What's Driving the Currency-Wars?

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cybrwurm
Spawn of Epicurus
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What's Driving the Currency-Wars?

Post by cybrwurm » 11-23-2011 02:09 AM

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/ Topic > What's Driving the Currency-Wars? / 22 Nov 2011 /
/ Newsgroups > alt.politics.economics , ab.politics /
/ E-mail > exchange@cbc.ca / Fantastic Forum > USA > Economy /
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] economist asks: So what's driving these so-called "Currency-Wars" anyway?
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Listen, money does not really have the power to do anything, let alone motivate anyone; money is merely the means of measuring value-transactions. Rather, it is the necessity for money, and also the love of money, that motivate people to their economic actions. Money - mainly paper (currency) and plastic money (credit cards, etc) - is basically nothing more than a promise (a promise to pay in the future). But the problem is that sometimes these promises have value, and sometimes they don't. It's the problem that empowered the financial meltdown a few years ago, and it's the same problem whether we're speaking of government promises (currencies and bonds), bank loans, or debt (national, corporate, and personal consumer debt). Credit (ie. all credit) is, therefore, inherently risky. So how can any given bank, financial institution, or nation identify both the good promises and the empty ones? Whose paper money actually has real value backing it up, and whose doesn't?
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Sometimes the matter rests entirely with the quality of the nation in question, and the nature of its government; being as it (supposedly) is, a sovereign state. If the nation (with both its political and economic system) has "value" (ie. tangible qualities), then its bonds and currency can be trusted to pay in the future. But how do you measure quality on a national and global basis? Can the markets do it? No. Can the investors and market-players do it? Again, no. And what about the not-so-civilized nations? How do you measure quality there? Very carefully, I should think. Well, one obvious element of national quality is the nature of its international relations, both economic and political, including its approach and attitude toward other nations, and the various leagues and unions of other nations. But what about the criminal nations? Can their money be trusted to retain value in the long run? These are the questions that will hang over the entire world during the current and upcoming "currency wars" that will be vital to the decades-long struggle to create a global civilization that has some small measure of stability and economic health ...
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-- a concerned citizen of the world - cybrwurm ;>
x
"Anyone who thinks that the truth is simple has got another think comming!" -- Grandpa Walton

bobbo
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Post by bobbo » 11-23-2011 04:11 AM

Money gives the bearer the ability to purchase goods and services from those willing to engage in such transactions.

What you talkin' bout Willis?
Vote all "NO NEW TAXES" Politicians out of office! This is killing the American Dream of having a Middle Class.

cybrwurm
Spawn of Epicurus
Posts: 35
Joined: 09-07-2011 04:59 PM

Post by cybrwurm » 11-23-2011 05:10 AM

] bobbo say: Money gives the bearer the ability to purchase goods
] and services from those willing to engage in such transactions.
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Right, value transactions. Money is what we use to measure the value of said goods and services.
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] b: What you talkin' bout Willis?
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About the currency-wars. Do you have any info regarding that, b?
"Anyone who thinks that the truth is simple has got another think comming!" -- Grandpa Walton

bobbo
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Post by bobbo » 11-23-2011 04:45 PM

Currency Wars? or Currency Trading? or fiat Currentcy or not being on a gold standard? I don't know what you are trying to talk about. Its all incomprehensive to me. I don't understand Economics. Currency war has to be some sub set of that right? so, I take the blame.

but when you start by saying money doesn't have the power to do anything--that is just nonsense.

In one real sense, humans interact economically on a barter and exchange system. Money monetizes that allowing a greater/simpler barter system. These transactions and others sum up in the trillions with an equal number of errors, mistakes, and frauds of all sorts. Not having power is not one of them.
Last edited by bobbo on 11-24-2011 08:02 AM, edited 1 time in total.
Vote all "NO NEW TAXES" Politicians out of office! This is killing the American Dream of having a Middle Class.

cybrwurm
Spawn of Epicurus
Posts: 35
Joined: 09-07-2011 04:59 PM

Post by cybrwurm » 11-24-2011 09:49 PM

] bobbo say: Currency Wars? or Currency Trading? or fiat Currency or not
] being on a gold standard? I don't know what you are trying to talk about.
] It's all incomprehensive to me. I don't understand Economics.
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wurm say: That's okay, bobbo. Even professional economists have trouble understanding Economics. All the more reason for philosophers to get off their silly analytical-butts and do something useful for a change! Grrrr …
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] Currency war has to be some sub set of that, right?
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That's bang-on correct. And here you just claimed that you didn't understand economics.
Is there a bit of false modesty going on around here that other pirates maybe ought to know about?
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] b: so, I take the blame.
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What blame are you talking about, b? I don't know what blame you are trying to talk about.
It's all incomprehensive to me. I don't understand blame. :)
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] but when you start by saying money doesn't have the power to do anything
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It has the power to be an idea ... [snicker]
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] -- that is just nonsense.
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The Merchant of Truth will most enthusiastically agree with you! That's why I started with such an outrageous statement. It's what journalists used to call 'the hook'. It's not really meant as a solemn philosophical declaration. You should know that I do this sometimes, just for dramatic effect (if nothing else). Just ignore these sorts of sentences if they bother you.
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] In one real sense, humans interact economically on a barter and exchange system.
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Right, the exchange of value for value is what I mean by 'value transactions'.
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] Money monetizes that allowing a greater/simpler barter system.
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Money (ie. paper and/or coin currency) allows measuring value to be *standardized* by providing all economic actors with a "fixed" measuring-rod. This is what money does, it *measures* value! The only problem with money is that there is no such thing as a fixed measuring-rod. This is why the gold-standard was needed in the first place; ie. gold *seems* to have more value (more weight, if you will) than the promissory-note stamped upon flimsy, rectangular pieces of paper (or plastic) and cheap metal-coins. Now some economists would actually argue that gold's "apparent" greater value is an illusion owing to this, that, or some other thing, but I would argue that *perception* is a large part of what determines value in the first place, and therefore if the majority of seven billion people see gold as the "money of last resort" then that is exactly what gold is, regardless of what this or that school of economic-theory might say.
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] These transactions and others sum up in the trillions with an equal number of
] errors, mistakes, and frauds of all sorts. Not having power is not one of them.
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uhhh ... well said ... I think?
"Anyone who thinks that the truth is simple has got another think comming!" -- Grandpa Walton

bobbo
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Post by bobbo » 11-24-2011 11:55 PM

wurm--that wasn't a hook, it was a flounder. But at least on follow up and response, we find ourselves in agreement initially. False modesty? With the secret joke, it was a toss up which of us deserved the label.

I don't understand the desire for the gold standard either. There were still booms and busts, frauds, drepressions and so forth under the gold backed currency. Never made sense to me that one country could get rich by digging up dirt in their back yard. I understand that some people say it would make the current manipulations more difficult but not impossible. With computers--I don't know what difficult means anymore.

Just one lack of understanding piling up on another. Everything is incomprehensive (?) to me!
Vote all "NO NEW TAXES" Politicians out of office! This is killing the American Dream of having a Middle Class.

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