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Re: How I Learned to Stop Worrying About Fractional Reserve …

  • Fri, Jul 10, 2009 - 07:29pm

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    Re: How I Learned to Stop Worrying About Fractional Reserve …

 

Furthermore, some heretical market forces questions about systems that serves society and generate damage to society:
 

With reference to what’s been said above, the majority of market participants, or let’s say people, will get short on gold. A diminishing minority will get gold on gold in abundance. We know that the theoretical end of the game is reached when one owns it all. This phenomenon hurts the economy. Would a government be able to tax this phenomenon away in a globalized world? Isn’t it easier to install a money-inherent tax with global effect?

From the public view, what’s more important: to maintain sound asset values, or to maintain economic activity and liquidity? Isn’t it from an economics viewpoint understandable to install a mechanism that grants up-and-coming individuals access to existing values (as presently exercised through thin air money) by implicitly and silently redistributing former accumulated values? Obviously fiat money isn’t the best solution, but sound money won’t be able solve the problem on an equal rights basis.

And a final remark with regard to an asset value based economy: if you run a business of making things, and you want to continue to run the business, then you need to continue to have customers. You probably shouldn’t give a damn what’s the asset value of your business, but you should care about your ability to add value to your customers whilst generating minimal waste. In our world this means more and more to focus on intangible assets, exactly people. Wouldn’t a sound money economy even increase an investor’s pressure to focus on plain tangible stock value? Would this improve our competitiveness?