't get it)
Also how much debt can we obtain before other countries or people start valuing us as untrustworthy / not reliable

 

[DSGE]

But The problem with the money system is also that who determines what something is worth... to one person it could be worth $5 to another $500.

Exactly the same as in a barter system. The difference being instead of money acting as the unit of account, you use labour. "I'm willing to work 8 hours a day for three months to have this diamond", "I'm only willing to work 3 weeks for it".

Value is determined by the preferences of people. All money does is give us a common unit to label things with. Not all labour is the same. 8 hours of work as a surgeon is much more valuable to people than 8 hours of work digging holes. But all money is the same. The dollar I have and the dollar you have buy the same amount of stuff.

The point being in a barter system the worker would have alittle bit more of a say in how much the value of his work is to a particular customer.

Absolutely not. You can't tell other people how much they should value something. I can't dig up some dirt in my backyard and insist that you give me your car for it. Value is determined by the consumer. That doesn't change when money is introduced.

The problem their in lies in a money system their is no correct way to price the value of something all the time.

In a monetary or a barter economy things will be priced accurately all the time. The only difference between the two is that in the barter economy you have to think about all the relative prices. If I'm trying to sell bread, how do I price it? I have to price it in terms of meat, if I'm to trade with a butcher; in terms of corn, in case I want to trade with a farmer; medical advice, to trade with a doctor; etc. With money we all agree to use the one unit of account.

And that is it's down fall because everybody seeks to get the most money for their service/product (that is just natural) but this inevitable makes it unfair to the buyer (somebody with more wealth has a better opportunity even if he possess less skills/knowledge )
( I guess their is a biased in both systems and a problem in both systems)

Not sure what you're getting at there. Suppliers want to get a high price and buyers want to get a low price. A supplier can't just charge whatever they like for two reasons: 1) the exchange is voluntary. You'll only buy the thing if the value you get from it is worth the price. If the price is too high, you won't buy it. That'll force them to lower the price. 2) Competition from other suppliers! They all want to sell their goods, so they constantly undercut each other and try to improve their product so that you'll buy it. That drives prices down and quality up.

I think people should be allowed to do what they want.

Me too. Within limits, obviously. Don't murder me please.

If they don't want to work then they should be given enough money to live (shelter/food basic stuff)

Whoa whoa! Who's gonna be making the food and shelter? Working sucks. Why would people be working - ie, making food and shelter - if they can not work and still get stuff? Either you're gonna force people to work, which contradicts "people should be allowed to do what they want", or you've got a magic society where everybody works not for their own benefit, but just to please their fellow man, which is clearly just a pipe dream. There's no getting around reality.

For the people that want to work the rich people should be either the hardest working, or the smartest/strongest.

Unless you get given money by your rich parents, the only way to get rich (without resorting to criminal activity or lobbying the government for special rights) is to do something that other people want. It's not like you invent the computer and money just starts appearing in your bank account. To get rich you have to produce things people value, a lot. I'm reminded of this famous quote from the Wealth of Nations:

"...and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was not part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it."

As for the government doesn't make money.
Then let me ask as are population grows and we have the same amount of money in the world.... how the hell will it be enough for everybody to live on.
For example say the amount of money value right now is equivalent to every person in the US can have $100 (split evenly).
Then what will happen when the population keeps growing doing simple basic math if the population keeps growing that $100 for each person would slowly decrease to $1 , $.05 ,...etc (being split evenly over the US people.... even if it was uneven you would still have tons more people poor or starving)
It will approach zero really fast (of course never truely reaching zero)...

Ahhh, careful. Two things are being conflated here. You're thinking of wealth. "Money" is the medium of exchange and unit of account. So "money" is used to make trading easier. Instead of those two match ups we discussed before, we only have to find one; and it's the unit that we denominate value in. So instead of going to the store and trading a loaf of bread for some surgery (how would a surgeon buy bread in a barter economy?), a surgeon performs surgery on people who want it and gets paid in dollars; goes to the store to buy some bread and pays for it in dollars. And money also gives us a number. The bread costs "$2".

Wealth is the real stuff. The things we make, the services we perform. You can't print wealth. It has to be made by people creating things that other people value and trading. That stuff grows automatically with population growth and technological progress.

So what happens if the government keeps the money supply constant? As there's more stuff being made, but the same amount of "medium of exchange" floating around, prices will fall. That's it. Prices will fall so that the same amount of "money" can be used to facilitate trade. If we print too much money, it doesn't create more wealth. It just raises prices.

That being cleared up should help answer questions 2 and 3.

 

[sam111]

Yes , but to the normal person if he sees a drastic change in price like $100 for each person go down to $.05 for each person. This will make him change his behavior.

I agree with you again about most of the things you are saying.

Money is just really a label for how much wealth somebody possess. And I do see it freeing up the chaos of trying to have to determine what is of more value or what should be equal....
even though in some case money fails at that. (but the point is it works relatively efficient to keep the chaos of buyer/seller in agreement. )

Also don't forget at some level somebody has to set the price of an item and in that case that is just getting back to the barter system.
But it still is a great way of abstracting things in a clever way so the majority of the people buyer/sellers don't worry to much about the details of what a particular things value should be.

In theory their is no real true fair way to put a price on a value and have it agree with what everybody thinks is correct number at all times for it.
And this is the essential problem of why a society under any type of goods/value system won't be perfect or will have flaws.
The only true perfect society would be based on good will and helping others (and people will never agree to it, and the reason why it would fail for the most part is people dislike, disagree ,...and don't have the same goals , "THE BIGGEST PROBLEM USUALLY IS PEOPLE CANN'T REACH A HAPPY MEDIUM" )
So we are F'ed. I do think something of humans should be more controlled like birth rates we shouldn't overpopulate or get to a point where it is chaotic levels it should be at a level where everybody controls the problems they create (or the major ones, for example children , crime ,..etc)
Only then we could at least control the world/US in a more fair way.

I believe anybody should be able to walk into a health care or doctors office and get fix for free ... cann't put a price on health quality of life, food should also be free , and shelter should be free, the rest should be paid for. (anything that a human requires should not be based on money i.e are basic needs)

For example a human that cann't work due to health or other reasons should not starve or freeze to death... point being money should only come in when it comes to non-basic needs. The basic needs everybody should be allowed a fair amount of food / shelter at no cost. Now if you wanted a particular big house or types of food like ton of prime rib that should cost... but a basic amount should be free.
This would cure human hunger in the US as well as homelessness provided we keep population grow managable.

So essentially any system other then money that could create a standard way to have buyers and sellers in agreement, or what is a fair value for of judging something worth would work.
In theory if somebody figured out a system that did this better then money system did we would essential be better in using that system...if we could translate the people to that system in a non-chaotic way.


I still don't get why we have debt ceiling ,...etc that would imply we are oweing people,countries more then we have gave.
Another way to look at it is that means we owed people values/service/product.
I would think debt only accrues if it is from outside the US since if it is are own debt from with inside the US in a particular area we could just say F'it and start are debt back to zero provided the parties agree.

How did we accrue so much debt when other countries have not ?
It seems over the years US has helped out alot with foreign countries , I guess you could say the opposite. But by doing the rough quick math it would seem they cancel out or we should be at alot less of a debt then the numbers at?

Either the other countries are not valuing are help as much ( in that case stop help or interfering or using that country )

I guess it comes down to what the other countries valued ....
Hell couldn't we just turn it around and say we don't value what you do for us as much that would indirectly cut are debt down.

 

[DSGE]

Yes , but to the normal person if he sees a drastic change in price like $100 for each person go down to $.05 for each person. This will make him change his behavior.

Why would it? Either way, nobody would see that much deflation in their life time.

Money is just really a label for how much wealth somebody possess. And I do see it freeing up the chaos of trying to have to determine what is of more value or what should be equal....
even though in some case money fails at that.

Like when?

I still don't get why we have debt ceiling ,...etc that would imply we are oweing people,countries more then we have gave.

Not sure what you're saying it's implying...

It's to stop the government from borrowing too much. Government debt is, after all, just future tax burden. It's implemented very poorly though.

Another way to look at it is that means we owed people values/service/product.
I would think debt only accrues if it is from outside the US since if it is are own debt from with inside the US in a particular area we could just say F'it and start are debt back to zero provided the parties agree.

No, because not everybody lent to the government equally. Imagine a country with 5 people. The government wants to borrow money, so they sell a Treasury bond to person 1. 10 years later, what has to happen? The government taxes all 5 people to pay back person 1. It's not like... owing yourself money or anything. There's no accounting tricks going on.

How did we accrue so much debt when other countries have not ?

Other countries have.

It seems over the years US has helped out alot with foreign countries , I guess you could say the opposite. But their way doing the rough quick math it would seem they cancel out or we should be at alot less of a debt?

Don't know what that means.

 

[sam111]

Not everybody can be in debt ?
Why the F do we borrow / use other countries so much when we have the ability to do everything / mostly everything for are self's ... we should be the ones the least in debt.
And if we some how stupidly got in debt with the amount of things we have / abilities we possess I am sure the company/country we are in debt to. We could easily find something they value that we could pay off are debt with relatively quick... come on

So why do we use other countries so much is it we are just lazy or don't want to do it.... (which is not always bad)

Also
I believe anybody should be able to walk into a health care or doctors office and get fix for free ... cann't put a price on health quality of life, food should also be free , and shelter should be free, the rest should be paid for. (anything that a human requires should not be based on money i.e are basic needs)

Basic needs shouldn't be something that is factored into costs they should be givens that anybody has equally with no cost.
And to deny people of their basic needs in any way or fashion is sick. ( some people cann't work, cann't find jobs , are born sick ,...etc)
Living a life completely worried about making enough to remain a live is sick. Remember not all people are born into the same level and not all people are equally made on equal levels. So let us at least make things that people need to live a life available for free at some level so that people at all level don't have to worry about human hunger/shelter/heath.... think this is stupid to have to worry about.

In these case good will should just be the factor of what we run on all less can be up for war sort of speak.

For example a human that cann't work due to health or other reasons should not starve or freeze to death... point being money should only come in when it comes to non-basic needs. The basic needs everybody should be allowed a fair amount of food / shelter / health at no cost. Now if you wanted a particular big house or types of food like ton of prime rib that should cost... but a basic amount should be free.
This would cure human hunger in the US as well as homelessness provided we keep population growth managable.

Ya, I agree some people will not work or work when they want to which should not be looked at as a bad thing (laziness is not bad or a crime)
Don't forget some people work because they enjoy it as well and would work even if they where getting a little less ( even though they should be getting more)

Point being is people should have a choice on when or if they want to work and not have to rely on work to sustain their lives (from death)

Something should be viewed as bad or unethical if it is breaking a significant law or violating a trust...etc .
To many people start to compare their selves with a "O this guy is lazy he doesn't work hard at all" as that where a bad thing... they have to remember not everybody is working for the same goals.... and no one goal should be judged to be better then others in all case.


So essentially any system other then money that could create a standard way to have buyers and sellers in agreement, or what is a fair value for of judging something worth would work.
In theory if somebody figured out a system that did this better then money system did we would essential be better in using that system...if we could translate the people to that system in a non-chaotic way.

 

[DSGE]

Not everybody can be in debt ?
Why the F do we borrow / use other countries so much when we have the ability to do everything / mostly everything for are self's ... we should be the ones the least in debt.

Yeah, lots of people are concerned about the size of government debt. But why does government debt happen? It spends more than it takes in in tax revenue. So either you have to raise taxes, in which case you have to ask yourself if the government is spending your money better than you are; or you have to make cuts to the military, medicare/medicaid, and social security.

I think you should change from social security to superannuation (mandatory savings accounts), move to single payer healthcare, cut the shit out of the military, and see what happens from there (it's a long term problem, not a short term one).

Also
I believe anybody should be able to walk into a health care or doctors office and get fix for free ... cann't put a price on health quality of life, food should also be free , and shelter should be free, the rest should be paid for. (anything that a human requires should not be based on money i.e are basic needs)

What do you mean by free? Nothing is free. You think a doctor will work a 30 hour shift in a hospital or perform surgery for 6 hours for nothing? You think farmers are going to wake up before sunrise and perform hard physical labour all day only to give away their produce for free? Who are these angels who'll not only forego any reward for their production, but will incur massive personal costs in doing so? Unless you plan on holding a gun to their head and forcing them to do it, the question isn't whether or not things should "be free", but of who pays the cost of them. Individuals who use the goods and services, or society in aggregate through taxation.

So essentially any system other then money that could create a standard way to have buyers and sellers in agreement, or what is a fair value for of judging something worth would work.
In theory if somebody figured out a system that did this better then money system did we would essential be better in using that system...if we could translate the people to that system in a non-chaotic way.

You still aren't recognising that money is just a place holder. It doesn't create wealth. It doesn't destroy wealth. All it does is facilitate trade. It's taking a barter economy and improving on it by opening up a whole new world of possible trades. Doing away with money means closing off the options to make those trades.

You still haven't explain exactly what it is you think is wrong with money. Yes it would be nice if people could have lots of things cheaply. Optimally we'd have infinite resources and robots to process them and everything would be free and nobody would have to work. None of that relates to money.

 

[sam111]

Indirectly it does relate.

And in the future how do you know their will be enough jobs to go around.
So the people with out jobs are suppose to starve... wasn't their falt that they where born into a shit world. Created by people over population the world.

I think your wrong totally. You are so dependent on the fact that the money system is the way to go.

You make it sound like everybody hates to go to work.
You make it sound like people don't want to help their fellow person....etc

You are not explaining debt correctly either. Why the f would we have it if it was not based on money or values. I would just say f you I am not paying my debt to you countries I helped you out over the years thats enough (no more debt). Of course then we would have to do it all are selfs freeing up more jobs for are workers... whats bad about that.

Point being is how the world work's to how it should work
Point being is how people should treat others/act/etc to how people really act.

Point being public speech sounds great but do they really mean that or are they blowing smoke up are ass.... just to look good or get something out of it.

I agree your way is probably the best current reasonable way to mange some sort of fairness but people are not create fairly.... should those people be denied a good life simple because they are sick or cann't find work.

This discussion is getting into a more philosophical / religious / belief argument and will get us no where.

Would you want to be the one denying a sick person a treatment simple because he would never beable to pay it off.
In theory everybody would feel bad but nobody usually does anything about it.... why because I don't have any money from you...
The true way to live is not by money/value ...it is by your belief and emotion to some extent.

I belief people should just think differently about what / where we are going an trying to make everybody live equally as oppose to say I did X amount of work so I deserve Y amount of $ /values .... and I would be mad if I didn't get these.

Me I could give a shit if I worked 2 minutes or 40 hours a week provided I had the ability to get what I wanted and needed at any time.
And let me tell you what I need and want are not that much by most peoples standards.

Also think about this if you believe the money system is the way to go and their is nothing better. Then why do we even have economists
the whole point of their job is to analysis the transfer of resources in a sense. If their was no better way then we wouldn't have to analysis it any more just let it go. (because it would in theory be the optimal solution system)
Point being is that money system needs improvement and maybe a change in the system would be better if it did all of what the money system would do and more...

Obviously an system we will have some flaws or improvements and some systems would be better for different people. But I think the goal is to reach an agreement between everybody or majority of people .... and if it is the money system so be it.... but I think I can do much better.

But maybe if I had a chance I would see I was wrong maybe not. Point being is you don't know it until you tried it.

 

[DSGE]

Okay first off, you don't need to worry about there ever being "not enough jobs". For as long as people continue to want things, there will continue to be jobs for everybody. In the short run, shocks to the economy can cause some people to become unemployed. These are called "recessions" or "business cycles". In the long run, the economy always returns to what's called "full employment".

You make it sound like everybody hates to go to work.

No, not that people hate to work. It's that working is costly. There are other things you could be doing with your time that you prefer. Rather than working 8 hours a day most people would prefer to not work 8 hours a day. Sure, some people like their jobs. But the bottom line is that the reason most people work is to fund consumption. We work so that we have income to buy things. If we didn't need income to buy things, we wouldn't work.

You make it sound like people don't want to help their fellow person....etc

Well yes. You can help your fellow person in the current system! Everybody works and gets income. We can all very easily give large portions of our hard earned income to other people. There is nothing at all stopping the system you're suggesting from happening now. But it's not. Why not? Because people are mostly self-interested. They perform work for their personal gain. Saying "people should behave the way I want them to behave" is futile. You've gotta face reality.

You are not explaining debt correctly either. Why the f would we have it if it was not based on money or values

Debt is just when one person foregoes consumption now to consume more in the future. Debt happens in barter economies too. "You give me 1 bushel of corn now and I'll give you 2 bushels back in 6 months". That's debt.

There is no difference between a barter economy and a monetary economy in terms of all this stuff. Debt is the same, prices are the same, everything is the same. The only difference, the only thing that money does, is act as the "medium of exchange", and it's something prices can be quoted in. I say "the only thing", I mean that's a huge thing. That makes a gigantic difference in terms of the number of trade possibilities that it opens up.

Do you understand that money makes no difference to the real side of the economy?

Also think about this if you believe the money system is the way to go and their is nothing better. Then why do we even have economists
the whole point of their job is to analysis the transfer of resources in a sense

How are prices determined? Why are some countries richer than others? What happens if we set a minimum wage? What happens if we tax a good? Why does unemployment happen? What's inflation? Why does that happen? Can the government do better at providing some goods than the free market? Why are banks so important? What makes our standard of living grow?

You really think all economics is just about "monetary economy vs barter economy"?

The thing is right, you say "if there were something better than a monetary system"; you haven't actually explained what's wrong with a monetary system. All the "problems" of people not working for the benefit of their fellow man and debt and whatnot all equally apply to barter economies. The only difference between them is that money acts as a medium of exchange. What exactly do you think is wrong with that?

 

[sam111]

I agree with most of what you are saying (I know economists have many more questions to worry about but in general they are all inter related fix a few fixes many others but you are right in this )

I also agree the money system and barter system you can have debt and I don't see barter being better the money or visa-versa. Only that money system gives you that medium.

What I don't agree with you in is this

1) I think their is a better system then any system we have in place
2)

How are prices determined? Why are some countries richer than others? What happens if we set a minimum wage? What happens if we tax a good? Why does unemployment happen? What's inflation? Why does that happen? Can the government do better at providing some goods than the free market? Why are banks so important? What makes our standard of living grow?

From a philosophical point of view many of these important questions will never have a complete solution. To many factors and to many cases... so then let me ask should we go by suits the majority of people the best? (even this question would doesn't have a correct answer ...basically should we do the saying kill a few save a thousand ?)

Point being economists can try to solve these question but they never will.
Point being is we can never have a system completely fair for everybody on ever level.
Point being what the direction we are headed what is the meaning of life and is their some direction humans are trying to get to. (I think it would be knowledge in alot of case we are curious creatures)

I don't agree with

Okay first off, you don't need to worry about there ever being "not enough jobs". For as long as people continue to want things, there will continue to be jobs for everybody.

The jobs/positions could (and will) always be less then the wants of the people.
For instance as we get more computerized capabilities that will put all assembly line workers , or delivery people out of business... point being is the jobs we can do for free will out way the people we need for jobs.
As well eventually alot of people will reach a quality of living that they are happy with they won't care so much about wanting/buy more new things at a rate that would be good for economic . (some will but the majority just seems like they won't)
Let me ask you when finding a job has ever been easy in the last 5 years or so... seems to me it is on the upwards of getting harder...even if some years are better then other.

Ultimately as the population increases , quality of life increase to a level where most people are content and don't by stuff as fast. Then what simple not as many jobs needed to support the whole population. The point being is only a small portion of the human population can be used to support the whole population. That and the fact that companys want to hireless and get more.... what do you think is going to happen hummmmmmmm?

And yes if humans where so stupid an self centered , just helped others for the sake of helping the world would be a better place..... Your saying money system doesn't bring problems (ya, right most of crime in alot of places is caused by money or the lack of somebody being able to get something he needs/wants ... but more so need)

Point being their is good and bad with any system and effects people differently in different ways.


When I talk about debt I am talking about what we owe other countries... By may calculation we should owe them shit. We have helped many of them in the past.
And even if we owe china or few other I would think it would be that much....I would think to pay it off would just be equivalent in doing the exacr samething in reverse to them.
I.E giving them manufactured goods , or a little oil ,..etc

So when politicians talk about US debt I just laugh pointless... just go out ask them what the f they want in return , agree on a reasonable thing, and do/give it to them. DEBIT NO MORE.

And if you are going to say well it is alittle more complicated then that well know it isn't provided you can reach some sort of an agreement on what they think is a fair replacement to clear up debt. ( and don't tell me they want more then we can give them... in know way did we ever use them to the point where we cann't fully pay them back with enough of some value they want... hell in most cases we have the most valuable stuff in many peoples eyes )

That solves the debt problem.

The system money , barter ,...etc that we should use and the important questions that you
posed above. Are question that cann't fully be answered so lets not go their.
But debt has a solution
How are prices determined? No solution depends on an agreed upon by eveybody
Why are some countries richer than others? No solution depends on what you value has more worth. (obviously alot of people value similar things at some level but no full solution)
What happens if we set a minimum wage? Has an answer depends on the system we are using, how much population their is , job openings ,...etc
What happens if we tax a good? Similar to wages question
Why does unemployment happen? This has an answer many factors you could analysis the system of government , and what most people value in the large ,...etc
What's inflation? Another question this has an answer based on the majority behavior of humans
Why does that happen? behavior, wants , needs
Can the government do better at providing some goods than the free market? Maybe depends on what you define as better (better for one person is not better for another)
Why are banks so important? The illiusion of money and the storage of money everybody relies on them to take care of their money to some extent.
What makes our standard of living grow? Knowledge

The point being the subjects of philosophy , economics , and politics are tied in together and they all rely on answering question that don't have an answer. So these subjects can only gather information and make best decisions for the majority of the people.

Not that it will be the correct decisions that would be impossible to say.

SO it comes down to answering questions about are beliefs , values . needs , point to life,...etc
Questions that cann't be answered with a general answer these are personal questions that differ for everybody.

The best we can do is sit down if everybody get their views, formulate axioms that are truths that we base all all proofs on and go from their. Of course everybody must agree upon these axioms for the most part.

That is the problem because their is no way to make an axioms that everybody agrees with to run the system on.

Agreement will never be fully met.
Plus people change their mind as well under different situation.

In some sense a form of government is no better then the survival of the fittest.
Goverment depends on a group of people meeting some type of agreement ... as time goes on and changes occur .. that agreement could be broken... and either one a new form of goverment must be agreed upon or chaos surivial of the fittest occurs.

 

[sam111]

The question that I have is who is responsible for make sure a price on a particular valued item is price correctly. Or in a fair way.

Like in theory if I opened a business If I made my own bubble gum I could set the price to whatever I wanted in theory.
Correct?
Is their anybody that would stop me from setting it to something ridiculous?

I know finding a buyer would be almost impossible but forgetting that for now.
If I wanted to open a business selling gum for $10,000 a pack is their any law stoping me on setting its price to whatever I wanted?
(if their was a law it wouldn't in theory make since because it would contradict the point of value )

I know I wouldn't get any customers but could I set the price to whatever I want?

 

[DSGE]

The question that I have is who is responsible for make sure a price on a particular valued item is price correctly. Or in a fair way.

Like in theory if I opened a business If I made my own bubble gum I could set the price to whatever I wanted in theory.
Correct?
Is their anybody that would stop me from setting it to something ridiculous?

I know finding a buyer would be almost impossible but forgetting that for now.
If I wanted to open a business selling gum for $10,000 a pack is their any law stoping me on setting its price to whatever I wanted?
(if their was a law it wouldn't in theory make since because it would contradict the point of value )

I know I wouldn't get any customers but could I set the price to whatever I want?

First off, this isn't related to a monetary economy. Prices exist in barter economies, it's just instead of all prices being quoted in "dollars" they're quoted in terms of goods and services. There's nothing in a barter economy stopping somebody from making bubble gum and charging 1000 hours of labour for it.

Yes, anybody can set any price they like. So what? The entire point of the price mechanism is that through competition in the marketplace and the fact that exchanges are voluntary (you can't force somebody to pay $10,000 for some gum), prices automatically adjust to an equilibrium. If you've made gum and are asking $10,000 a pack, while your competitors are charging $1 a pack, you won't survive in the market place. You'll either have lower your price to the market equilibrium, or not sell any gum and go out of business!

The cool thing about markets is that you don't need a social planner setting prices. Forces of demand and supply automatically move prices such that resources are sent to where they're valued most.

 

[sam111]

Yes, anybody can set any price they like. So what? The entire point of the price mechanism is that through competition in the marketplace and the fact that exchanges are voluntary (you can't force somebody to pay $10,000 for some gum), prices automatically adjust to an equilibrium. If you've made gum and are asking $10,000 a pack, while your competitors are charging $1 a pack, you won't survive in the market place. You'll either have lower your price to the market equilibrium, or not sell any gum and go out of business!

The cool thing about markets is that you don't need a social planner setting prices. Forces of demand and supply automatically move prices such that resources are sent to where they're valued most.

well, I agree with most of what you are saying.
But when you say

Yes, anybody can set any price they like. So what? The entire point of the price mechanism is that through competition in the marketplace and the fact that exchanges are voluntary (you can't force somebody to pay $10,000 for some gum), prices automatically adjust to an equilibrium

Sort of correct, by good advertising , availability, convince ,..etc other qualities you probably can still do good setting the price a little high in some circumstances. ( look at the guy that made the pet rock he's a million are and do you think is product was worth as much as he obtained for it... Many people have done the equivalent of what he did and went broke or made no money/little money ... point is the reason why somebody makes it with a product or not has alot to do with public awareness and marketing it well.... I do agree alot of good products sell them selves but not always )

Plus what happens if somebody setup 2 companies one with really low prices one with higher then normal prices .. he could still manipulate people into buy stuff using psychology to some extent... obviously the smart person that knows this stuff can see thru it.... But still most people cann't.

Point being marketing/advertising go along way sometimes to affect the price.
See it alot when I have to buy a car , bed ,...or any other pretty large item.... assholes try to rip people off cars that should be price at 20,000 are price at 24,000 and when they say you can have it for 22,000 you feel like you got a deal... when really the raw worth of a car is maybe 10,000 to 15,000.... point being this is not at all fair ...

Because for prices to be fair in all cases or most cases their must be a reasonable way to estimate how much the raw materials, time ,...etc took.... and if one person is telling me 24,000 and another 20,000 what they hell.

Point being the money system is not fair and is biased to the rich. ... in that the buyer can hold out for the guy that is going to pay the most.
Ya, it works both ways to some extent but more so favors the seller then the buyer specially when the buyer has no frame of reference on what a fair price is.

Just look at an auction who usually get what they want the person that has the most money. (provided all people value the item under consideration equally)

And no not everybody will go with the cheaper deal since they may not be aware of the cheapest prices. People have to have a frame of reference of what a fair price for a specific value. Or their is going to be problems. (AND THEIR IS)


The only fair way is to give the people a frame of reference to a price range ... in the barter system it would be equivalent to making people aware what it takes to make or have a particular product manufactured (i.e time, resources,...etc some sort of paper listing what was done in an understandable way that the majority of people will know how to interpret. ( so they can base on that how much their range /value of the product it is to them ) That will even out the playing ground.

 

[Wedn]

In this entire discussion I have not seen the term 'Capital' mentioned once. It is the single most important term in our modern economic reality and has upon monetary theory the weight of the world.

 

[DSGE]

In this entire discussion I have not seen the term 'Capital' mentioned once. It is the single most important term in our modern economic reality and has upon monetary theory the weight of the world.

Probably because it has nothing to do with the question. We're talking about getting rid of the medium of exchange, not production.