KitemanSA wrote:I suppose it COULD, but the last thing I would want is to have the medium for value storage be subject to the inventiveness of people. It's like making diamonds your medium. Along comes Gemtech and your life savings is basically worthless. No thanks. My vote is no for the implied question.
I had hoped you would have spent more time formulating an objection.
"I am sorry for the long letter, I didn't have time to make it short". You confuse brevity with lack of thought. That is a fool's response.
I have much experience with knee jerk reaction type responses. That is exactly what yours appeared to be.
As an example of what I mean, I have in the past, attended City Council meetings. They can be presented with an issue, and in a few minutes take a vote on it. I have always said they must be the most incredibly intelligent people, because they can weigh information and reach a decision in just a few minutes, where it would take an ordinary man the better part of an hour to reason through it.
As for your criticism of the idea, you haven't really explained how letting the Government, or the Government's agent (Federal Reserve) screw around with the currency is much better than basing it on a clearly defined scientific standard.
Like I said up thread, a $20.00 gold piece is now worth around $1,700.00 .
A nearly 100-1 deflation in value is a good thing?
‘What all the wise men promised has not happened, and what all the damned fools said would happen has come to pass.’
— Lord Melbourne —
Ok now here is something I can comment on with authority. Up until 2008 the value of a twenty dollar gold piece did not keep up with the inflationary value of the dollar. In other words your gold piece lost money by holding on to it. You could purchase more produces with it when it was first minted than it current purchusing value in 2008. It was not until this recent blip in gold prices did it again keep up and surpass its "inflationary purchase value" this was caused by speculation . The only question that remains is when/if the economy returns to normal how far will gold drop. (AKA mid eights gold boom.)
KitemanSA wrote:But it would be tied to a CONSUMABLE product the value of which can swing wildly from day to day. Why not make bread our basis for money?
As a mater of fact , labor to buy one loaf of bread is a standard in economic indicators.
KitemanSA wrote:But it would be tied to a CONSUMABLE product the value of which can swing wildly from day to day. Why not make bread our basis for money?
As a mater of fact , labor to buy one loaf of bread is a standard in economic indicators.
As a matter of fact, it shows how bad bread would be as a standard in the the labor to make it has gone WAY down. The unit of value has become effectively valueless. Not a good thing for the storage medium for value.
Energy credits and bitcoin are both sets of ones and zeros generated by a computer keyboard. Bitcoin got hacked a little while ago, and I can't see any reason energy credits could not be counterfeited. What matters is the people in charge of the quantity of currency in circulation, and whether they are a public entity or a private company. A private company will try to manipulate the quantity in order to gain monopoly control of the economy. A public entity is tempted to print too much and buy votes. Ideally, the process is transparent to all.
Gold bars have also been found with tungsten cores, even Roman gold or silver coins had copper in the cores as per the emperors secret instructions. In fact, if the various countries that keep their gold in foreign banks asked to have it returned the governments hosting those banks would say no. Rumour has it the British cleaned out Ft. Knox. Governments have confiscated both gold and paper from citizens in times of financial crisis.
What bothers me is government printing money, lending it to banks at almost zero interest and then borrowing it back at a higher rate, with the taxpayer stuck covering the difference. We have an ongoing lawsuit in Canada opposing this practise amoung other things. On Dec. 5th they had the first court date, no word yet on the second, the supreme court judge is studying the matter.
paperburn1 wrote:
A $20.00 gold piece is now worth around $1,800.
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Ok now here is something I can comment on with authority. Up until 2008 the value of a twenty dollar gold piece did not keep up with the inflationary value of the dollar. In other words your gold piece lost money by holding on to it. You could purchase more produces with it when it was first minted than it current purchusing value in 2008. It was not until this recent blip in gold prices did it again keep up and surpass its "inflationary purchase value" this was caused by speculation . The only question that remains is when/if the economy returns to normal how far will gold drop. (AKA mid eights gold boom.)
The point is not specific to gold, gold was merely an example of the point. The point was specific to the fact that the Fed and the US government's monetary policies yield the result of loss of value through manipulated inflation.
They are in effect, stealing the value of dollars saved. Many projections that I have seen indicate an exponential growth in inflation. Are you trying to tell me that this is the BEST possible outcome? That no other system could improve on this?
‘What all the wise men promised has not happened, and what all the damned fools said would happen has come to pass.’
— Lord Melbourne —
If credits can be exchanged at a defined rate for electricity delivered, or any other specific defined commodity, more credits in circulation would tend to drive more demand for the now cheaper commodity. If the issuing agency was liable for failure to deliver, they face a direct measure and consequence for over issue of credits.
Electricity, being a commodity regularly used instead of just stored, would resist the adulteration gold currency has seen. On the other hand, it depends on an on demand production and delivery. A utility in one area can't deliver outside its district without loss, such as payment for another utility to deliver energy.
hanelyp wrote:If credits can be exchanged at a defined rate for electricity delivered, or any other specific defined commodity, more credits in circulation would tend to drive more demand for the now cheaper commodity. If the issuing agency was liable for failure to deliver, they face a direct measure and consequence for over issue of credits.
Electricity, being a commodity regularly used instead of just stored, would resist the adulteration gold currency has seen. On the other hand, it depends on an on demand production and delivery. A utility in one area can't deliver outside its district without loss, such as payment for another utility to deliver energy.
exactly as well as energy rich areas vice energy poor areas.
By the way its min worked to receive a pound of bread or a pound of rice to measure wealth. The actual cost of the bread/rice in not the real determining factor but how long you must toil at a labor to receive that bread/rice. In reality not germane to this particular conversion as we are talking about an alternate base/standard to measure our wealth. Black acres so to speak.
My initial reaction is that I like the idea. Money is supposed to represent wealth, which in it's fundamental form is itself really the potential for production. What better indicator of that then a unit of energy. Being consumable is irrelevant, because, ideally, it is consumed to accomplish something else. And if I have $100k in the bank, and it represented say exactly 1GWh, then it is fairly fixed what I can do with 1GWh of energy. I know almost exactly what it is worth because I can figure out what can be done with it. Of course, to be any good as a fixed currently, we would have to store all the energy somewhere to represent the issued currency.
kcdodd wrote:My initial reaction is that I like the idea. Money is supposed to represent wealth, which in it's fundamental form is itself really the potential for production. What better indicator of that then a unit of energy. Being consumable is irrelevant, because, ideally, it is consumed to accomplish something else. And if I have $100k in the bank, and it represented say exactly 1GWh, then it is fairly fixed what I can do with 1GWh of energy. I know almost exactly what it is worth because I can figure out what can be done with it. Of course, to be any good as a fixed currently, we would have to store all the energy somewhere to represent the issued currency.
Someone mentioned up thread that some standards would have to be agreed upon such as whether or not it is Electricity delivered to the grid, or some such, but even with some version of energy delivered as the defacto standard, other forms of energy can be converted to it by calculating them at some conversion factor.
Wind Energy credit futures could be sold based on past records of performance and upkeep, Same with Nuclear, Solar and Hydro. Coal, Oil and Natural Gas can be sold (or delivered) based on the current system of bringing them to market.
The only legitimate criticism that I have seen so far is that such a system might give those with access to raw energy sources an advantage. I suppose that regardless what is proposed as a non-tamper-able currency standard someone is initially going to have an advantage.
If someone has a better idea, i'm all ears.
‘What all the wise men promised has not happened, and what all the damned fools said would happen has come to pass.’
— Lord Melbourne —
The moment something like this exists someone goes out and builds 200 nuclear reactors (or other form of energy producing system) and stores the power they create. That would instantly crash the market as the value of stored energy would plummet. Not to mention if a fusion reactor was ever created it would instantly destroy the worlds economy, the cost of energy would be so low as to be nearly worthless.
Measurements of wealth need to be intangible otherwise their easily manipulable. The current system use's the market rules of supply vs demand and new wealth is only created through investments. Otherwise wealth is just constantly changing hands and going in circles.
