Comments on: Comments on Comments #1

By: Tony

Tony — Sat, 29 Dec 2007 13:49:18 +0000

One point within the gold standard (i.e. voluntary exchange) vs. fiat currency I’m interested in is efficiency. How does that factor in the former, since it clearly exists in the latter?

P.S. I like this “Comments on Comments” idea.

By: Francois Tremblay

Francois Tremblay — Sat, 29 Dec 2007 13:31:11 +0000

Oops, you sure walked right into that one viz smoking. Since we’re against work hierarchies, the argument that employees rights are fundamental is correct because all businesses should be self-managed.

By: David Z

David Z — Fri, 28 Dec 2007 22:16:13 +0000

M2 at something like $7T (or half of GDP) doesn’t much change my underlying argument, I probably should’ve looked that up instead of GDP. As wealth (i.e., output) increases under a commodity standard and a relatively unchanging money supply, prices tend to decline.

Federal reserve notes are only valuable because a government declares that you must accept them as valuable, enforced by a gun; and people are generally prohibited from dealings in anything other than FRNs for the large majority of transactions.

The absence of fiat money does not mean that money or exchange ceases to occur, only that people trade things mutually accepted as valuable for one another. Historically speaking, this has been gold, but it need not be gold. My advocacy for gold should be taken in this context.

By: KipEsquire

KipEsquire — Fri, 28 Dec 2007 20:53:51 +0000

You can start by explaining how it’s legitimate to compare a stock value (total gold) to a flow value (annual US GDP).

That would be like saying I have “lots of beer” while ignoring the rate at which you can drink it.

Cheers!

P.S. “Creating money out of thin air does not create productive resources out of thin air, and is incapable of creating wealth.”

Yet gold-as-currency is also “creating money out of thin air.” Can I put gold coins in my gas tank and drive my car?

A gold coin is only as valuable as someone else’s willingness to accept it in exchange. There is exactly zero “intrinsic value” in gold, or paper, or fig newtons or any other potential medium of exchange.

Gold is not valuable because it’s gold; gold is valuable only because someone else considers it valuable.