Re: two currencies and Korean war

[Warren Mosler <mosler@xxxxxxxx>]

"J. Barkley Rosser, Jr." wrote:

> Ted,
>      I fully agree that the origins of media of
> exchange (aka "money") are in such things
> as bride price and religious ritual, etc.  It is
> also clearly the case that such elements still
> are important in various parts of the world,
> including parts of the Middle East.
>      We are back to the problem that this is
> being treated as a definitional matter by the
> chartalists.  If something is used to pay taxes,
> it is money.  If it is not used to pay taxes, then
> it is not money, no matter how widely it is used
> as a medium of exchange.  I debated this matter
> a number of years ago on this list, with cowrie
> shells being the prime example.

Bark,

I never used this stuff to define 'money.'

I stick with Paul Davidson's definition of 'money,' which I can
never quite remember, so I generally don't use the word.
In fact, I suggest the m word is best left out of most serious
economic discussion.

w

>
> Barkley Rosser
> ----- Original Message -----
> From: "Ted Winslow" <egwinslow@xxxxxxxxxx>
> To: <pkt@xxxxxxxxxxxxxxxx>
> Sent: Sunday, January 13, 2002 11:40 AM
> Subject: Re: two currencies and Korean war
>
> > Barkley wrote:
> >
> > > BTW, I have been aware of this personally.  As
> > > recently as 20 years ago, M-T dollars were still being
> > > used by bedouins in the desert of Sa'udi Arabia as a
> > > medium of exchange.  The Badu were very aware at
> > > all times of the world price of silver.
> > > OTOH, one for
> > > the chartalists, I suspect they were usable to pay taxes
> > > there as the Sa'udis were very into silver and some of
> > > them would lose huge sums when the silver bubble
> > > burst.  The Qur'an asserts that money should be specie
> > > and the Sa'udi paper money has silver threads in it.
> > > The Hunt brothers had convinced some of them that
> > > the world would go on a silver standard.  The current
> > > de facto leader, Crown Prince Abdullah reputedly lost
> > > several billion dollars in the crash.
> >
> > These facts contradict "chartalism" in the sense of the claim that the
> value
> > of money as a store of wealth derives ultimately from the tax requirement,
> > don't they?  The valuation of silver by the Sa'udis and the bedouins
> didn't
> > derive from its use for paying taxes, rather this use derived from its
> > valuation which, as the connection with the Qur'an indicates, had another
> > basis.
> >
> > My understanding is that blood feuds, jus talionis, blood money and bride
> > price are still characteristic of many Middle Eastern cultures. As I
> pointed
> > out earlier, in the psychology consistent with the psychological premises
> of
> > Keynes's monetary theory these phenomena are expressions of the same
> > persecutory anxiety as the "strong irrational feelings" about money to
> which
> > Keynes points as the ultimate basis of the "desire to hold money as a
> store
> > of wealth".
> >
> > Ted
> >
> >

--
Warren Mosler
Director of Economic Analysis
III Finance

http://www.mosler.org