Jump to content
House Price Crash Forum
Sign in to follow this  
Guest_FaFa!_*

Is Money A Good?

Recommended Posts

I have been thinking about the breakdown in exchange across the globe and the nature of money.

Basically, is money a good? Or is it just been treated like a good? To my mind, money is not a good, but simply a proxy for exchange/deferred consumption. However it is being treated like a good which is causing all of the problems. For example countries exchanging goods for money, but then hoarding the money and not exchanging it for other goods.

Share this post


Link to post
Share on other sites

I have been thinking about the breakdown in exchange across the globe and the nature of money.

Basically, is money a good? Or is it just been treated like a good? To my mind, money is not a good, but simply a proxy for exchange/deferred consumption. However it is being treated like a good which is causing all of the problems. For example countries exchanging goods for money, but then hoarding the money and not exchanging it for other goods.

Money should just be a proxy for goods and services, acting as a much more efficient form of barter than barter itself.

The problem, as I see it, is -

If you keep the amount of money constant, but the productivity of the economy grows, then the same amount of money can be exchanged for more goods and services. Whist great news for those sitting on a pile of money, this impoverishes anyone with any form of debt, including debt taken on to invest in productive capacity, because you need to produce more and more to repay the debt.

And if you try to increase the amount of money to keep pace with the economy, you may add too much money, leading to inflation/disincentive to save, and difficulties in price discovery.

And any entity that is given the power to create money will probably end up either owning the world or destroying the economy, or both, unless kept on a very tight leash.

[space left for the Fluffy solution to all of mankind's economic problems here, to be filled in later]

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 335 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.