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Spiral Architect

Fiat Money as Economics’ Floating Abstraction?

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Man’s history is a process of developing better ideas and turning those ideas into something useful.  He hunts better when he develops weapons.  He eats better when he learns to farm the land.  He farms the land better when develops tools to farm.  He develops more food when he develops away to preserve food or save stock for future use.  He specializes when he develops tools to move the stock he saved to other like-minded people. Etc, etc, etc, until one day he buys something in France with a piece of plastic and the value is deducted from his savings half a world away… instantly.

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A curious development in the process was that property also became not a tool for action NOW but a tool for action LATER. Man could store value for the future. A hunter could save his kill for tomorrow and a farmer could save his stock for next season. Early man as hunter-gatherer had to consume his work today as his survival depended upon it, much like most animals. But as man evolved into a human greater than the animals his ability to thrive was goal directed by his ability to think and save work one day to be consumed at a later day, thus saving time and being able to plan and specialize. Savings is unconsumed work saved for the future, once a few fur skins and a good harvest and lauded as a virtue is today seen in investments and profits which is now seen as a vice – Exposing the true ethical violation of those who damn such primal life giving activities.

Eventually this store of value would give rise to a need for a more transferable and durable form of exchange, eventually barter property would become money. This does not change the fact man still stored value in property. As civilization advances and free exchange is allowed, stores of value become complex, subjective, and even abstract at times. Man today is just as likely to have savings accounts, gold bars, expensive pictures, land, small fractions of corporations, or even a bit coin in virtual reality.

Land is the subject, and once man had to use land as if his life depended upon it, because it did depend on it. The closer we come to a Bronze Age level culture we see the absolute need to farm, gather, or at minimum contain livestock. As man advances however his need to act and consume daily like his Bronze Age brethren falls to the side as he can act in one part of his life and save/enjoy in other parts of his life. Property had to be used; today it can simply hold values until one is willing to use it or trade it away. Such is the benefit of living above the hunter-gatherer stage and not having to use it or lose it.

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Etc., etc., etc., — money as an extension of property rights, a tool of exchange or trade, and (much more importantly) a tool of savings.. Nice tie-in.

Edited by dream_weaver
add some more relevant portions of the quote.

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Then there are things that jog the recollection of this thread. I attended a high school production of the play "Fiddler on the Roof". In the pamphlet, one line in particular jumped out and provided a lens to view the play thru. "From beginning to end, the play employs the metaphor of the joyous fiddler delicately balancing atop a treacherous roof."

The play has a minor individualism subplot which contrasted against the arranged marriages of the day. One of the songs performed in the play is "If I Were a Rich Man". I found myself turning over the superficial treatment of money in the play, to eventually have quote "Money is the material shape of the principle that men who wish to deal with one another must deal by trade and give value for value." Then I recalled this thread. A short consideration of bartering, men trade one material for another after agreeing upon the exchange. A commodity based, or specie trading sets up an algebraic means of working with value in a material sense.

Instead of determining how many eggs to trade for a bicycle, the various goods and services can be expressed in the form of a common denominator, with then can be held up to each other and compared more readily. A bank account, if you will, can purchase a selection of material goods and/or services that do not exceed the value of the account.

In a contractual society, contracts are written on paper. Paper currency can serve as a form of a contract. It becomes a floating abstraction when the fine print of what that contract stood for becomes forgotten. The history of money over time becomes legends of money. Given enough time, legend can become myth.

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