Gold also doesn’t have inherent worth, nothing does (economically speaking). Gold is worthless when you’re dying of thirst in the desert, while water is worthless while drowning in a lake. What makes gold interesting as a unit of exchange and account is its limited supply, and quite stable inflation.
Stable inflation is relative, though: The Spanish managed to tank their economy back in the days with all that gold they imported from South America. But in these days, yep, it’s a steady trickle of new gold.
You can also wear it as jewellery which is a thing some people do, technical applications are limited, or, better put, require very little amounts of gold (mostly just plating for corrosion resistance, bond wires, such things). Sure you can recycle a CPU and get some gold out but you won’t get rich off it.
Fiat currencies, if administered sensibly (i.e they’re reasonably price-stable) are backed by the economical base of the region that issues them: A Euro has the use-value of an espresso because Italians have espresso machines and can work them.
The actual goal of political economy should be the well-being of the people. Price stability can be a means to that end, but it can also diminish standards of living. Certainly, price stability is not an end in itself.
To clarify what I mean, this current inflationary period is being caused by transient supply disruptions. They’ll clear up on their own. Apart from Japan, what are the central banks of the world doing? They’re trying to throw their economies into recession. Because of transient inflation that was not caused by runaway demand.
It’s tricky to talk about actual gold standard days, since economic data aren’t very reliable that far in the past, but historical accounts don’t exactly paint a rosy economic picture. Whether there was price stability, I’m really not sure, but I do know there was mass unemployment, frequent economic crises, and widespread poverty.
Finally, the Eurozone… Their recession following the global financial crisis lasted longer than other advanced economies, because the Stability and Growth Pact is the opposite of sensible economic administration. Indeed, Europe is in a downward binge-purge spiral of—crisis happens, better ignore excessive deficit rules and let the ECB buy sovereign debt at its discretion; well the crisis is over, time to fuck up European economies again; oh no there’s another crisis, better ignore the SGP again.
At some point I might have to leave the US, so it’s a shame that Europe isn’t a viable alternative.
To clarify what I mean, this current inflationary period is being caused by transient supply disruptions.
Not at all. It’s caused by companies, especially food companies, thinking they can get away with price-gouging. Ukraine doesn’t export nearly as much wheat any more, however a) that doesn’t mean that pasta should get more expensive as Ukraine grows soft, not hard, wheat and b) speaking about the EU, we’re more than self-sufficient when it comes to soft wheat and, by and large, didn’t import from Ukraine, or anyone, for that matter. Hence also why re-organising logistics to ship Ukrainian grain to the EU to then ship onwards was not at all easy to set up.
Gas also isn’t really an issue any more. What might be a valid point is costs due to companies diversifying everything, but that’s the good kind of costs.
Their recession following the global financial crisis lasted longer than other advanced economies
…because too few member states have bouncing back from crises down as well as Germany does. It’s not a secret how we’re doing it but other states don’t seem to get that with a central bank focussed on price stability, you have to have some policies in place. Things like having a Kurzarbeit regime should probably get written into the Eurozone accession criteria because certain countries still seem to be in the “we’re going to inflate ourselves out of the situation” mindset which of course won’t work if you can’t inflate.
Nothing has inherent value. Inherent value shouldn’t be confused with practical value. Anyway, while gold has some practical value nowadays, being a corrosion resistant electrical conductor doesn’t explain why people wanted gold more than a hundred years ago. Thinking there’s something special about gold that makes it valuable irrespective of social beliefs or practical uses is just… the world’s least interesting religion.
The fact is, money has value because it’s the only thing that can be used to pay taxes. So for the next level, I’ve never quite understood what “social construct” means. Is being punched for cosplaying a Nazi a social construct? Not the justification, but the fist, is the fist a social construct? Is being harassed by the IRS because you’re a sovereign citizen who uses self-issued Freedom Dollars and doesn’t believe the Sixteenth Amendment was duly ratified so income taxes are illegal, is the harassment from the IRS a social construct?
Yes, those are social constructs. Except the fist, as a fist is a physical object. Consequences for cosplaying a Nazi are social constructs though.
What isn’t a social construct is food, and needing to eat it, as an example. I would then say that food has inherent value to humans. It is worth something to you no matter the society.
Something being a social construct doesn’t make it not real. It simply means it’s not based in physical reality, but in social reality.
One time someone told me that paper money is worthless, so I said, fair enough—I’ll take that worthless paper off your hands.
He, uh, didn’t take me up on it.
Paper money doesn’t have inherent worth. But that doesn’t make it worthless.
I feel like people hear “made up” and think it’s the same as worthless. But it actually just means it’s a social construct.
Gold also doesn’t have inherent worth, nothing does (economically speaking). Gold is worthless when you’re dying of thirst in the desert, while water is worthless while drowning in a lake. What makes gold interesting as a unit of exchange and account is its limited supply, and quite stable inflation.
Stable inflation is relative, though: The Spanish managed to tank their economy back in the days with all that gold they imported from South America. But in these days, yep, it’s a steady trickle of new gold.
You can also wear it as jewellery which is a thing some people do, technical applications are limited, or, better put, require very little amounts of gold (mostly just plating for corrosion resistance, bond wires, such things). Sure you can recycle a CPU and get some gold out but you won’t get rich off it.
Fiat currencies, if administered sensibly (i.e they’re reasonably price-stable) are backed by the economical base of the region that issues them: A Euro has the use-value of an espresso because Italians have espresso machines and can work them.
The actual goal of political economy should be the well-being of the people. Price stability can be a means to that end, but it can also diminish standards of living. Certainly, price stability is not an end in itself.
To clarify what I mean, this current inflationary period is being caused by transient supply disruptions. They’ll clear up on their own. Apart from Japan, what are the central banks of the world doing? They’re trying to throw their economies into recession. Because of transient inflation that was not caused by runaway demand.
It’s tricky to talk about actual gold standard days, since economic data aren’t very reliable that far in the past, but historical accounts don’t exactly paint a rosy economic picture. Whether there was price stability, I’m really not sure, but I do know there was mass unemployment, frequent economic crises, and widespread poverty.
Finally, the Eurozone… Their recession following the global financial crisis lasted longer than other advanced economies, because the Stability and Growth Pact is the opposite of sensible economic administration. Indeed, Europe is in a downward binge-purge spiral of—crisis happens, better ignore excessive deficit rules and let the ECB buy sovereign debt at its discretion; well the crisis is over, time to fuck up European economies again; oh no there’s another crisis, better ignore the SGP again.
At some point I might have to leave the US, so it’s a shame that Europe isn’t a viable alternative.
Not at all. It’s caused by companies, especially food companies, thinking they can get away with price-gouging. Ukraine doesn’t export nearly as much wheat any more, however a) that doesn’t mean that pasta should get more expensive as Ukraine grows soft, not hard, wheat and b) speaking about the EU, we’re more than self-sufficient when it comes to soft wheat and, by and large, didn’t import from Ukraine, or anyone, for that matter. Hence also why re-organising logistics to ship Ukrainian grain to the EU to then ship onwards was not at all easy to set up.
Gas also isn’t really an issue any more. What might be a valid point is costs due to companies diversifying everything, but that’s the good kind of costs.
…because too few member states have bouncing back from crises down as well as Germany does. It’s not a secret how we’re doing it but other states don’t seem to get that with a central bank focussed on price stability, you have to have some policies in place. Things like having a Kurzarbeit regime should probably get written into the Eurozone accession criteria because certain countries still seem to be in the “we’re going to inflate ourselves out of the situation” mindset which of course won’t work if you can’t inflate.
Nothing has inherent value. Inherent value shouldn’t be confused with practical value. Anyway, while gold has some practical value nowadays, being a corrosion resistant electrical conductor doesn’t explain why people wanted gold more than a hundred years ago. Thinking there’s something special about gold that makes it valuable irrespective of social beliefs or practical uses is just… the world’s least interesting religion.
The fact is, money has value because it’s the only thing that can be used to pay taxes. So for the next level, I’ve never quite understood what “social construct” means. Is being punched for cosplaying a Nazi a social construct? Not the justification, but the fist, is the fist a social construct? Is being harassed by the IRS because you’re a sovereign citizen who uses self-issued Freedom Dollars and doesn’t believe the Sixteenth Amendment was duly ratified so income taxes are illegal, is the harassment from the IRS a social construct?
Yes, those are social constructs. Except the fist, as a fist is a physical object. Consequences for cosplaying a Nazi are social constructs though.
What isn’t a social construct is food, and needing to eat it, as an example. I would then say that food has inherent value to humans. It is worth something to you no matter the society.
Something being a social construct doesn’t make it not real. It simply means it’s not based in physical reality, but in social reality.