On Sun, 26 Feb 2012 08:48:05 -0500 d...@geer.org wrote: > > Well put, James. Warren Buffet's arguments are, to my eye, > aligned with yours. He argues that gold has no intrinsic > value, unlike farmland or a company like Coca Cola. In that > way, his evaluation is as instrumentalist as is yours, to the > extent that I understand the both of you. His discussion of > gold, per se, is getting some press. See > > 2011 shareholder letter > www.berkshirehathaway.com/letters/2011ltr.pdf > > What I would add to your analysis of fiat currency is to agree > that nails, moonshine liquor, and antibiotics are replacements > for fiat currency, but I must also note that the modern economy > is all but totally dependent on large enterprises which, because > of their largeness alone, simply cannot engage in barter.
It is not just about big business, it is also about maintaining a functioning government. There is too much specialization in society for courts to assign damages in terms of nails, whiskey, cattle, rice, or whatever else. How does the government assess a fine in terms of barter? Money and government go hand in hand. Governments need money in order to manage taxes, fees, fines, and so forth; yet money becomes valuable because of the legal structure that surrounds it, which is as true for gold as it is for fiat currency. Even if you could become completely self sufficient, to the point of not have to trade with anyone, you would still need to pay taxes and fees (property taxes, hunting license fees, etc.), and you will need to make those payments in a manner that is accepted by the government (i.e. the money issued by the government). Barter systems, de facto currencies and so forth only work on small scales. -- Ben -- Benjamin R Kreuter UVA Computer Science brk...@virginia.edu KK4FJZ -- "If large numbers of people are interested in freedom of speech, there will be freedom of speech, even if the law forbids it; if public opinion is sluggish, inconvenient minorities will be persecuted, even if laws exist to protect them." - George Orwell
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