Monday, September 10, 2018

As basic as it gets

Required reading for all high school juniors, at a minimum;
"Money is different from all other commodities: other things being equal, more shoes, or more discoveries of oil or copper benefit society, since they help alleviate natural scarcity. But once a commodity is established as a money on the market, no more money at all is needed. Since the only use of money is for exchange and reckoning, more dollars or pounds or marks in circulation cannot confer a social benefit: they will simply dilute the exchange value of every existing dollar or pound or mark. So it is a great boon that gold or silver are scarce and are costly to increase in supply.But if government manages to establish paper tickets or bank credit as money, as equivalent to gold grams or ounces, then the government, as dominant money-supplier, becomes free to create money costlessly and at will. As a result, this ‘inflation’ of the money supply destroys the value of the dollar or pound, drives up prices, cripples economic calculation, and hobbles and seriously damages the workings of the market economy.” – Murray Rothbard
This is basic economic theory, since demand and supply of services, goods and materials are at work without artificially created "paper tickets," that do nothing but distort the real market.
If you don't believe this, you need to hang from a lamp post.
H/T to James Rawles at Survivalblog.

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