John G Root Jr
Not Valuable Money
Upcoming paper: "THE POWER OF TRANSACTION TYPE "A" WHEN MONEY IS DEFINED AS ONLY A PASSIVE RECORD OF VALUE AND NOT ALSO A TOKEN OF TRADE" M. Gauvin & S. Dominguez "Conclusion: Common every day practices in which money is conceived as both a measure of value and an article of trade of variable value, establish the circular relation where the standard unit of measure of value is also treated like an object of trade subject to “supply” and “circulation" and valued in terms of itself as if it were just another resource. As a standard measure of value it is required for all economic activity to enable the transaction of divisions of otherwise non divisible (non fungible) goods and services. But, as a commodity like resource, it must be supplied prior to any economic activity taking place. As such, it acts as a universal economic enabler and charged for at a per unit cost as if it were another industrial product. Said charges compound across value chain links and reiterations, geometrically inflating overall production costs, independently of any discretely measurable corresponding added value. This leads to a system wide instability, with the principle effect of exacerbating the demand for money beyond any supply, converting it into the most ubiquitous component of economic activity. By virtue of its universal demand, the money system interconnects all economic components into a single system of interdependency on the basis of its supply, over and beyond any non-monetary value of the corresponding goods and services. Because of this unique role as a sine-qua-non universal precursor, agents compete and/or conspire to accumulate positive balances to be exploited as economic leverage in transactions of goods and services, again independently of any non-monetary properties and virtues of these. This tendency to accumulate further exacerbates the system instability. According to fundamental control theory any unstable component of a system destabilising the behaviour of the whole system and ultimately all components are rendered unstable. Therefore it follows that individuals as components of the economy, will have their behaviour perturbed and destabilised leading to increasing otherwise unconscionable (corrupt) behaviour at all levels. When money is formally defined as solely a record of value and used accordingly, the money system is made Passive and therefore stable, only useful as a (stable) reference of value, required for representing divisions of value of otherwise indivisible goods and services. By virtue of money acting as a stable record/measure of economic activity, it cannot precede transactions and therefore cannot serve as leverage over economic activity. Thus, money only serves to inform control of economic activity without in any way imposing limiting imperatives exogenous to real world activity. Moreover, of the four transaction type permutations, type A transactions (positive buys from negative) serve to defuse risk in the system by reducing the total value at risk of non reciprocation and since there is no incentive to accumulate balances, there exists no bias towards type D transactions (positive buys from positive). Finally, as a Passive stable system the money system no longer can systemically destabilise (corrupt) the behaviour of its components, including individual agents i.e. you and I. "