(Incidentally, Brian McAndrews's recent suggestion that the value of an
international currency could be based on potable water is an excellent one.
There is nothing more basic or universally required than this resource.)
An important characteristic of a good "measure of value" is that it be difficult to reproduce.
We can catch fish, make chairs, produce cars, or manufacture "money".
Money is infinitely preferable.
You catch fish and you have fish. You make chairs and you have chairs. You produce cars and you have cars. But, if you manufacture "money" you have all these things and 10,000 other things as well.
Better to manufacture money!
Of course this leads to a flood of "money" and the value of it goes down. (This is really "inflation", which you'll recall isn't an economic term at all but a simple physical term meaning an increase in volume.)
We can prevent this by building an enormous anti-counterfeiting structure.
Or by using as a measure of value something that by its nature is not easily reproducible.
Gold fills the bill. Incidentally, there are others, and in a international free market system, though gold will be the key, other things with somewhat stable values (perhaps including potable water) will be observed by the managers and speculators in the world economy.
However, that doesn't affect us as we pop into the Fish Emporium for an order of fish and chips. Hey, I brought us back to the thread!
Harry
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Harry Pollard
Henry George School of LA
Box 655
Tujunga CA 91042
Tel: (818) 352-4141
Fax: (818) 353-2242
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