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thegreatdivide

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Re: foundations
Reply #405 - Mar 11^th, 2024 at 2:33pm

MeisterEckhart wrote on Mar 11^th, 2024 at 1:26pm:

The illusion of value can be created out of thin air with the issuing of more banknotes.

Your error there: conflating 'value" (in that sentence) with issuing of banknotes (apart from the fact most money now exists in the form of digits in computers (both of government and citizens).

There is no illusion in the value of a fiat currency which is created out of thin air, if the issuing nation has a productive economy.

Question: how is the quantity of money in the economy increased, when the population grows and the standard of living is maintained or improved?

Quote:

However, that illusion is usually very quickly destroyed, causing a reversion to the likes of gold as a more reliable store of value - which is why the strength/weakness of the US dollar and the DXY are generally inversely proportional to the spot price of gold.

Spot Gold DXY
$1,628 114.10
$1,631 114.11

$1,744 107.13
$1,747 107.01

The U.S. Dollar Index (USDX, DXY, DX, or, informally, the "Dixie") is an index (or measure) of the value of the United States dollar relative to a basket of foreign currencies, often referred to as a basket of U.S. trade partners' currencies.

Note: "relative to a basket of U.S. trade partners' currencies" ...ie not gold.

Your ignorance about fiat currencies causes you seek out gold, a fools errand. Even bigger fools will seek Bitcoin.

The gold standard is no longer applicable, exchange rates of floating currencies are determined by nations' relative productivity. Your figures above merely confirm the relative stability of fiat currencies compared to the price of gold in US dollars.

Regardless of your quoted figures: inflation, unemployment, and cost of living in the real economy are the important factors, not any postulated relationship (now obsolete) of fiat currencies with the price of gold.

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« Last Edit: Mar 11^th, 2024 at 3:11pm by thegreatdivide »

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thegreatdivide

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Re: foundations
Reply #406 - Mar 11^th, 2024 at 2:59pm

freediver wrote on Mar 11^th, 2024 at 2:14pm:

thegreatdivide wrote on Mar 11^th, 2024 at 2:09pm:

freediver wrote on Mar 11^th, 2024 at 1:25pm:

Quote:

but we have problem; you can't describe the basis of what you are asserting.

Quote:

The convenience of money is a separate issue to belief in the currency's value, (which you admitted you can't explain).

I said the basis of the belief is irrelevant.

And I proved you wrong; if we still believed the earth is the centre of the unverse, we wouldn't be landing craft on Mars.

You are confused.

Coming from you, I can take this - based on your ignorant "shared belief" delusion - as a badge of honour.

Quote:

No-one else is arguing that belief can change the shape of the earth.

Indeed neither am I; and what has the earth's position to do with its shape?

But men believed - by "experience"/observation - the earth was at the centre of the universe ... for ages, until they discovered the reality.

Quote:

This is merely yet another example of your idiotic strawmen.

Oh dear: FD thinks the 'shared reality' (now obsolete) that the earth is at the centre of the universe is an argument about the "shape of the earth"; yet men WERE deluded by the 'shared belief' the earth was flat.

Just as you can't explain ("can't be bothered to explain") the basis of the 'shared belief' in the value of a fiat currency; while we now know its an obsolete belief.

The Oz dollar doesn't have value because the citizens 'believe' it will maintain its value....

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« Last Edit: Mar 11^th, 2024 at 3:08pm by thegreatdivide »

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thegreatdivide Gold Member Online Australian Politics<br /> Posts: 12487 Gender:	Re: foundations Reply #407 - Mar 11^th, 2024 at 3:07pm .
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freediver

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Re: foundations
Reply #408 - Mar 11^th, 2024 at 3:07pm

thegreatdivide wrote on Mar 11^th, 2024 at 2:59pm:

freediver wrote on Mar 11^th, 2024 at 2:14pm:

thegreatdivide wrote on Mar 11^th, 2024 at 2:09pm:

freediver wrote on Mar 11^th, 2024 at 1:25pm:

Quote:

but we have problem; you can't describe the basis of what you are asserting.

Quote:

The convenience of money is a separate issue to belief in the currency's value, (which you admitted you can't explain).

I said the basis of the belief is irrelevant.

And I proved you wrong; if we still believed the earth is the centre of the unverse, we wouldn't be landing craft on Mars.

You are confused.

Coming from you, I can take this your ignorant "shared belief" delusion as a badge of honour.

Quote:

No-one else is arguing that belief can change the shape of the earth.

Indeed neither am I; and what has the earth's position to do with its shape?

But men believed - by "experience"/observation - the earth was at the centre of the universe ... for ages, until they discovered the reality.

Quote:

This is merely yet another example of your idiotic strawmen.

Oh dear: FD thinks the 'shared reality' (now obsolete) that the earth is at the centre of the universe is an argument about the "shape of the earth"; yet men WERE deluded by the 'shared belief' the earth was flat.

Just as you can't explain ("can't be bothered to explain") the basis of the 'shared belief' in the value of a fiat currency; while we now know its an obsolete belief.

The Oz dollar doesn't have value because the citizens 'believe' it will maintain its value....

Correction: No-one is arguing that whether the earth is at the centre of the universe is influenced by what people believe. It is merely another of your idiotic strawmen.

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People who can't distinguish between etymology and entomology bug me in ways I cannot put into words.

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thegreatdivide Gold Member Online Australian Politics<br /> Posts: 12487 Gender:	Re: foundations Reply #409 - Mar 11^th, 2024 at 3:13pm .
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thegreatdivide

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Re: foundations
Reply #410 - Mar 11^th, 2024 at 3:30pm

freediver wrote on Mar 11^th, 2024 at 3:07pm:

thegreatdivide wrote on Mar 11^th, 2024 at 2:59pm:

freediver wrote on Mar 11^th, 2024 at 2:14pm:

thegreatdivide wrote on Mar 11^th, 2024 at 2:09pm:

freediver wrote on Mar 11^th, 2024 at 1:25pm:

Quote:

but we have problem; you can't describe the basis of what you are asserting.

Quote:

The convenience of money is a separate issue to belief in the currency's value, (which you admitted you can't explain).

I said the basis of the belief is irrelevant.

And I proved you wrong; if we still believed the earth is the centre of the unverse, we wouldn't be landing craft on Mars.

You are confused.

Coming from you, I can take this your ignorant "shared belief" delusion as a badge of honour.

Quote:

No-one else is arguing that belief can change the shape of the earth.

Indeed neither am I; and what has the earth's position to do with its shape?

But men believed - by "experience"/observation - the earth was at the centre of the universe ... for ages, until they discovered the reality.

Quote:

This is merely yet another example of your idiotic strawmen.

Oh dear: FD thinks the 'shared reality' (now obsolete) that the earth is at the centre of the universe is an argument about the "shape of the earth"; yet men WERE deluded by the 'shared belief' the earth was flat.

Just as you can't explain ("can't be bothered to explain") the basis of the 'shared belief' in the value of a fiat currency; while we now know its an obsolete belief.

The Oz dollar doesn't have value because the citizens 'believe' it will maintain its value....

Correction: No-one is arguing that whether the earth is at the centre of the universe is influenced by what people believe. It is merely another of your idiotic strawmen.

You argued that people's 'experience' confirmed their (delusional) 'shared belief' in the source of value of a fiat currency - which you can't explain, other than by saying people can exchange money for goods and services.

The question is: what is the source of the value a nation's currency, which enables citizens to buy goods and services. ?

You can't explain it, I can; you need a productive economy which enables the citizens to buy goods and services with the nation's currency.

I showed 'experience' is not necessarily reality.

Keep trying.

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thegreatdivide Gold Member Online Australian Politics<br /> Posts: 12487 Gender:	Re: foundations Reply #411 - Mar 11^th, 2024 at 3:32pm .
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freediver

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Re: foundations
Reply #412 - Mar 11^th, 2024 at 3:39pm

Quote:

You argued that people's 'experience' confirmed their (delusional) 'shared belief' in the source of value of a fiat currency - which you can't explain, other than by saying people can exchange money for goods and services.

Are you saying that people are incorrect to believe that they can exchange money for real goods?

I did not say it was delusional. I said it does not matter.

Quote:

The question is: what is the source of the value a nation's currency, which enables citizens to buy goods and services. ?

You can't explain it

I won't explain it, because it is beside the point. The only reason you are attempting to explain it is because you completely misunderstood what I was saying.

I am trying to explain something to a simpleton. I thought a very simple example (money) might help. It didn't. You just got more confused and are trying to redefine "the question" to something that is irrelevant. The point I am making, which you long ago forgot, has nothing to do with nations, GDP or fiat currency, and is just as valid in the absence of all 3.

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« Last Edit: Mar 11^th, 2024 at 4:40pm by freediver »

People who can't distinguish between etymology and entomology bug me in ways I cannot put into words.

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MeisterEckhart Gold Member Online Australian Politics Posts: 11878 Gender:	Re: foundations Reply #413 - Mar 11^th, 2024 at 3:42pm thegreatdivide wrote on Mar 11^th, 2024 at 2:33pm: There is no illusion in the value of a fiat currency which is created out of thin air, if the issuing nation has a productive economy. Ask the Chinese about their currency's illusion of value.
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MeisterEckhart

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Re: foundations
Reply #414 - Mar 11^th, 2024 at 3:52pm

thegreatdivide wrote on Mar 11^th, 2024 at 2:33pm:

Regardless of your quoted figures: inflation, unemployment, and cost of living in the real economy are the important factors, not any postulated relationship (now obsolete) of fiat currencies with the price of gold.

Yes, I know that. The price of gold reacts to the weakness of the US dollar. In the context of this discussion, so-called quantitative easing causes the US dollar to weaken on the DXY.

That is the relationship between the price of gold and the US dollar - and, as the price of gold is denominated in US dollars, it is a direct relationship.

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thegreatdivide

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Re: foundations
Reply #415 - Mar 11^th, 2024 at 5:42pm

freediver wrote on Mar 11^th, 2024 at 3:39pm:

[quote]You argued that people's 'experience' confirmed their (delusional) 'shared belief' in the source of value of a fiat currency - which you can't explain, other than by saying people can exchange money for goods and services.

Are you saying that people are incorrect to believe that they can exchange money for real goods?

No. I'm saying the 'shared belief' re the source of a fiat currency's value, the basis of which (shared belief) you said you can't exlain, is delusional; the source of a fiat currency's value IS the nation's productivity.

Quote:

I did not say it was delusional. I said it does not matter.[/quote[

My point is: delusions DO matter, including your lack of understanding of what is the source of a fiat currency's value. Many people will lose their shirts betting on Bitcoin, because of their delusional worries about fiat currencies, and lack of a gold standard (eg Meister's yearning for the return of the gold standard...)

[quote]The question is: what is the source of the value a nation's currency, which enables citizens to buy goods and services. ?

You can't explain it

Quote:

I won't explain it, because it is beside the point. The only reason you are attempting to explain it is because you completely misunderstood what I was saying.

You asserted the value of fiat currency is based on shared belief.... how have I completely misunderstood that assertion?

I explained it to show the error in your assertion: productivity, not belief (shared or otherwise), is the source of value of a nation's fiat currency.

Quote:

I am trying to explain something to a simpleton. I thought a very simple example (money) might help.

It didn't. You just got more confused and are trying to redefine "the question" to something that is irrelevant. The point I am making, which you long ago forgot, has nothing to do with nations, GDP or fiat currency, and is just as valid in the absence of all 3.

Fraudiver in full flight; I proved his 'shared belief' on ownership of Palestine, and his 'shared belief' on the source of a fiat currency's value, are both false, so now he wants to say the value of money has nothing to do with the value of nations' fiat currencies, or gdp (or gdp per capita), despite the fact nations trade with one another, and citizens must accept that the value (purchasing power) of their nation's fiat currency is related to exchange rates determined in external trade.

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freediver

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Re: foundations
Reply #416 - Mar 11^th, 2024 at 5:46pm

Quote:

No. I'm saying the 'shared belief' re the source of a fiat currency's value, the basis of which (shared belief) you said you can't exlain

What shared belief about the source? This is just another one of your idiotic strawmen. The more I try to dumb it down for you, the more idiotic your misunderstanding of everything I say.

Quote:

You asserted the value of fiat currency is based on shared belief.... how have I completely misunderstood that assertion?

It requires shared belief. If the person you are offering the money to does not believe that your money has any value, then you will not be able to use it.

Let me know if I need to dumb it down any more for you.

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People who can't distinguish between etymology and entomology bug me in ways I cannot put into words.

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thegreatdivide

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Re: foundations
Reply #417 - Mar 11^th, 2024 at 5:58pm

MeisterEckhart wrote on Mar 11^th, 2024 at 3:52pm:

thegreatdivide wrote on Mar 11^th, 2024 at 2:33pm:

Regardless of your quoted figures: inflation, unemployment, and cost of living in the real economy are the important factors, not any postulated relationship (now obsolete) of fiat currencies with the price of gold.

Yes, I know that. The price of gold reacts to the weakness of the US dollar. In the context of this discussion, so-called quantitative easing causes the US dollar to weaken on the DXY.

That's because of your (and others') delusions re the value of gold, and the yen (excuse the pun; "shared belief" in) the gold standard.

Read the history of the Gold Standard, and why Nixon abandoned it.

QE merely inflates bank reserves in a misplaced attempt to get a recession-hit economy moving again. (Note: banks can't write loans if customers aren't interested in borrowing, because of high unemployment.etc)

Quote:

That is the relationship between the price of gold and the US dollar - and, as the price of gold is denominated in US dollars, it is a direct relationship.

And irrelevent as far as determining the value of the US currency is concerned, in the post gold-standard era; only interesting to gold traders in the financial-industry casino.

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« Last Edit: Mar 11^th, 2024 at 6:25pm by thegreatdivide »

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thegreatdivide

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Re: foundations
Reply #418 - Mar 11^th, 2024 at 6:14pm

freediver wrote on Mar 11^th, 2024 at 5:46pm:

What shared belief about the source?

The (delusional) 'shared belief' regarding where the value of a fiat currency comes from - which you can't explain.

Quote:

TGD: You asserted the value of fiat currency is based on shared belief.... how have I completely misunderstood that assertion?

FD: It requires shared belief. If the person you are offering the money to does not believe that your money has any value, then you will not be able to use it.

Your error there: the value of a fiat currency doesn't require shared belief, its value is determined by internal and external macro-economic forces beyond the beliefs of individuals ie the result of the nation's internal productivity and in comparison to other nations' productivity.

A micro-economist like yourself (if you are even that) will apparently have trouble understanding that truth.

Quote:

Let me know if I need to dumb it down any more for you.

(Sigh)...the travails of teaching the ignorant, including people who assert "shared belief determines reality".....

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« Last Edit: Mar 11^th, 2024 at 6:22pm by thegreatdivide »

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thegreatdivide Gold Member Online Australian Politics<br /> Posts: 12487 Gender:	Re: foundations Reply #419 - Mar 11^th, 2024 at 6:17pm .
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