Hugo Chavez, cryptocapitalist

[maradydd]

I am not the world's biggest fan of Hugo Chavez, but sometimes, the dude comes up with some really good ideas. I don't agree with his blanket-condemnation sentiments about capitalism -- they make more sense interpreted as a slam against mercantilism, the belief that a nation's power depends on its supply of capital -- but bartering goods and

Comments

[nibor]

I'm not sure exactly what you're trying to get at with all this. I mean, barter is fine when both sides have something the other wants, but often it becomes more complicated than that. You're not suggesting getting rid of money, right?
Or are you suggesting tying a currency's value to a particular good, like gold, or oil? That's fraught with it's own peril - what happens when a new use for gold comes about? What happens when new techniques appear for pulling more gold out of the ground? What happens when someone figures out how to synthesize gold cheaply and practically on a large scale? Fiat currency at least isn't at the whim of human invention.

[maradydd]

No, I'm not in favour of tying currency to any particular good, for exactly the reasons you mentioned; a quick look at the history of the 1500s and 1600s should be enough to give even the most ardent gold-standard supporter the willies.

But the whole point of the last half of my rant above is that fiat currency is absolutely dictated at the whim of human invention -- or, more properly, the whim of human whim. Ben Bernanke can arbitrarily decide to authorise the injection of a trillion new dollars into the economy, and wham, it's so -- the Fed has basically no oversight whatsoever, and its actions are very, very difficult to reverse.

[songblaze]

I suppose my trouble with barter system is that intangibles get harder to value.

I mean, by the time I get done with my JD I'll have had to do in theory 7 years of school (actuality will be 9-10, but 2 of those are me getting sidetracked to the history degree and if it's 10, 1 will be due to me being, y'know, less than healthy)

So...how do you value intellectual output in that kind of a system? It seems to me that it's likely to get devalued from where it is now - that your doctors and lawyers and other highly educated positions are going to lose some of the paycheck that is a big incentive towards most people that go towards those careers (particularly lawyers, ime).

So how do you get people into those positions, then?

[maradydd]

Note that I'm in no way advocating a complete return to the barter system, or (as nibor thought) getting rid of the notion of money. Having a consistent form of value as a medium of exchange is the greatest thing that's ever happened to civilisation; throwing that out the window would set us back thousands of years, quite literally.

My objection, as I said above, is to fiat currency -- a medium of exchange that can be debased by the actions of one man, in the system we have right now. The Fed has injected over $64 billion into the US money supply over the last couple of months, which means that the money in your bank account right now is worth that much less than it was three months ago. If the Fed continues to expand the money supply in response to the enormous amount of bad debt generated by the subprime mortgage fiasco, the money you have will continue to be worth less and less. Did the value of the work you did three months ago somehow become less? In terms of absolute value, of course not, but in terms of the medium of exchange we're

[songblaze]

...er, well, yes, but at the moment I have a lot more debt than anything else, so really for the next couple of years reducing the value of a dollar is better for me, sadly. By the time I've got my law degree, I'll be (at a rough estimate) in the neighborhood of $140k in the hole. As long as entry-level positions in the law field keep pace with the devaluation, I'll be in a better position (though I'm rather chagrinned to look at it this way

[slimnerd]

Well, I have heard from time to time on how our money is becoming worth less and less and how some major catastrophe is on the horizon. Even without the money becoming worth less and less I have often tried to keep recurring expenses within my income(very small) and spend the surplus on nonrecurring expenses and new very useful items. When I hear again on how the money may crash in value I start thinking I need to spend any surplus I have because I think I might as well get the value of the money now rather than the diminished value later. I think many are going to start thinking along the same lines once it becomes clear the money is going to crash in value rather than slide down a slope slowly. It would be nice to have something else than this but what else is there? What else can most people in this world or even most in certain parts of the world use to barter with? Gold, oil, and other commodities are not really an option for most people. What is there that retains value that can be purchased(or otherwise acquired) by practically