Money vs Currency. Explaining Gold.

[joshnorris14]

In both cases meat was scarce, so your point is invalid.

 

[Steven Douglas]

In both cases meat was scarce, so your point is invalid.

How do you figure? Meat is not scarce for Yufei now, but it was then. So how do you figure that it was scarce in both cases?

 

[Black Flag]

Aren't some things more valuable than others because they are scarce?

No.

Pixie dust is incredibly scarce - it is valuable? No.

You might value something BECAUSE it is scarce and you want it.

But it is not valuable BECAUSE it is merely scarce.

 

[Black Flag]

Hypothetically, how about if you were in a sealed box? Air becomes scarce ... the value goes up. Then would you pay for it?

The value does not go up..... for me. I am not in that box.

So exactly as you have shown, it is valuable for that person in the box - because THAT PERSON values it. People outside of the box don't give a hoot about it, that is, to them the value is zero.

 

[Black Flag]

One of the characteristics that makes something "money" is stable value. If paper money is so useless you can use it as toilet paper, it's not a very good store of value-and not a good substitute for money.

This is not true.

Please show one thing that has "stable" value.

Since value is merely a judgement of a person at a particular time, value for all things changes as the circumstance of a person changes.

Further value is always relative. The question always asked is "Valuable compared to what?"

My house is valuable, compared to my pencil.
My house is not valuable compared to my daughter.

 

[Steven Douglas]

No.

Pixie dust is incredibly scarce - it is valuable? No.

You might value something BECAUSE it is scarce and you want it.

But it is not valuable BECAUSE it is merely scarce.

Not a really good example, but let's roll with it anyway. If there was such a thing as Pixie dust, and it had desirable properties (e.g., could make you fly), it would be a like a form of Unobtainium, the actual value of which would be revealed as it was made available -- in whatever amounts.

Billionaire Richard Branson is trying to synthesize just such a form of Pixie dust. How much do you think some of the very wealthy on Earth (starting with Sir Richard himself) would actually "value" flying into space with the aid of Virgin Galactic's pixie dust? And if such flights were commonplace -what then? Not price. Value.

There's a reason why ancient art can be valued orders of magnitude more than superior workmanship today (even from China). Mass production versus "the only ones in existence" affects both value (desire, or willingness to have?) and price (a willingness to ask for more by the seller, or exchange for more by the buyer). This is not a difficult concept.

 

[Black Flag]

Not a really good example, but let's roll with it anyway. If there was such a thing as Pixie dust, and it had desirable properties (e.g., could make you fly), it would be a like a form of Unobtainium, the actual value of which would be revealed as it was made available -- in whatever amounts.

If you wanted to fly like a Pixie, the dust is valuable - to you.
IF you didn't want to fly like one, the dust is not valuable - to you.

The whole measure of value comes from you and your desires - and not from the dust or its desire.

 

[Steven Douglas]

If you wanted to fly like a Pixie, the dust is valuable - to you.
IF you didn't want to fly like one, the dust is not valuable - to you.

The whole measure of value comes from you and your desires - and not from the dust or its desire.

You identified the "From" part of value - the subject/subjective, but left out the "To" - or the object/objective. The "whole" measure of personal value comes from one times the other.

Value = Desire X Object (of desire). Desire alone is completely meaningless without the object to which it applies. Even if someone expressed an unnamed desire as a void, they are only establishing a variable that has yet to be identified. Desire times X = Value.

You are right that desire doesn't come FROM the dust, and that dust has no desire. The desire is FOR, not FROM, the dust. That's why we say "the object OF (of/from us) desire (to/for the object)".

 

[therepublic]

Not exactly, money has to be valuable. If it isn't valuable, it wouldn't be exchanged. Stated differently, if it isn't valuable, it isn't money.

If you really believe money has value because sheepel say so, I would like to sell you the Golden Gate Bridge.

 

[Domalais]

If you really believe money has value because sheepel say so, I would like to sell you the Golden Gate Bridge.

If you say sheepel, I will laugh at you.

 

[WilliamC]

If you wanted to fly like a Pixie, the dust is valuable - to you.
IF you didn't want to fly like one, the dust is not valuable - to you.

The whole measure of value comes from you and your desires - and not from the dust or its desire.

No, the pixie dust is valuable because large numbers of people desire to fly, thus there would be a market in which to trade it.

The whole measure of value comes from the marketplace, not the individual.

Individuals have desires, but those desires are not values. The value comes when the desire can be met by trade in the marketplace.

At least that makes more sense to me than equating value to desire, as you do.

 

[Black Flag]

Value = Desire X Object (of desire)

Calculation is per human, not via humanity or anything else.

IF you, the human desire =0

Value = 0 x (whatever) is .... zero.

Since we are talking reality and not things of fantasy, the second multiplier - the object - is moot.

If a humans doesn't value it, it has no value - as your formula demonstrates.

 

[Black Flag]

No, the pixie dust is valuable because large numbers of people desire to fly, thus there would be a market in which to trade it.

The whole measure of value comes from the marketplace, not the individual.

Bizarre.

The marketplace is merely a group of individuals. The marketplace does not have a brain or a body of its own. There is no such thing as a "market brain" - it is the additions and subtractions of individuals in aggregate that gives an appearance of it, but it is an illusion to believe it is corporeal.

Individuals have desires, but those desires are not values. The value comes when the desire can be met by trade in the marketplace.

You mean if I do not trade my legs and arms, my legs and arms have no value to me?

 

[WilliamC]

Bizarre.

The marketplace is merely a group of individuals. The marketplace does not have a brain or a body of its own. There is no such thing as a "market brain" - it is the additions and subtractions of individuals in aggregate that gives an appearance of it, but it is an illusion to believe it is corporeal.

If you are not aware of the phenomena of emergent properties and the complex behaviors resulting thereof then it will be difficult for me to explain, but no there is nothing bizarre about speaking of the marketplace as a separate entity from the individuals which comprise it.

Emergent properties are common in physics and mathematics and result in behavior of complex, dynamic systems that cannot be predicted by merely examining the properties of the constituent components in isolation.

You mean if I do not trade my legs and arms, my legs and arms have no value to me?

I am uncertain if I am being completely stupid or if you are being obtuse.

I use the word value in terms of what something is worth in the marketplace, not in terms of what you as an individual desire.

What you desire or what you 'internally value' is in no way the sense of the word value in terms of trade within a market, or 'trade value'.

Is this unclear?

So to use your grisly, perhaps pejorative example, your arms and legs have an 'internal value' to you which is determined by you alone, but no 'trade value' in the market.

 

[Black Flag]

If you are not aware of the phenomena of emergent properties and the complex behaviors resulting thereof then it will be difficult for me to explain, but no there is nothing bizarre about speaking of the marketplace as a separate entity from the individuals which comprise it.

It fails the same way generalities fail - you can review a group of people and determine a norm, but apply that norm upon a person and it is always wrong.

All human action is ultimately individual - and economics is the science of human action.

 

[Black Flag]

I use the word value in terms of what something is worth in the marketplace, not in terms of what you as an individual desire.

That's the point - the former does not work, and it is the latter that only counts.

The marketplace does not spend my money.
I spend my money.

What I value determines that expenditure, not the marketplace.

Menger figured this out 200 years ago

 

[WilliamC]

It fails the same way generalities fail - you can review a group of people and determine a norm, but apply that norm upon a person and it is always wrong.

All human action is ultimately individual - and economics is the science of human action.

Ah, so you are unwilling to consider that there may be emergent properties in economics which render the understanding of human economic interactions inexplicable in terms which only apply to the constituent components.

Got it.

As with many other things, the whole of economics is more than the sum of its parts.

 

[WilliamC]

That's the point - the former does not work, and it is the latter that only counts.

The marketplace does not spend my money.
I spend my money.

What I value determines that expenditure, not the marketplace.

Menger figured this out 200 years ago

I do not dispute you spend your money, but I still see you using value to mean desire.

What word do you use for 'value in the marketplace' versus 'value to you as an individual'?

Usually semantic problems can be quickly resolved with mutually agreed upon vocabulary.

Those that do not strive to achieve this confuse me.

 

[Black Flag]

Ah, so you are unwilling to consider that there may be emergent properties in economics which render the understanding of human economic interactions inexplicable in terms which only apply to the constituent components.


Got it.

If such a concept disputes that it is the individual that acts, then yes, its premise is fundamentally wrong.

Hitler did not kill a million Jews.

It was the solider who pulled the trigger that killed the person.

You want to try to stop the Hitlers - this has failed for 10,000 years - because the problem does not exist there.

It exist with the man who holds the gun and who would pull the trigger.

As with many other things, the whole of economics is more than the sum of its parts.

This may be true, but to argue that this whole refutes the parts is wrong.

 

[Black Flag]

I do not dispute you spend your money, but I still see you using value to mean desire.

Steven calculated it correctly.

Value = Desire x Object.

Since the object exists, it is moot in the equation.

What matters is the desire - if it exists, there is a value - if it does not, there is no value.

What word do you use for 'value in the marketplace' versus 'value to you as an individual'?

What context is "value in the marketplace?" How is this different than a value determined by a person

The marketplace does not buy an apple. A person does. The marketplace neither buys nor sells anything, people do.