Re: Moneyness by FOFOA
Posted: 17 Nov 2012, 05:15
http://fofoa.blogspot.com/2012/11/money ... mment-form
Moneyness 2: Money is Credit
FOFOA starts with an interesting 'abstract' that attempts to summarize this essay:
"Money is credit." ...More specifically, it is the recording of current balances of credit. It can be recorded in your head, represented on an institutional ledger, or carried in your pocket as pieces of paper or metal with numbers recorded on them. But notice that it's the recorded numbers and not the paper/metal in your pocket that constitutes the money."
I like this a great deal.
FOFOA immediately moves on to wealth. but his comments are less satisfying: "But you can't possibly understand the pure money concept without also understanding the wealth concept. The pure concept of wealth is really simple. It's only attribute is possession.."
From here FOFOA feels compelled to discuss 'value', and gold's value: 'tradeable wealth' because everyone in the world places the same value on it.
What he doesn't mention here, but uses extensively throughout the rest of the essay is the notion that value is defined and shared by a cohesive social group. The notion of 'tribe' is foundational: "Since the beginning of time, man has been exploring and discovering the advantages of tribal life." If 'money is credit', credit only makes sense in the context of 'tribal credibility' or 'civic credibility' or 'national credibility'.
Banks don't lend 'things', says FOFOA. "...Get over this idea that banks need to have something to lend. This is the faulty premise: that banks lend something to the borrower. They do not. The borrower already has the credibility, the credit, and the banks are simply facilitating the exercise of that credit so that it can be used in transactions,..."
This allows FOFOA to make what might be a very controversial claim. I'll paraphrase FOFOA: old standards produce wars. FOFOA quotes FOA to make this point: "...tribal life and the human nature that comes with it ,,,,,,,, will not allow any money system to "completely" destroy the wealth of a good portion of society. Even if everyone is plainly shown that they are going to lose something ,,,,,,they would still opt for the good of the overall tribe. This is why we return,,,, time and again to fiat monetary systems. In the few examples where a gold system brings the harsh reality of loses to bear on a nation,,,,,, usually war is the result. Not a good outcome."
Malcolm
Moneyness 2: Money is Credit
FOFOA starts with an interesting 'abstract' that attempts to summarize this essay:
"Money is credit." ...More specifically, it is the recording of current balances of credit. It can be recorded in your head, represented on an institutional ledger, or carried in your pocket as pieces of paper or metal with numbers recorded on them. But notice that it's the recorded numbers and not the paper/metal in your pocket that constitutes the money."
I like this a great deal.
FOFOA immediately moves on to wealth. but his comments are less satisfying: "But you can't possibly understand the pure money concept without also understanding the wealth concept. The pure concept of wealth is really simple. It's only attribute is possession.."
From here FOFOA feels compelled to discuss 'value', and gold's value: 'tradeable wealth' because everyone in the world places the same value on it.
What he doesn't mention here, but uses extensively throughout the rest of the essay is the notion that value is defined and shared by a cohesive social group. The notion of 'tribe' is foundational: "Since the beginning of time, man has been exploring and discovering the advantages of tribal life." If 'money is credit', credit only makes sense in the context of 'tribal credibility' or 'civic credibility' or 'national credibility'.
Banks don't lend 'things', says FOFOA. "...Get over this idea that banks need to have something to lend. This is the faulty premise: that banks lend something to the borrower. They do not. The borrower already has the credibility, the credit, and the banks are simply facilitating the exercise of that credit so that it can be used in transactions,..."
This allows FOFOA to make what might be a very controversial claim. I'll paraphrase FOFOA: old standards produce wars. FOFOA quotes FOA to make this point: "...tribal life and the human nature that comes with it ,,,,,,,, will not allow any money system to "completely" destroy the wealth of a good portion of society. Even if everyone is plainly shown that they are going to lose something ,,,,,,they would still opt for the good of the overall tribe. This is why we return,,,, time and again to fiat monetary systems. In the few examples where a gold system brings the harsh reality of loses to bear on a nation,,,,,, usually war is the result. Not a good outcome."
Malcolm