Anonymous A started this discussion 15 years ago#4,830
All the gold in the world would fill 2 Olympic pools, and new gold isn't discovered very much.
So you have a set amount, and this set amount is supposed to serve a growing population, and a growing economy?
Well then you get deflation. And deflation is an annoying problem, prices will always drop, and money becomes harder to find. Because money rises in value over time, it is a good idea not to spend it and the economy freezes up. Dollars have to "split", that is you would trade in your 1 oz gold cert for 2 half oz gold certs and use those (because people trade in smaller denominations as the currency deflates). The faster the economy grows the faster gold deflates, and the less you want to spend it- growth stops growth.
Deflation causes all sorts of problems, there is a reason modern economies do not use it.
Anonymous B joined in and replied with this 15 years ago, 19 minutes later[^][v]#85,455
People desire goods, not money.
Auschwitz !b.8nkuAfGw joined in and replied with this 15 years ago, 1 minute later, 20 minutes after the original post[^][v]#85,460
> spout something informative about the paradox of value that could help people understand the bullshit way things work, and just make other people upset that my opinion is different.
I am too tired to elaborate.
brie !OudrPWaUDQ joined in and replied with this 15 years ago, 10 minutes later, 30 minutes after the original post[^][v]#85,473
I said people would hang on to their money, if there was a gold standard, and I went on to explain exactly why. It would rise in price quickly. If you wait you can get more goods for your money because of deflation.
(Edited 1 minute later.)
Anonymous E replied with this 15 years ago, 2 minutes later, 56 minutes after the original post[^][v]#85,493
Broseph !!fxnDb+Ve4 joined in and replied with this 15 years ago, 5 minutes later, 1 hour after the original post[^][v]#85,499
@85,487 (E)
People do desire money over goods. Money used to be only considered a secondary good, as it was only good for purchasing primary goods, which is what you really want. But in a modern economy, there are so many factors like money markets, investments, interest rates, money supply, etc, not to mentions the power and influence that having a lot of money can have without actually spending it, the security it can provide, and the opportunities it can open, that money is now considered a primary good. People strive to make money even before they know what they want, and sometimes they never do figure out what they want and end up just hoarding or doing stupid things with it in an attempt to buy happiness later. Obviously this isn't healthy, but it happens because we live in a culture where we have been conditioned to see money as a primary good.
Broseph !!fxnDb+Ve4 double-posted this 15 years ago, 17 minutes later, 1 hour after the original post[^][v]#85,505
@85,493 (E)
No, people want money now and worry about what it's going to be spent on later. Money is a liquid asset and therefore can be considered more useful than most goods and be readily available when you want to exchange it for a good and/or service.
Also, the point he's making is that when money is inflating, you want to spend it as quickly as possible on a good with a solid value. This way, your assets are protected from inflation. Basically, you want to spend your money before it decreases in value any further. Another way to think of it is if the cost of goods is going up every day, you want to buy things as quickly as possible before costs go up any higher.
During periods of deflation, the opposite is true. If your money is increasing in value, you don't want to exchange for a good that will not grow in value at an equal or greater rate. Another way to think of it is if everyday the prices on goods are going down, then you want to hold out on your purchases for as long as possible to see how low prices can go.
You can also think of it in terms of the real interest rate. The real interest rate in the nominal interest rate (what the bank is giving you) minus the inflation rate (or adding the deflation rate.) So, if the nominal interest rate is 2%, and the inflation rate is 1%, that means the real interest rate is 1% and you might want save your money. But if nominal interest stays at 2% and inflation goes up to 3%, the real interest rate is now -1%, which means that's you're losing money by leaving it in savings. Times like these are when people invest in things like gold. Now let's say that the nominal interest rate drops to 0.5%, but we enter a period of 2% deflation. This means that despite the drop in nominal interest rates, (most likely caused by excess savings because of deflation) the real interest rate is 2.5% and it's a good idea to keep it saved.
We'll have a quiz next Thursday, and enjoy your weekend.
Anonymous G joined in and replied with this 15 years ago, 3 hours later, 4 hours after the original post[^][v]#85,528
@85,499 (Broseph !!fxnDb+Ve4)
You won't fix this mentality by eroding the savings of poor people (inflation).
Anonymous G double-posted this 15 years ago, 2 minutes later, 4 hours after the original post[^][v]#85,529
@85,505 (Broseph !!fxnDb+Ve4)
Investing in gold or keeping cash reserves - neither of these are buying goods...
Fact is people want TVs now. They want computers now. They want cars and houses now. They want boats now. They want clothes now. People want goods.
The gold standard joined in and replied with this 15 years ago, 2 minutes later, 4 hours after the original post[^][v]#85,530
DEAL WITH ME, NERD.
Broseph !!fxnDb+Ve4 replied with this 15 years ago, 3 hours later, 8 hours after the original post[^][v]#85,553
@85,529 (G)
I don't think you've understood a word I've said.
Anonymous I joined in and replied with this 15 years ago, 5 hours later, 13 hours after the original post[^][v]#85,792
Typically you would show me where I was wrong and why.
Broseph !!fxnDb+Ve4 replied with this 15 years ago, 34 minutes later, 14 hours after the original post[^][v]#85,853
@previous (I)
I wouldn't know where to start since what you said has almost nothing to do with what I said. Therefore, I have no rebuttal, or at least no rebuttal that wouldn't involve me repeating myself, and I'm not going to do that without knowing what part of my comments you don't understand or disagree with. I think you should just read my comments over again.
Leo Vegas !gNoGoD5HzQ joined in and replied with this 15 years ago, 27 minutes later, 14 hours after the original post[^][v]#85,876
All the gold in TWO Olympic sized pools? Really? What about Scrooge McDuck?
Anonymous K joined in and replied with this 15 years ago, 4 minutes later, 14 hours after the original post[^][v]#85,884
@85,853 (Broseph !!fxnDb+Ve4)
People want goods, not money. I made this point first. If any could be said to be off topic, it is you.
People don't want $1m. They want a house, car, big tv, air con, computer, boat, clothes and food every week.
Anonymous A (OP) replied with this 15 years ago, 10 minutes later, 14 hours after the original post[^][v]#85,897
@previous (K)
And how do they get more houses, cars, tvs, computers, boats, clothes, and food? With the gold standard they stop spending. The longer the wait, the more goods they can get. This slows the economy. People stop using their services as they hoard their cash, and they themselves wait to spend. This cycle drives up demand for money and drives down demand for goods.
It's only in the current system that people will trade money for goods ASAP. Money flows fast, and there is no reason it should, your money won't double if you wait a couple years.
Broseph !!fxnDb+Ve4 replied with this 15 years ago, 11 minutes later, 15 hours after the original post[^][v]#85,904
@85,884 (K)
And I explained why you're wrong, and gave a lengthy explanation as to why money is a primary good and not just a means to those other goods. I'm not going to repeat everything I pointed out in my previous posts. You've said nothing that rebuttals the points I made, or given any explanation as to why you disagree with them. All you did was contradict what I said, and repeated what you said in previous posts. This tells me that you either have the mentality of a 12 year old and you're resorting to "yuh huh/ nuh uh" arguing, or, as I pointed out in my previous posts, you clearly just don't understand the points I made.
Anonymous L joined in and replied with this 15 years ago, 2 hours later, 17 hours after the original post[^][v]#86,035
@85,897 (A)
They want goods now. We can already wait for consumer goods to come down in price, but no one wants to wait, they want goods now! People will not stop using services, they either need the services or they don't, they can't put it off.
In the current system poor people attempt to save for a house. Except that they get nowhere because inflation steals their money.
Anonymous L double-posted this 15 years ago, 41 seconds later, 17 hours after the original post[^][v]#86,036
@85,904 (Broseph !!fxnDb+Ve4)
You're simply wrong. It comes down to the fact that people must eat. People need goods not money
Broseph !!fxnDb+Ve4 replied with this 15 years ago, 39 minutes later, 18 hours after the original post[^][v]#86,055
@previous (L)
Although you said it in an incredibly stupid way, I think the point you're trying to make is that people can't always hold on to their money because they have necessities, like food and shelter. However, there are needs, and then there are wants and luxuries. They can spend money on needs, and still hold off on buying the bigger house, better car, bigger TV etc. if they decide they're better off saving money, either because of deflation, interest rates, security reasons, etc. In other words, your point that you have to spend some money does not disprove any of the points I made about money being a primary good (at least in modernized Western culture), nor does it disprove my point that people have a tendency to save money when real interest rates are high, and people have a strong tendency to spend money when real interest rates are low and especially when they're negative.
Anonymous L replied with this 15 years ago, 1 hour later, 19 hours after the original post[^][v]#86,104
@previous (Broseph !!fxnDb+Ve4) > Although you said it in an incredibly stupid way, I think the point you're trying to make is that people can't always hold on to their money because they have necessities, like food and shelter.
I said exactly this but in fewer words. Perhaps you think padding out an idea is a sign of intelligence.
People can, but importantly, they DON'T put off purchasing a house, car, TV. If this were the case people would wait a year before buying any consumer electronic product. People want goods NOW.
Anonymous A (OP) replied with this 15 years ago, 1 hour later, 21 hours after the original post[^][v]#86,219
> We can already wait for consumer goods to come down in price
Now it drops faster. > they either need the services or they don't, they can't put it off.
And the services they don't need (luxuries)_can be put off, and they will still get them. People do not need goods right now, they need some good right now, and many goods are simply luxuries. > In the current system poor people attempt to save for a house. Except that they get nowhere because inflation steals their money.
Yes, the current system punishes you for saving (inflation). The gold standard is the opposite (deflation) and rewards saving.
Anonymous L replied with this 15 years ago, 4 minutes later, 21 hours after the original post[^][v]#86,229
@previous (A)
But people don't wait as it is, so why would they wait under your theory? People want these goods NOW.
lol a service can't be put off. You either hire caterers for your birthday/wedding/bar mitzvah or you don't. You can't put it off. People want luxuries NOW.
> Yes, the current system punishes you for saving (inflation).
Broseph !!fxnDb+Ve4 replied with this 15 years ago, 18 minutes later, 21 hours after the original post[^][v]#86,261
@86,104 (L)
It's called a demand curve. Not all posters have the same habits and lie on different areas of the curve, but the demand curve, and how people spend their money, shifts as the market shifts. Some people are early adopters and some people do wait a year before buying electronics, and even people on both ends of the spectrum change their spending habits according to how much money they have, what the market's like, and what other investments are available. Not everyone is an impulsive and immature spender, and even the ones who are don't disprove all the points I made showing that money is more of a primary good than a secondary good. Your last post still doesn't directly address any of my points either.
> People want goods NOW
People also want money NOW. You could argue that people only want the money now because people want the goods now, but that's not always the case. Sometimes people will put money into savings, or will hold off on a purchase, or make other investments. People don't always want goods right away, but people will never turn down money, or opt to receive money later. People don't always want goods now, but they always want money now. Do you think someone would turn down money just because they're not sure what they're going to spend it on? Do you think someone would be willing to accept goods as payment from their employers instead of money? Do you think people prefer bartering?
Broseph !!fxnDb+Ve4 double-posted this 15 years ago, 2 minutes later, 21 hours after the original post[^][v]#86,270
@86,229 (L)
Yes, services can be put off. You're assuming that all services have to be tied to special dates that can't be moved. People can put off things like haircuts, massages, car washes, etc.
Broseph !!fxnDb+Ve4 triple-posted this 15 years ago, 3 minutes later, 21 hours after the original post[^][v]#86,278
@86,229 (L)
Also, people do wait, but people don't wait lately because interest rates are so low and inflation rates are so high that the real interest rate is negative, and therefore people are punished for not spending their money, but only because of the way the economy is right now.
Anonymous A (OP) replied with this 15 years ago, 2 hours later, 1 day after the original post[^][v]#86,422
> But people don't wait as it is, so why would they wait under your theory?
I've explained this several times. One has inflation, the other has deflation.
Nice trolling, I'm done.
(Edited 29 seconds later.)
hamfist !!H5dpJbHDI joined in and replied with this 15 years ago, 8 minutes later, 1 day after the original post[^][v]#86,424