one of the more well-followed of the whackjobs called “gold bugs”–dylan grice–today opined and was much quoted as saying that gold is “properly valued” at $10k an oz.
in order to further that irrelevant pomposity he makes any number of the usual suspect arguments.
to wit:
:”Yet free money does not, and cannot, exist”
Of course it does. It’s called “inherited wealth.”
Inherited wealth can be the road in front of the hospital, or the hospital itself, or the electric grid that supplies it, or the coal that powered the grid.
:”Since there can be no such thing as a government, or anyone else for that matter, raising revenue “at no cost” simple logic tells us that someone, somewhere has to pay.”
Since the statement is a tautology, it is irrelevant, except as the pose of some girley-boy poser puffing up about the fact that while “trading” is a 0 sum game, “life” isn’t.
:”But who? This is where the subtle dishonesty resides, because the answer is that no-one knows.”
this is where the massive stupidity resides, because the answer is “the future.” The future inherits the debt and the wealth simultaneously, returning the game to 0 sum.
This obvious fact is noted in the Preamble to the Constitution of the United States, “upon ourselves and our posterity.”
:”Isn’t asset price inflation (or bubbles as they are more commonly known) more distortionary and economically inefficient than product price inflation?”
No. Simply because “food and water” are “products” and oil and land are “assets,” asset price inflation automatically creates product inflation. Marx, not Adam Smith argued that this “double hit” meant that “means of production”–a catch-all term for “asset resources” needed owned by the state.
The actual distortion occurs through “measuring by comparative wealth” which is often miscalled “greed.”
:”We know that revenue cannot be raised for one person without costing someone else.”
Actually, nobody “knows that.” It’s just given as a rule when playing monopoly, the ultimate “comparative wealth” metaphor. Somebody striking a claim to a gold mine, and thereby turning acreage into revenue has cost nobody anything–except other gold mines–until “the future” lays claim on the increased supply.
:”the only correct thing to do is to create inflation to protect jobs.” is nonsense that requires addiction to goldbug bites to endure.
Forced demand (borrowing demand from the future) such as the Interstate Highway System, and forced supply to shut up the private money sources (tax cuts used to pay off personal debt). That is, until the private money sources have a new way to con the consumer, in which case the inflation is “growth.”
:”the drunk driving of macroeconomists is what led us to where we are today.”
Yes: Having this conversation via internet instead of horse carried quill scratchings on vellum.
“Gold” is no more real in any utilitarian sense than “faith and credit.”
Gold serves well in the same place as “inches.” There are lots of inches in a house, and measuring every transaction in terms of them is essential in building the house. But the house is not the inches.
when your financial advisor starts handing you tautologies and “we all know” and tries to peg your family’s vision for prosperity to the holding of some asset, rather than the building of enterprise, feel free to run.
Posted under business
This post was written by admin on September 15, 2011
