Am against fiat money

[1RebelSoul]

I am against the concept of fiat money.
I think it is the root of all evil.
A natural resource should be the medium of exchange.

[Ethics Gradient, Traitor For All Ages]

Reptilian eggs

[Vladimir Innit Lenin]

Why is this a learning thread?

Fiat money is not a huge player in capitalism anymore, China vs US trade wars aside. Credit money is the real driver of all things capital these days.

[Sam_b]

Reptilian eggs

Perhaps you should read this a bit closer (http://www.revleft.com/vb/stricter-rules-learning-t182305/index.html?p=2645476#post2645476) and have an infraction for your trouble.


Why is this a learning thread?

Because the poster is new and wants to generate a discussion about it and give us his views. Very welcoming of you.

[tuwix]

A natural resource should be the medium of exchange.

And and excelent brake of human end economic development...

[Popular Front of Judea]

Fiat money not capitalism? Capitalists did a bang up job in the 19th and 20th centuries exploiting the proletariat at home and the colonies while paying themselves profits in currency backed by gold. Ron Paul would be proud.


I am against the concept of fiat money.
I think it is the root of all evil.
A natural resource should be the medium of exchange.

[Vladimir Innit Lenin]

Because the poster is new and wants to generate a discussion about it and give us his views. Very welcoming of you.

It's not asking any questions, though, that's my point. Yet somehow you presume to speak for the OP and their motives.

But yes, money is an incredibly interesting question, especially the transition from fiat money to credit money and its impact upon economies today, the production process, investment and the capital/labour struggle.

Actually a lot of post-Keynesian economists have written a great deal on the subject, it seems to be one of their 'in' things to write about.

[Noa Rodman]

Leon Trotsky, If America Should Go Communist


Your almighty dollar will play a principal part in making your new soviet system work. It is a great mistake to try to mix a “planned economy” with a “managed currency.” Your money must act as regulator with which to measure the success or failure of your planning.
Your “radical” professors are dead wrong in their devotion to “managed money.” It is an academic idea that could easily wreck your entire system of distribution and production. That is the great lesson to be derived from the Soviet Union, where bitter necessity has been converted into official virtue in the monetary realm.
There the lack of a stable gold ruble is one of the main causes of our many economic troubles and catastrophes. It is impossible to regulate wages, prices and quality of goods without a firm monetary system. An unstable ruble in a Soviet system is like having variable molds in a conveyor-belt factory. It won’t work.
http://www.marxists.org/archive/trotsky/1934/08/ame.htm


Trotsky though had an average understanding of a gold standard (eg he falsely believed that there must be 100% gold "backing" of a currency).

I recommend this new book:

Gold: the Monetary Polaris (http://www.amazon.com/Gold-Monetary-Polaris-Nathan-Lewis/dp/149041195X)(by Nathan K Lewis) (http://www.amazon.com/Gold-Monetary-Polaris-Nathan-Lewis/dp/149041195X)

[Popular Front of Judea]

Fascinating to see the inroads Austrian crankery has made in the thoughts of American Marxists. There is little in common between post revolutionary Russia and contemporary America.


Leon Trotsky, If America Should Go Communist

http://www.marxists.org/archive/trotsky/1934/08/ame.htm


Trotsky though had an average understanding of a gold standard (eg he falsely believed that there must be 100% gold "backing" of a currency).

I recommend this new book:

Gold: the Monetary Polaris (http://www.amazon.com/Gold-Monetary-Polaris-Nathan-Lewis/dp/149041195X)(by Nathan K Lewis) (http://www.amazon.com/Gold-Monetary-Polaris-Nathan-Lewis/dp/149041195X)

[Vladimir Innit Lenin]

Ah, Trotsky the non-economist turning into Trotsky the Capitalist!

The gold standard is a ridiculously flawed idea. It would be reactionary to propose that today, to effectively hark back to lower living standards and stable prices. As I said before, the main currency in circulation today is credit money, not fiat money. Credit money has allowed huge advances in living standards, whilst bringing to the fore evermore problems to the smooth flow of investment, production and distribution in the capitalist system.

[RedBen]

original poster, do you think there is a legitimate place in society for a monetary system? could you elaborate on what you mean by a monetary means of exchange, what should be the medium and what value it should have? please explain your opinions more.

[Noa Rodman]

the main currency in circulation today is credit moneyA gold standard allows far more credit (eg Britain issued eternal bonds). Credit transactions at the time already were the main 'currency in circulation':

In the U. States in 1871 payments with cash banknotes and metal coins made up only 12%, while 88% with checks and promissory notes. In 1881, all sorts of moneyless transactions settled already 92% of all payments, and then later, this percentage has still increased...

http://libcom.org/library/nominalism-problem-value-money-g-dashevsky

At the time of the bimetallism debate (late 1890s) all marxists defended a gold standard system. In the 1930s you see not only Trotsky, but also social-democrats like Hilferding and the Stalinists denounce the suspension of the gold standard as an attack on the working class (this has nothing to do with Austrian crankery, but is known to classical political economists, whom btw, Marx defended against Proudhon and Lassalle).

[RedBen]

A gold standard allows far more credit (eg Britain issued eternal bonds). Credit transactions at the time already were the main 'currency in circulation':

In the U. States in 1871 payments with cash banknotes and metal coins made up only 12%, while 88% with checks and promissory notes. In 1881, all sorts of moneyless transactions settled already 92% of all payments, and then later, this percentage has still increased...

http://libcom.org/library/nominalism-problem-value-money-g-dashevsky

At the time of the bimetallism debate (late 1890s) all marxists defended a gold standard system. In the 1930s you see not only Trotsky, but also social-democrats like Hilferding and the Stalinists denounce the suspension of the gold standard as an attack on the working class (this has nothing to do with Austrian crankery, but is known to classical political economists, whom btw, Marx defended against Proudhon and Lassalle).
gold ain't worth a fuck

[Decolonize The Left]

gold ain't worth a fuck

These are the sorts of posts that earn you infractions. Why not try contributing to the discussion?

[RedBen]

These are the sorts of posts that earn you infractions. Why not try contributing to the discussion?
oh excuse me, ahem "what value does gold carry in your opinion? how does your perceived value of said form of metal transcend lines between particular peoples? how does a slip of paper honestly represent a chunk of said metal? what is the relation of metal to it's paper representation? what is the means of enforcing these relationships?" is that better?

[adipocere]

I am against the concept of fiat money.
I think it is the root of all evil.
A natural resource should be the medium of exchange.

Sitting on hordes of golden coins like dragons is no longer practical (although Apple seems to be doing just that off shore, - like a lonely, bitter, useless old dragon) - strip mining natural resources all over the world is more difficult to physically control.

I just really don't understand this mentality. Why not pull money out of thin air? It's all a great capitalist construct for the purpose of exploitation, instability and control. What difference does it make if it's gold, dollar bills, Cheetos or made up numbers in an Bank of America computer terminal? As long as the end result is that you don't have any and that you are willing to leverage your life to borrow it with interest.

You can sit around and read self-help, get rich quick books about fiat currency written by gold investors, listen to unhinged libertarians make vaguely racist predictions of doom...but money and markets are backed by confidence...increasingly they are backed by analytical software on computers that scan news headlines for catastrophes. That "confidence" is backed by the stability of the Gubment, Really, people should have this worked out in grade school.

[RedBen]

Sitting on hordes of golden coins like dragons is no longer practical (although Apple seems to be doing just that off shore, - like a lonely, bitter, useless old dragon) - strip mining natural resources all over the world is more difficult to physically control.

I just really don't understand this mentality. Why not pull money out of thin air? It's all a great capitalist construct for the purpose of exploitation, instability and control. What difference does it make if it's gold, dollar bills, Cheetos or made up numbers in an Bank of America computer terminal? As long as the end result is that you don't have any and that you are willing to leverage your life to borrow it with interest.

You can sit around and read self-help, get rich quick books about fiat currency written by gold investors, listen to unhinged libertarians make vaguely racist predictions of doom...but money and markets are backed by confidence...increasingly they are backed by analytical software on computers that scan news headlines for catastrophes. That "confidence" is backed by the stability of the Gubment, Really, people should have this worked out in grade school.
i'm mad i can't pos rep you twice. money is a detriment in all it's forms in my opinion

[Popular Front of Judea]

"all marxists"? Care to provide quotes, links and possibly some context? I believe Trotsky advocated the gold standard because of the difficulties that a floating exchange rate presented to the rudimentary planning of the Soviet Union of his time.


At the time of the bimetallism debate (late 1890s) all marxists defended a gold standard system. In the 1930s you see not only Trotsky, but also social-democrats like Hilferding and the Stalinists denounce the suspension of the gold standard as an attack on the working class

[Noa Rodman]

Well defended it is a bit of a loaded term, but yes they preferred a gold standard to bimetallism.

Engels to Sorge, March 18, 1893


The silver business in America does not seem to be able to settle down otherwise than through a crash. Nor does Cleveland seem to have the power and courage to break the necks of this bribery ring. And it would be really good if things came to a head.
A nation — a young nation — so conceited about its “practice” and so frightfully dense theoretically as the Americans are, gets thoroughly rid of so deep-rooted a fixed idea only through its own sufferings. The plausible idea of imagining that there isn’t enough money in the world because one hasn’t any when one needs it — this childish idea common to the paper currency swindle à la Kellogg and to the silver swindle is most surely cured by experiment and bankruptcy, which may also take a course that is very favorable for us. If only some sort of tariff reform is effected this fall, you may be quite satisfied. The rest will follow; the main thing is that American industry is enabled to compete in the world market.
http://www.marxists.org/archive/marx/works/1893/letters/93_03_18.htm

Also Kautsky's review of Max Schippel (Die Währungsfrage und die Sozialdemokratie. Eine gemeinfaßliche Darstellung der währungspolitischen Zustände und Kämpfe):

The brochure responds to proponents (such as Otto Arendt) of bimetallism, which found adherents among farmers (to wit, simple commodity producers) especially in America, but even among proletarians with the highest class consciousness. Their illusion was that devaluation of money (in the form of silver paper money) was a way out of the crisis. The gold standard is in fact a progressive step according to Schippel (if a side should be taken in this at all). He explains how with devaluation (of currency) the prices of products rise faster than the wages, there is an increase of exploitation, but this goes unnoticed by workers (initially); and if they win a raise, this is only nominal; a gold standard at least reflects the situation more honestly. It's not so much their class interests (because bimetallism only serves to increase uncertainty and crises) as lack of understanding of the nature of money by a part of the capitalists. But also by workers in America, who haven't escaped the influence yet of the ideas of farmers. They develop a "currency-socialism" (WährungsSozialismus). On the one hand they consider money as a mere worthless sign, on the other they equate money with capital and regard capital-interest as the price of money. The more money, the more competition, the less the interest-rate, the less exploitation, the easier for non-capitalists to acquire means of production. The overflow with worthless money-signs is thus the best way to break the capitalist monopoly of means of production and end exploitation.
This illusion caused Anglo-American workers during the 1860s and 70s to have great enthusiasm for a paper money economy. This illusion in the miracles of bad money finds a new life with the devaluation of silver.

(Again, I recommend to check out Nathan Lewis, eg his short Gold Standard Fallacies (http://www.newworldeconomics.com/archives/2007/081907.html))

[Noa Rodman]

how does a slip of paper honestly represent a chunk of said metal? what is the relation of metal to it's paper representation? what is the means of enforcing these relationships?" is that better?If instead of a precious metal, you focus this question on all commodities, we arrive at the heart of Marx, don't we? How does money represent the value of commodities? Can paper signs directly express the value of commodities?

[RedBen]

why is gold valuable? cause it doesn't rust as quickly as other metals? cause it is a decent electrical conductor? cause it is rare? does that give it real worth to most people who cannot form metal, nor can they design electrical grids, nor would they mine. if you think gold is worth something, trying eating it, wearing it as clothing to shelter your body against the elements or building a home with it. gold is as asinine as diamonds. so to my post, "gold ain't worth a *legitimate* fuck" i wasn't wrong

[RedBen]

If instead of a precious metal, you focus this question on all commodities, we arrive at the heart of Marx, don't we? How does money represent the value of commodities? Can paper signs directly express the value of commodities?
no, a false promissory note doesn't amount to shit. paper money amounts to nothing, and access to resources(commodities) without being equipped to utilize them is also worthless. if i can promise you some crude oil, can you process it and derive plastic, as well as gasoline? my guess would be no. access to resources for those who are ignorant is pointless. money is also asinine. what constitutes value, then value according to the dollar, then dollar to the euro? what equals what? there is no clear defined formula that amounts to anything.

[1RebelSoul]

original poster, do you think there is a legitimate place in society for a monetary system? could you elaborate on what you mean by a monetary means of exchange, what should be the medium and what value it should have? please explain your opinions more.


No, you are right. The present monetary system is nothing but covert fascism.
Thanks for your interest in my post. :)
This is a very broad topic. There are many thoughts, many ideas and many a way to implement them.I will discuss them in later posts.

[Vilhelmo]

I am against the concept of fiat money.
I think it is the root of all evil.
A natural resource should be the medium of exchange.

Fiat money is the only money.
Medium of exchange is one function of money not its definition.