CreateDebate



Welcome to CreateDebate!

CreateDebate is a social tool that democratizes the decision-making process through online debate. Join Now!
  • Find a debate you care about.
  • Read arguments and vote the best up and the worst down.
  • Earn points and become a thought leader!

To learn more, check out the FAQ or Tour.



Be Yourself

Your profile reflects your reputation, it will build itself as you create new debates, write arguments and form new relationships.

Make it even more personal by adding your own picture and updating your basics.


FB
Facebook addict? Check out our page and become a fan because you love us!


pic
Report This User
Permanent Delete

Allies
View All
None

Enemies
View All
None

Hostiles
View All
None

RSS Durentu

Reward Points:34
Efficiency: Efficiency is a measure of the effectiveness of your arguments. It is the number of up votes divided by the total number of votes you have (percentage of votes that are positive).

Choose your words carefully so your efficiency score will remain high.
91%
Arguments:37
Debates:0
meter
Efficiency Monitor
Online:


Joined:
10 most recent arguments.
2 points

ok. I'll explain it in computer engineering language. ..

I'm assuming that you know C/C++ and know about pointers. And forget for a moment that the problem scope is completely inappropriate. (programming is linear, economics is complex/network and adaptive)

Money is a pointer, it represents all sorts of things. But it must be completely strict and sound. If pointers shifted locations on their own, or changed without notifying anything, it's a big pile of mess. Variables and data structures. And if you did embedded C programming, you'd know that we can use pointers to jump the program counter and cause all sorts of runtime hazards and the resources are REALLY* tight.

But, while pointers can represent anything, even as a basket to transport things, we are not at liberty to make an infinite amount of pointers because of the limitations of the system. Of course, being engineers and using non sentient systems, we can exploit and abuse these things to our heart's content.

But pointers have very strict rules. Pointers are not permitted to be mutable, and there are structural hazards in using pointers to point to pointers to point to pointers ad infinitum.

As with currency, it is essentially debt that symbolizes debt, that symbolizes debt all the way until it hits gold somewhere. But in the modern world, this gold stopgap is removed completely. Therefore, the chain of symbols will go on forever all falling to their intrinsic value.

At the same time, pointers cannot be mutable meaning, it's is not ok to have one pointer pointer to one thing, and then have 2 pointers or multiple pointers point to the same thing (many to one) nor can we have a many to many situation, even with the very best accounting. Even in NUMA architectures, memory must be assigned strictly to their instructions, otherwise we have a huge mess.

The difference between the dollar and gold is that gold has intrinsically within it, these specific limitations that avoids these structural hazards. To substitute it for something else would introduce a whole other set of structural hazards which may or may not be conducive to a sound economic system.

The problems of economic is more like trying to isolate harmonics in a circuit network, rather than doing a top down design approach. The complex adaptive system model applies to economics in the manner in which each agent (humans) learns in their own microcosm which moves the entire economics.

If this didn't do any good, we're going to need a blackboard, a pint and lots of time.

1 point

"Industry will seek out less expensive metals to use in their products, lowering demand, etc."

This is not a monetary issue, this is a capital or consumer goods issue in the topic of production. And it's talking about the industrial uses for gold, not the monetary uses.

Can we agree that this doesn't apply to this debate?

1 point

"And that is true in the short run, however over the long run you will see institutions which coin money changing their standards, more gold mined, other metals substituting for gold and so on."

I'd like to request the source of your information for this statement. Because in my reading of economic history of the past 5000 years, it's been governments who seek out less expensive metals over time, not the minting companies, not the industry. Only governments can force people to accept this metal swapping for same value. Only governments can force people to accept this fraud; the classic bait and switch.

Gersham's law - "Bad money drives out good money if the exchange rate is set by law".

You see, it's nearly impossible to make people accept something as something else. You can't force people to accept a knockoff if there are other competitors who offer the real deal. To block out competitors is by definition a monopoly, which is IMPOSSIBLE in a free market. Even predatory pricing and such will injure, cripple or maim a company attempting it. Only government can create monopolies (joining of economics and state), and by definition, government IS a monopoly and MUST be a monopoly. You can't have two conflicting constitutions in the same community (prelude to anarchy).

1 point

"I also don't see how it would stop factional reserve banking"

The gold standard, by definition, would nullify fractional reserve because; what precisely is the reserve? What is it that the banks are putting on reservation? They are reserving gold/silver and the federal notes we call cash, are IOUs for that gold. Since 1971, Nixon completely separated all convertibility between gold and the dollar and the value of the dollar falls to it's intrinsic value; currently less than 4 cents. Adding the electronic dollar, the dollar can devalue to 0.17 cents, to 0.011 cents; read, each dollar is mere fractions of a penny.

Put it another way, the gold standard is a special case of frational reserve whereby the reserve requirement is 100%, not 10% [US].

1 point

"I think that [the gold standard] won't allow for the type of growth and large economy we have now"

It is a fallacy to think that the globe must have a billion to pay back a billion because it neglects the temporal component of capital and interest. Focusing solely on the financial and accounting, it is entirely possible to pay back a billion with the ENTIRE monetary supply limited to a million. Each payment is a million, until the full billion is repayed. This would be a 1000 term repayment.

The economic analysis of this must include the time component of interest and depreciation. And money is only a symbol. Inflation and all this funny money corrupts the symbol and introduces the "slippery slope" fallacy into the markets; purchasing power.

It is precisely the stability of the money which encourages economic growth. If you think we have growth now, growth with a stable currency would be absolutely mind boggling. With the blessing of the stable currency/money, one can plan extremely long range; ie 99 year leases.

"Money is a good servant, but a bad master". If people want large economic growth, then they would find the money to match it.

I also dispute your claim that we've had growth - but that's another debate.

1 point

What is economic darwinism? so that we can agree on semantics.

1 point

Assuming that coins, regardless of content, becomes fiat.

What prevents the car price going from 1 coin to 1 trillion coins? (assuming that financing is not available)

What happens if in a village, you triple the money supply? The prices of things will rise 3x accordingly through the market as people figure it out through subsequent trades. This is inflation and is a monetary issue.

Part of the argument FOR the gold standard is that this currency expansion is NATURALLY LIMITED. It is simply impossible to whim gold into existence as we do with pushing the zero button on the computer. Gold is a much better limiter than electronic bytes.

This monetary stability is crucial for the longevity of a country's prosperity. When people work, they produce a certain amount of product or services and they trade that for some money or currency. This currency must be a store of value over long periods of time; purchasing power.

If there is 10% annual inflation (currency expansion), that means, I have to work 10% more to buy the same stuff. This means, that instead of a 40 hr work week, I must work 44 hours next year, less I get a 10% raise (which will not happen). This distortion will trickle through the markets until all 10% (or whatever is left) is used up.

Looking at inflation and hyperinflations in yugoslavia, hungary, zimbabwe, weimar, argentina (which is an interesting case) all did this "remarking" or "replacement" of their currencies and still failed to stop the hyperinflation precisely because they kept adding to the money supply more than the demand for cash. So much so that when you sit down for dinner, your bill would change and at 2 different rates. First the base meal price change, and then the tip charge, calculating when the waitress can get to the bank the next morning.

I'm not saying that the gold standard is the only solution, but it is by far the best solution we have on the table. In the study of money, humans have used just about everything, and it failed the test. Once there is currency stability, there is price stability, and people's purchasing power is preserved. I do not believe that sheer human will in fiat currency can limit the monetary supply. Therefore, we need something that is naturally limited; scarce. This is why in microcosm economies, it's always luxury items that are used for indirect exchange.

1 point

The error is confusing monetary inflation vs supply and demand.

I think you are trying to state currency devaluation. If I read it correctly, you're saying it's more temping to DEVALUE the currency and therefore INCREASE the money supply therefore the value of the money will decrease.

Currency devaluation still follows to the law of supply and demand. You are confusing the value of gold vs the value of coins. If there are only 100 ounces of gold, you can make 100 coins, or 100,000 coins. Each with either 1oz, of gold or 1/1000th ounces of gold respectively. But it is still 100 ounces of gold in the total money supply.

What you may not see is how inflation works, which is purely a MONETARY PHENOMENA. Say a a car costs 1 oz of gold. But over time, the government remints the gold content from 1 oz gold coin down to 1/1000thoz coin. This means that in the beginning the car costs 1 coin (1 oz gold). Later on, the price will be 1000 coins (STILL 1 OZ GOLD !!). Even if the price of the car goes from 1 coin to 1000 coin, this is inflation, however, if the coin has gold content, the effects of inflation are limited.

Now, say there are different countries that want this coin of ours, whether it is in the 1oz version or 1/1000th oz version, will INCREASE demand and therefore INCREASE the value of the currency - regardless of the gold content. This is the law of supply and demand.

2 points

I don't know who is claiming this, but hey haven't really thought it through...

Evolution is a process, not a final state. If you really think about it, EVOLVED = EXTINCT.

mankind isn't extinct, therefore not evolved. Mankind is EVOLVING; continuous process.

1 point

that is contrary to the law of supply and demand. If the demand of gold increases, if more and more people value gold, its value will INCREASE.

Supply is limited by real human labor involved in digging up and refining the metals.

Durentu has not yet created any debates.

About Me


I am probably a good person but I haven't taken the time to fill out my profile, so you'll never know!


Want an easy way to create new debates about cool web pages? Click Here