I'll start with my usual non-disclosal- Not only am I not an economist, I have no professional accomplishments I care to share.
Other than I can write and have a certification in adult education, how grown up are you?
Because today we're going to talk about money and that tends to bring out the worst features of people.
There at least 3 views of money and I'll dispense with the most ignorant first- Money is a store of value.
"ek" you say, "what about my 401k? My Stocks and Bonds? My Trove of Gold?"
Can you eat it?
I say that without cynicism. You are caught in social convention. "Confederate" currency is exactly as valuable as it's always been, even more so because of scarcity.
It's worth exactly what you can trade it for that has more utility than a tattered scrap of paper.
Yes, we have no bananas
I think Mr. Mellish is a traitor to this country because his views are different from the views of the President and others of his kind. Differences of opinion should be tolerated, but not when they're too different. Then he becomes a subversive mother.During World War 2 bananas became a prized and valuable commodity in England because many of the ships that would normally transport them were conscripted for vital war materials instead of tasty potassium filled breakfast cereal toppings, or sunk by U-Boats.
But the thing about bananas is that they're rotten after 3 weeks and valuable only to fruit flies at a distinct discount whereas Sherman tanks light up like Zippos every time.
What about Gold?
What about it? It's ductile and non-reactive. It's a good conductor. It's shiny and yellow, just like a banana, and it doesn't attract flies, only homicidal madmen.
The Classical View of Money
In the beginning there was a market in the sandy streets of Ur. Some people had Cows, some people had Goats and some people had Chickens. Some people had pots you could put things in.
Now it is hard to arbitrate the relative value of Cows, Goats, and Chickens to say nothing of the difficulties in storing them (there is the cost of food offset in part by their other useful by products like eggs, milk, and shit) so pot makers started manufacturing Cow, Goat, and Chicken tokens (made of dirt) that you could trade or store (in pots, also made of dirt) in a hole in the desert (acres and acres of dirt).
But theoretically you could take purse full (this is Ur dummies, no pockets) of Chicken tokens down to the market and walk back with a flock of Chickens. Or you can go to the Goat vendor and negotiate a trade of virtual Chickens (he'd have to go to the Chicken vendor to redeem them) and walk back with a garbage disposal unit.
Or, if you had a big enough pot in the desert, you could get a Cow to tip (some people think this is funny, I think it's just cruel).
But ek. what does this have to do with money?
Who said: "Two vast and trunkless legs of stone
Stand in the desert. Near them on the sand,
Half sunk, a shattered visage lies, whose frown
And wrinkled lip and sneer of cold command
Tell that its sculptor well those passions read
Which yet survive, stamped on these lifeless things,
The hand that mocked them and the heart that fed.
And on the pedestal these words appear:
`My name is Ozymandias, King of Kings:
Look on my works, ye mighty, and despair!'
Nothing beside remains. Round the decay
Of that colossal wreck, boundless and bare,
The lone and level sands stretch far away".
So I go out to the desert and dig up a Cow pot of Chicken tokens and take them to the market in Ur and...
What's that you say?
There hasn't been a Cow market in Ur for 5,000 years?
Well, at least they have some interest as antiques (always auditioned for Judas hoping to get Pilate and ended up Herod. Natural Tenors are a rare thing.).
My point (and Samuelson's) being that money has no intrinsic worth except as a medium of exchange and a temporary store of value.
In fact Cow shit is a better investment because you can grow things in it and the longer you leave your pot of Chicken tokens out in the desert the more it resembles dirt.
The Modern Monetary Theory of Money
OK ek. You've used classical economics to convince me that-
* You're a fool (in the classical sense).
* You think money is an illusion designed to distract.
* A little inflation is a good thing because it encourages people to invest in Cow shit which grows things instead of pieces of dirt placed in pots of dirt buried in dirt.
What difference does MMT make?
As an Eco 101 I wrestled with that question.
The fundametal difference is which came first. Chicken token or Dinosaur egg?
The MMT rise of currency has it's roots in social obligation. Remember those giant rings of stone? So a guy with a big club comes and wacks you into submission and demands you erect pyramids in honor of his escaping.
No eternal reward will forgive us now for wasting the dawn.
Anyway, MMT says that instead of a bottom up marketplace of money we instead have a top down imposition of servitude that can be forgiven by sacrifice of Cows, Goats, and Chickens.
Or Chicken tokens.
Now don't get me wrong. I'm attracted to MMT because it at least recognizes the ridiculousness of currency and has at is heart the understanding that the only real value of money is as a medium of exchange. Everything else is just arbitrary.
As are deadlines. I expect you will try to distract me from Baseball. Good luck with that.