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Shelling Out: The Origins of Money (2002)

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Re: Shelling Out: The Origins of Money (2002)

#11

Post by xchaotic »

dalbasal wrote: post #10
Wildgoose wrote: post #4

I highly recommend that people read "Debt: The First 5,000 years" by David Graeber which is a fascinating and erudite exploration of the development of money.

I've made that recommendation, with mixed results. I think it has less impact unless you studied/read a little classic economics. Most economics "schools" start from a standard Smithian narrative for the invention of money. Spot traded goods, durable goods as values stores and eventually some sort of money. The money supply narrative is completely separate. It's explained via the "money multiplier" effect, which turn…

Yeah, the biggest value in the the "history of debt" is the unlearning and debunking myths that are taught as 'science' in economics schools. There were no 'barter' economies, money did not 'evolve' from barter etc. Even otherwise respectable names in economics built their theories on top of these ideas which are in fact pure, convenient fantasy.

Re: Shelling Out: The Origins of Money (2002)

#12

Post by novalis78 »

dalbasal wrote: post #10
Wildgoose wrote: post #4

I highly recommend that people read "Debt: The First 5,000 years" by David Graeber which is a fascinating and erudite exploration of the development of money.

I've made that recommendation, with mixed results. I think it has less impact unless you studied/read a little classic economics. Most economics "schools" start from a standard Smithian narrative for the invention of money. Spot traded goods, durable goods as values stores and eventually some sort of money. The money supply narrative is completely separate. It's explained via the "money multiplier" effect, which turn…

I would also suggest 'The origin of virtue' which has a chapter on money and explains a similar idea based on evolutionary psychology (game theory, altruism, social behavior of apes) - quite fascinating as it connects social narratives with genetic strategies to better replicate.

Re: Shelling Out: The Origins of Money (2002)

#13

Post by CryptoPunk »

nosuchthing wrote: post #5

The author of the main article is Nick Szabo, who some theorize as the most likely candidate for being Satoshi Nakamoto. Szabo developed an early cryptocurrency called Bit Gold, which was never implemented, but has been called "a direct precursor to the Bitcoin architecture.". https://en.wikipedia.org/wiki/Nick_Szabo Was there a reason this comment was flagged? It seemed very relevant given the topic and recent trend…

>>It's essentially a penny stock deception, where the early users who generated the coins for low cost, or free, control the majority of the supply to manipulate the market spot price and than launch marketing campaigns and propaganda in an attempt to convince the uninformed public to buy their software coins.

While I welcome a debate on the public welfare effects of cryptocurrencies vs fiat, and disagree with your broad brushing of it as a "deception", this is really off-topic.

Re: Shelling Out: The Origins of Money (2002)

#14

Post by CryptoPunk »

jsykfyi wrote: post #9
jokoon wrote: post #7

I'm still curious about what are alternatives to using money. Surely there might be politics and some philosophy involved about how you manage and organize society. Aren't local currencies a part of the solution? Money is great because it lets individuals manage their own selves, but I'm still a little worried about how fraud, abuse and mismanagement can wreak havoc in society when money is abused. Regulating money a…

The same problem exists, regardless if its a fiat central bank or open source decentralized software token system: how is the money distributed and created? https://en.wikipedia.org/wiki/Wildcat_banking https://en.wikipedia.org/wiki/Private_currency https://en.wikipedia.org/wiki/Liberty_Reserve Even given the Cryptocurrency ecosystem, there's threats of fraud like Tether (theory: https://hackernoon.com/the-curious-ta…

>>or the inherent history and math behind Bitcoin and many proof of work cryptocurrencies distributing the supply to only a small group of users and cutting off the ease of producing more coins as easily to later users who use the software.

Keep in mind that the value of money derives from the net utility it provides in all of the trades it is used in throughout its lifetime. By implication, the only scenario where a new currency would displace old ones through market mechanisms like competition (as opposed to political ones like state mandates) is one where the value added by swapping out the old money with the new one in trades exceeds the cost for the economy to purchase the new money from those that minted it.

In other words, it's a net gain for society for a new money to displace the old one through market competition, regardless of the initial distribution of the new money.

The effect of the initial distribution on long-standing wealth distribution also diminishes over time, given a particular holding of currency can only be spent once. For long-run wealth distribution, what matters most is avenues to extract economic rent on a recurring basis, like regulatory capture, political privileges, etc, and new forms of money like cryptocurrency could alleviate these.

Re: Shelling Out: The Origins of Money (2002)

#16

Post by ThomPete »

Best book I have read on money is "The End of Alchemy: Money, Banking, and the Future of the Global Economy" by Mervyn King (former CEO of Bank of England)

He has a real knack for putting everything into context and explores the sub-prime crisis without pointing fingers.

Highly informative.

Re: Shelling Out: The Origins of Money (2002)

#17

Post by frabbit »

dalbasal wrote: post #10
Wildgoose wrote: post #4

I highly recommend that people read "Debt: The First 5,000 years" by David Graeber which is a fascinating and erudite exploration of the development of money.

I've made that recommendation, with mixed results. I think it has less impact unless you studied/read a little classic economics. Most economics "schools" start from a standard Smithian narrative for the invention of money. Spot traded goods, durable goods as values stores and eventually some sort of money. The money supply narrative is completely separate. It's explained via the "money multiplier" effect, which turn…

"I think it has less impact unless you studied/read a little classic economics."

I suspect that most people would repeat the claim that the chain of events was barter leading to coinage of some sort. Debunking that on its own is interesting.

Other interesting ideas are: * that in order to manage debt there needs to be (as there was historically) regular corrections to whatever debt system is in operation (the jubilee being his historical example). * once debt is quantized and mensurable the emotional, social origins of debt are destroyed

Regardless of the validity of his thesis I found the comparitive anthropology, history and literature interesting.

I find your last statement confusing. It seems to suggest simultaneously that there might be an average reader who is educated in mainstream ideas and will find the book revolutionary, and also average readers who are undeducated and will not find it revolutionary and finally anarchists (which is what Graeber is) who will also find it revolutionary.

I did not like the writing style, but I thought the content highly stimulating. It is definitely worth a read.

Re: Shelling Out: The Origins of Money (2002)

#18

Post by dalbasal »

frabbit wrote: post #17
dalbasal wrote: post #10

Earlier quoted context omitted.

I've made that recommendation, with mixed results. I think it has less impact unless you studied/read a little classic economics. Most economics "schools" start from a standard Smithian narrative for the invention of money. Spot traded goods, durable goods as values stores and eventually some sort of money. The money supply narrative is completely separate. It's explained via the "money multiplier" effect, which turn…

"I think it has less impact unless you studied/read a little classic economics." I suspect that most people would repeat the claim that the chain of events was barter leading to coinage of some sort. Debunking that on its own is interesting. Other interesting ideas are: * that in order to manage debt there needs to be (as there was historically) regular corrections to whatever debt system is in operation (the jubilee…

Revolutionary as in the "different from conventional" rather than "en route to revolution." I guess my choice of words was poor for this case. :)

It's not just educated, but also interested. For two reasons.. the first is that a nuanced change to the origin of money narrative is not really interesting in itself, without the context.

2nd, because the really interesting implications (imo) come from merging the barter and debt narratives. He doesn't get into it very explicitly.

A lot of modern economics (eg much of Friedman's work) orbits the money multiplication concept.

(1)Savers deposit money. (2)Banks lend the money. (3) borrowers buy a house with it. (4/1)The money gets redoposited by by the seller (5/2) banks lend the money....

Each time they lend the money, the total amount of money in existence (in people's bank account) multiplies. This process controls the supply of money, and its inflation implications. It's how (most) money gets created. It relates to banking stability. Business cycles. Stimulus. A lot of the complicated implications of money stem from here.

Graebers story is more elegant, with a single mechanism. It's all debt. The banking money multiplier predates money, and is the real way money came to be.

I immediately thought of bitcoin. My current thinking is that bitcoin will be real money when people start borrowing it, not when they start buying stuff with it. Or else, maybe bitcoin is not really significant since it's just a way of denominating money.

Anarchists will be interested for the anthropology, the history of debt rebellions and such. Not a lot of anarchists out there, so I assume modern writing from anarchist perspectives is generally interesting to them.

Re: Shelling Out: The Origins of Money (2002)

#19

Post by 45h34jh53k4j »

CryptoPunk wrote: post #15

How poetic that the author invented some of the key concepts behind Bitcoin and Ethereum (a proof of work based blockchain, the smart contract, etc) which introduced a new paradigm for money, and could potentially change how humans trade into the future.

Poetic, or maybe he is the real Satoshi :-)
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