The greed you pointed out is an observation describing the behavior going on. It is not the source, but rather a symptom brought about by legal tender laws and a fiat monetary system. Saying the issue is greed is like saying, "That guy over there is stuffing his face like a pig because he's fat."
No, there is an issuer of currency that a select few have access to. As a result, they can introduce new money into the system, thus gaining a market advantage.
There is a finite amount of resources/goods in play at any given time in an economy. When you have a fiat monetary system in place like we do now, then you have an infinite amount of substitute money that can be introduced into the economy. However, the price of the goods will reflect this introduction of new money -- i.e. as the money supply increases, then the prices will rise over time because the currency is being debased. But, these price corrections are not immediate, they happen subsequently. Thus, those who receive the new money first have all the market advantages, and as a result are essentially purchasing things at a discounted rate. If you buy at the discounted rate, and then sell at the higher rate once the market corrected due to this influx of demand, you make a "profit." Though, it's illusory because it's just money manipulations.
The end result is that wealth gets consolidated into the hands of a select few, into the hands of those who get the new money first.
So, while one group has this line of credit, there is another group that is engaging the market and working for the money. The latter is operating within the money already in play rather than having access to the line of credit. And if their income is not increasing, then the value of their earnings is being debased.
Minimum wage policies, for example, are an attempt to rectify this side effect of the current monetary system. However, when you create a price change like this, regardless of it being wages or whatever, you essentially impose the neutrality of money theory on the market at that very instance. It's an immediate shock to the entire economy. It would be analogous to an electrical surge -- not one that everyone can withstand. Those that can have gained a market advantage.
So, at the top, the people getting the line of credit are violating the principle of equal consideration bu essentially getting something for nothing. At first, this is re-balanced at the bottom with those receiving a static income, e.g. a wage. When the government steps in to increase wages to rectify this issue, then that imbalance is passed onto the middle class, especially small businesses, but even large ones that a gargantuan amount of employees. So, an alternative to this is provide social benefits, e.g. food stamps.
All of this is occurring because there is no natural check and balance to the Cantillon Effect. If gold for example was money, then people would have to go mine and mint coins which requires real effort rather than just entering virtual numbers in a computer like we do in the current monetary system. I hope that clears it up somewhat.
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timeasmymeasure
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Date: 2013-08-15 06:19 pm (UTC)No, there is an issuer of currency that a select few have access to. As a result, they can introduce new money into the system, thus gaining a market advantage.
There is a finite amount of resources/goods in play at any given time in an economy. When you have a fiat monetary system in place like we do now, then you have an infinite amount of substitute money that can be introduced into the economy. However, the price of the goods will reflect this introduction of new money -- i.e. as the money supply increases, then the prices will rise over time because the currency is being debased. But, these price corrections are not immediate, they happen subsequently. Thus, those who receive the new money first have all the market advantages, and as a result are essentially purchasing things at a discounted rate. If you buy at the discounted rate, and then sell at the higher rate once the market corrected due to this influx of demand, you make a "profit." Though, it's illusory because it's just money manipulations.
The end result is that wealth gets consolidated into the hands of a select few, into the hands of those who get the new money first.
So, while one group has this line of credit, there is another group that is engaging the market and working for the money. The latter is operating within the money already in play rather than having access to the line of credit. And if their income is not increasing, then the value of their earnings is being debased.
Minimum wage policies, for example, are an attempt to rectify this side effect of the current monetary system. However, when you create a price change like this, regardless of it being wages or whatever, you essentially impose the neutrality of money theory on the market at that very instance. It's an immediate shock to the entire economy. It would be analogous to an electrical surge -- not one that everyone can withstand. Those that can have gained a market advantage.
So, at the top, the people getting the line of credit are violating the principle of equal consideration bu essentially getting something for nothing. At first, this is re-balanced at the bottom with those receiving a static income, e.g. a wage. When the government steps in to increase wages to rectify this issue, then that imbalance is passed onto the middle class, especially small businesses, but even large ones that a gargantuan amount of employees. So, an alternative to this is provide social benefits, e.g. food stamps.
All of this is occurring because there is no natural check and balance to the Cantillon Effect. If gold for example was money, then people would have to go mine and mint coins which requires real effort rather than just entering virtual numbers in a computer like we do in the current monetary system. I hope that clears it up somewhat.