06-10-2004 23:33									#31
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quote: Originally posted by Asher No need to be bitter now...

Talking to yourself again?

I am happy, happy, happy , despite being sick with a bad cold .

-Drachasor

	06-10-2004 23:36									#32
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cold medicine roks

	06-10-2004 23:40									#33
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quote: Originally posted by Japher cold medicine roks

I am happy for other reasons, and I think the dayquill I took this morning has worn off.

-Drachasor

	07-10-2004 00:31									#34
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quote: Originally posted by Shogun Gunner Money is a "store of value" by definition. Perception and evaluation of the "store of value" by economic agents in a free market economy does produce changes in the value which are not connected to labor. It's a free market after all. I'm guessing DanS has made this point before...

Perception and evaluation create changes in value? Are you kidding me? This is worse than that ACTUAL theory that money creates value. And I'm accused of trolling? You're confusing results with causes. As I said, it's all just smoke and mirrors.

	07-10-2004 00:36									#35
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quote: Originally posted by Kidicious Perception and evaluation create changes in value? Are you kidding me? This is worse than that ACTUAL theory that money creates value. And I'm accused of trolling? You're confusing results with causes. As I said, it's all just smoke and mirrors.

Yes, consumers evaluate goods and services and pay according to their perception of the value. Its the basis of a free market system. Over time, due to events, the value can change in the eyes of an individual. Economics 101

0/10 (would have been a 1/10 if you had included an amusing and/or interesting example of "smoke and mirrors"

	07-10-2004 00:37									#36
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With money; the ends justify the means. How do you think stocks get the valuation they do? Also, bond rates are not based on current values but predicted futures, which can be wrong. The dollar is not based on work, but what one perceives to be the value of American work.

	07-10-2004 00:37									#37
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That doesn't create value. It only 'evaluates' it.

	07-10-2004 00:40									#38
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evaluate: to asses; appraise; estimate.

How do you get create out of that? Magic?

	07-10-2004 00:48									#39
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quote: Originally posted by Kidicious evaluate: to asses; appraise; estimate. How do you get create out of that? Magic?

In theory, economic agents work with perfect information. In reality, the information is far from perfect. Individuals and/or companies will evaluate with whatever information is available.

I think you already now all this, but I'll waste the time to type it anyway.

Step 1: Grain is one dollar a pound. [Market price decided by what people are willing to pay for one pound of grain]
Step 2: Poor weather ruins thousands of acres of crops. Grain is more scarce. [event]
Step 3: Investors that learn of this information make decisions that change their holdings to match the anticipated consumer's behavior change [Evaluation]
Step 4: More competition for a scarce good bids the price up -- to whatever the market bears.

Is that magic? I wonder how you make your everyday decisions if this doesn't jive with your worldview.

	07-10-2004 00:52									#40
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The Supply/Demand economic system is a form of rationing (supply goes down, price goes up). This is fine now, but in the future, when improvements in technology causes things too be made more cheaply and causes unemployment as things become more automanted things will come to a head.

	07-10-2004 01:17									#41
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quote: Originally posted by Shogun Gunner Is that magic? I wonder how you make your everyday decisions if this doesn't jive with your worldview.

I know all that. It's very simple explaination of capitalism. Not magic. It's not even what this thread is about.

Now you should tell me how money creates value.

	07-10-2004 01:19									#42
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quote: Originally posted by Dauphin I'm with Flubber, how about Kid giving me an interest free loan then?

I create value by charging you interest.



You guys better not quit your day job. Better let Adam Smith come in here perform this trick.

	07-10-2004 01:23									#43
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quote: Originally posted by Kidicious I know all that. It's very simple explaination of capitalism. Not magic. It's not even what this thread is about. Now you should tell me how money creates value.

Money doesn't create value; people increase or decrease the value of money, assets, and services based on their needs, desires, supply/demand, and several other factors.

The concept of "Time Value of Money" doesn't even suggest that "money creates value". Inflation, for example, changes the value of money over time. Its a reality dude, I mean kid.

	07-10-2004 01:27									#44
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quote: Originally posted by Shogun Gunner Money doesn't create value

I think I have actually changed someone's mind.

	07-10-2004 01:32									#45
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Lets get more basic.

Money (as in cash) is a unit of exchange that allows easier exchanges of things of different value. I might barter 2 chickens for an hour of your labor. But instead I give you $20 which you use to get 1 chicken and then the other $10 for other things.

Even in a kidicious society where everyone was paid the same wage, there should be a use of money as a unit of exchange. (assuming people are permitted to freely buy things and are not merely assigned commodities)


Now time value of money. . .. you work for me today and expect $100 today. Instead I tell you I will give you the $100 next week or next year or next decade. Even assuming zero inflation, there is value to having use of that money NOW as opposed to later.

In current economies this value can be reflected in the difference in the charged rate of interest on loans and the inflation rate( the real interest rate).

even if you eliminated money, I would surmise that there is a time value of work. Labor now would be worth more than an equivalent amount of labor at a distant future time


But you know all this stuff kid, you just choose to ignore it.

	07-10-2004 01:34									#46
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It's a semantic argument.

	07-10-2004 01:35									#47
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huh?

	07-10-2004 01:36									#48
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It's a troll....as stated very early in the thread.

	07-10-2004 01:36									#49
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quote: Originally posted by Shogun Gunner It's a semantic argument.

It's not at all. It's all very simple. Does money create money? Does borrowing money or buying stock create anything. Of course not.

	07-10-2004 01:37									#50
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quote: Originally posted by Shogun Gunner It's a troll....as stated very early in the thread.

I was refering to a post that I did not read. Not yours.

	07-10-2004 01:44									#51
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quote: Originally posted by Kidicious I was refering to a post that I did not read. Not yours.

How exactly do you refer to something you do not read?

	07-10-2004 01:48									#52
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quote: Originally posted by Kidicious It's not at all. It's all very simple. Does money create money? Does borrowing money or buying stock create anything. Of course not.

In Economics the perception is as strong, or even stronger, than the reality. Its speculation. If you are asking if "money creates money", well of course not.

However, I think you are oversimplying this topic. The action of one economic agent has an effect on the marketplace. In this case, investment made by one agent, allows another agent to obtain the captial (at a price) and create economic activity (start a business, whatever). After some time, the first economic agent get his captial back and a profit. From his perspective, if he were a real simpleton, he would declare, "By golly, my money just made me more money!"

This fluidity of capital allows economic activity to occur where it otherwise would not.

Now, there is a debate between the "zero sum game crowd" and "perpetual growth crew" but that's for another thread....

	07-10-2004 01:55									#53
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quote: Originally posted by Shogun Gunner In Economics the perception is as strong, or even stronger, than the reality. Its speculation. If you are asking if "money creates money", well of course not. However, I think you are oversimplying this topic. The action of one economic agent has an effect on the marketplace. In this case, investment made by one agent, allows another agent to obtain the captial (at a price) and create economic activity (start a business, whatever). After some time, the first economic agent get his captial back and a profit. From his perspective, if he were a real simpleton, he would declare, "By golly, my money just made me more money!" This fluidity of capital allows economic activity to occur where it otherwise would not. Now, there is a debate between the "zero sum game crowd" and "perpetual growth crew" but that's for another thread....

But it's not just the money holder's perspective. It's the perspective of a society that justifies capitalism.

If work creates all value, as we have agreed, and money is compensated (for whatever, if anything, that it does), then you have to have a justification for that. The concept of the time value of money serves as that justification, and as I have said, it's nothing but smoke and mirrors.

edit: because it completely ignores the fact that the only value created was created by those who produced the goods and services consumed or those who will produce those goods and services in the future.

	07-10-2004 02:05									#54
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I have not agreed that labor is the only input to price (or value). Labor is a signficiant, large input to value/cost. However, I have maintained that speculation and lending assets/capital for a fee also contribute to value/cost.

I think the real question is what I semi-seriously posed before which is whether the economic system is a zero-sum game (for every winner there is a loser) or if there is growth (the economic pie grows over time).

I don't see how you can get around the points that Flubber, myself and others have made in this thread. Since I don't know you very well, I'm assuming this is a bit of "tongue in cheek".

I'm not against communists, but really, how many threads have there been just at Poly about the failures in communism. You might not like capitalism, but it's an established economic system that works. Your tenet that "money doesn't make money" flies in the face of most economic theory. Who knows, maybe everyone else is wrong and you are right -- you could be the next John Maynard Keynes!

	07-10-2004 02:07									#55
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quote: I think the real question is what I semi-seriously posed before which is whether the economic system is a zero-sum game (for every winner there is a loser) or if there is growth (the economic pie grows over time).

Good question...

	07-10-2004 02:10									#56
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quote: Originally posted by Shogun Gunner I don't see how you can get around the points that Flubber, myself and others have made in this thread.

He doesn't try to get around my posts . .. he simply ignores inconvenient realities. I've lost count of the number of directly on point posts that he fails to address.

Once you get to know kid you will understand. he posts variations on the same theme (capital is valueless. rent is an unfair tax or interest should be illegal) from time to time. I still find it fun to chime in from time to time

	07-10-2004 02:16									#57
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quote: Originally posted by Shogun Gunner I have not agreed that labor is the only input to price (or value). Labor is a signficiant, large input to value/cost. However, I have maintained that speculation and lending assets/capital for a fee also contribute to value/cost.

Flip-flopper. I specifically asked you if charging you an interest rate created value, and you said "of course not"

quote: I think the real question is what I semi-seriously posed before which is whether the economic system is a zero-sum game (for every winner there is a loser) or if there is growth (the economic pie grows over time).

I'm not arguing that it's a zero sum game. Just the opposite of course. The sum is greater than the parts. Everyone knows that I believe this.

quote: I don't see how you can get around the points that Flubber, myself and others have made in this thread. Since I don't know you very well, I'm assuming this is a bit of "tongue in cheek".

I ignore Flubber. Isn't that obvious? He's quite annoying.

quote: I'm not against communists, but really, how many threads have there been just at Poly about the failures in communism. You might not like capitalism, but it's an established economic system that works. Your tenet that "money doesn't make money" flies in the face of most economic theory. Who knows, maybe everyone else is wrong and you are right -- you could be the next John Maynard Keynes!

You're flip-flopping again.

This isn't really about communism. In fact the first person to call the concept of the time value of money magic was Keynes, and he was no communist.

	07-10-2004 02:17									#58
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I was once was able to get 4 candy bars for a dollar... now I am luck if I can get 2. Why?

Did they start putting more or different stuff in the candy bar? Did the manfuacturer or other person down the chain of command just get more greedy? Is the wrapper made of pure gold? Was there some strange candy tax levied on the bar?

Actually, the dollar's purchasing power just became less. I could no more buy the same amount of soda for a dollar than I could candy bars.

In that sense it is a zero sum game? That, however, is the time value of money.

	07-10-2004 02:19									#59
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Well, in that case I think the FICA tax isn't really a viable economic concept and I'm going to demand that payroll stops the criminal process of removing these funds from my bi-weekly compensation distribution.

Prove to me that FICA tax is a valid economic activity. Oh, you can't, can you. That's all the proof I need....here I go walking down to payroll......

	07-10-2004 02:20									#60
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quote: Originally posted by Japher I was once was able to get 4 candy bars for a dollar... now I am luck if I can get 2. Why? Did they start putting more or different stuff in the candy bar? Did the manfuacturer or other person down the chain of command just get more greedy? Is the wrapper made of pure gold? Was there some strange candy tax levied on the bar? Actually, the dollar's purchasing power just became less. I could no more buy the same amount of soda for a dollar than I could candy bars. In that sense it is a zero sum game? That, however, is the time value of money.

That's right on.