new money systems

[Vladimir Z. Nuri]

note: one respondent on this subject claimed that my references
to the money system only applied to the US. in fact I believe
they apply to any country that is paying interest on government
bonds!!

>Start with "Money Mischief" by Milton Freidman for an interesting look at
>the role of money.

an interesting book, I think this is one of his I browsed. MF is correct
in some ways but I believe he is off the mark in others. gold has a  key 
advantage over money printed by a government in that it can't be
counterfeited even by that government.  

it is clear to me at this point that any government that pays interest
on its bonds without loaning out that money is actually counterfeiting
its own currency. this interest paid on bonds is the direct 
cause of inflation.

>Money has three functions:

of course all three are interchangeable in a complete economy.

>If anyone was to adopt a 1920's lifestyle (few cars, no telephone or
>electricity, no indoor plumbing in many places) they would have plenty
>left over.  As long as consumption is the goal, you can keep working
>longer to satisfy more marginal wants.  If I can convince a couple that
>they "need" two luxury cars, they will work the longer hours.  If they are
>satisfied with something less, they may get by with only one earner. 

no, actually I think that this is not entirely true-- even measured for this
factor, our money has lost force. consider some job that has not 
changed in nature since then, say plumbing or farming. I believe on
average that today's plumber or farmer must work harder than the 20's
farmer to achieve the same lifestyle. in fact this can be proven 
mathematically in a post I'm working on.

>
>We work "harder" and have less free time only in the sense that we prefer
>working longer hours and having expensive things and less free time to
>working shorter hours and having more free time.

a reasonable hypothesis, and partly correct imho.

>It is called economic inefficiency (the electrical analogy might be
>resistance).  If tarriffs are imposed on an import, I end up paying the
>domestic producers a little more.  If some regulation forces an employer
>to spend $100,000 printing manuals or something, he is spending that to
>satisfy the government and not me.  And then there is the obvious "tax",
>which you pay regardless of who sends the actual amount to the government
>(e.g. the "employer's" half of FICA).

what I am trying to imply in the post is that there is actually a hidden
resistance on our money that is not reflected in the fees that various
entities charge.  this is inflation, and it it can be totally controlled,
despite whatever lies the Fed tells the public.

>The problem is one of exchange.  A local currency (banks used to issue
>their own notes) is only good in that locality.  How do I buy a California
>pistachio with Michigan Money?  Or with British Pounds for that matter. 
>In all cases you get an exchange rate.  There will be a varying ratio
>between any two given fiat currencies, and even two currencies based on
>(i.e. redeemable in) different commodities.

so what? I understand this obvious and trivial point.

>But all the above won't fix any of your above points.  You will work
>harder and be taxed on barter points, hamburger coupons, or anything else
>based on their (hopefully discounted) value in dollars.  I will still have
>to spend more of whatever to get a car with an airbag which I don't want.

a local economy can have a currency, and ask the question, "why is 
value being extracted from our local economy when it is a self-sustaining
unit"? the idea behind a local currency actually encourages local
autonomy/sovereignty/independence.

>The only reason we have national currencies is because nations have
>different ideas about how large their inflation rates and defecits should
>be and about trade.  That way they can control the supply of that currency
>and require changing into that currency to do trade.

the reason is that, imho, a set of greedy people have realized they
can enslave the population of an entire country by manipulating the
currency supply.

>Having 1000 other currencies would mean that each currency would have a
>fluctuating value relative to each other (great if you are an
>arbitrageur), 

no, this is not a problem, but a solution. as our world markets show,
it is trivial to convert between currencies and each one acts as a
check and a balance on the other. if a currency declines in value to
another in the market, I will bet you the country whose currency
declined is "counterfeiting its own money" via interest rates paid
on bonds.