MCViewPoint

Opinion from a Libertarian ViewPoint

Posts Tagged ‘dollar’

Why Does Money Have Value? Not Because the Government Says It Does. | Mises Wire

Posted by M. C. on October 10, 2021

Contrary to the popular way of thinking, the value of a paper dollar originates in its link to gold—and not government decree or social convention. Following Ludwig von Mises’s regression theorem, money must have originated as a commodity. Furthermore, the fact that an entity has established a purchasing power with respect to various goods and services does not automatically qualify it as money, i.e., as the general medium of exchange. For the entity to become money, it must have wide acceptance.

https://mises.org/wire/why-does-money-have-value-not-because-government-says-it-does

Frank Shostak

Why does the dollar bill in our pockets have value? According to some commentators, money has value because the government in power says so. For other commentators the value of money is on account of social convention. What this implies is that money has value because it is accepted, and why is it accepted? … because it is accepted! Obviously, this is not a good explanation of why money has value.1

The difference between Money and Other Goods

Now, demand for a good arises from its perceived benefit. For instance, people demand food because of the nourishment it offers them once consumed. This is not so with respect to money. According to Murray N. Rothbard,

Money, per se, cannot be consumed and cannot be used directly as a producers’ good in the productive process. Money per se is therefore unproductive; it is dead stock and produces nothing.2

Why, then, is there demand for money? Why do individuals desire to have something which cannot be consumed and produces nothing? To provide an answer to this one must go back in time to establish how money emerged.

In trying to improve their lives and well-being, individuals discovered that by replacing direct exchange, where individuals exchange one good for another good, with indirect exchange they could enhance the marketability of their produce. The introduction of indirect exchange means that the produce of an individual is exchanged for some more marketable good and then this good is exchanged for the produce of another individual.

The key to a good’s emergence as a mediator of indirect exchange is that it must be widely accepted. On this, Ludwig von Mises observed that, over time,

there would be an inevitable tendency for the less marketable of the series of goods used as media of exchange to be one by one rejected until at last only a single commodity remained, which was universally employed as a medium of exchange; in a word, money.3

Similarly, Murray Rothbard wrote that,

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Contact Frank Shostak

Frank Shostak‘s consulting firm, Applied Austrian School Economics, provides in-depth assessments of financial markets and global economies. Contact: email.

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The Worst “Fact Check” Ever

Posted by M. C. on July 28, 2019

Truth is treason in an empire of lies.

https://blog.tenthamendmentcenter.com/2019/07/the-worst-fact-check-ever/?fbclid=IwAR0bSIisduyxs0rh37wj8UtBV_ZBq18qV0T7XzZe_N3dHTwSJQ_8jF-KdYE

By:

Voice of America has responded! And it may well be the worst “fact-check” and rebuttal in the history of fact-checks and rebuttals. As Ron Paul Institute executive director Daniel McAdams put it, “Unbelievable! They confirmed everything you said as true and then pronounced you wrong!”

This revolves around an interview I did on RT where I talked about how the U.S. weaponizes the dollar and uses the global SWIFT payment system as a foreign policy billy club. The Voice of America “fact-checking” website Polygraph.info contacted me for comment. Since it was clear they intended to discredit my narrative, we decided not to respond to their email but instead write a full-blown rebuttal of the narrative that I knew they would advance.

This worked out even better than I anticipated. Polygraph.info actually responded to my pre-rebuttal. And in their response, they basically conceded my main point – that the U.S. government can and does use SWIFT as a foreign policy tool. Of course, they tried to downplay the significance, but their concession is telling.

“While the U.S. has the ability to pressure SWIFT thanks to its position in the global economy, it could be limited by potential costs that would be felt by U.S. businesses and those of U.S. allies. An Atlantic Council opinion piece warns the U.S. Congress to ‘be wary of taking unilateral steps to target SWIFT in future legislation,’ adding the practice risks hampering the flow of financial data, “slowing global trade and transactions.” Moreover, the U.S. does not directly control SWIFT.” [Emphasis added]

McAdams is right. This essentially confirms what I said — No. The U.S. does not control SWIFT, but it can exert significant pressure on it.

“So, despite what VoA and the Treasury Department claim, the U.S. government clearly pressures SWIFT to serve as a foreign policy tool. It may be technically accurate to say the U.S. government does not ‘control’ SWIFT. But the U.S. clearly applies political pressure on the institution and that pressure yields results.” [Emphasis added]

The Atlantic Council piece Polygraph.info links to confirms what I wrote. The very fact that somebody felt the need to warn Congress about the consequences of abusing its influence over SWIFT indicates that my position is absolutely correct.

Polygraph.info chose to ignore most of the points that I made in my pre-rebuttal article, writing that they were “beyond the scope of this fact check.”

This is an odd statement considering my article addressed the substance of what they were supposedly fact-checking. So basically, the very thing they were fact-checking was beyond the scope of the fact check.

OK.

As Ron Paul once said, “Truth is treason in an empire of lies.” The fact that a propaganda arm of the U.S. government wants to whitewash the truth about America’s economic warfare is telling. Its inability to effectively do it is even more so.

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truth

 

 

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