Re: two currencies and Korean war

["Harry Veeder" <eo200@xxxxxxxxxxxxxxxxxxx>]

"J. Barkley Rosser, Jr." wrote:

>Harry,
>      Why is this?  Taxes are generally just some
>percentage of something anyway, sales prices
>or income.  So, why would taxes provide more
>substance to price information?

Traditionally it is assumed that the nature of price
is the same in both a non-monetary (real exchange) economy
and a monetary economy . However, I believe the crucial difference
between the two economies is in the nature of price not in the
presence of money. Taxation alters the nature of price
and the penetration of state money is evidence of this change.

In a monetary economy price only denotes of value instead
of also connoting value. Or to put it another way, the symbolic/affective
information content of price is squeezed out by the tax system
leaving behind pure quantitative information. Such 'hard data'
is essential for investment planning. The harder the price information
the more successful investment will be.

Harry Veeder

>      Things get used as media of exchange
>("money" in most peoples' books) because other
>people believe that other people will accept them
>in payment for things.  How they get to be accepted
>is ultimately rather arbitrary.  Sometimes, most of
>the time in our modern fiat money economy, it is
>assertions by governments (generally accompanied
>by payment of taxes) that determines this acceptability.
>But, we have now seen a bunch of examples of things
>from war scrip in Korea (that could not be used for
>paying taxes in the US or Korea), to Maria Theresa silver
>dollars in the eastern Med 100 years ago, to cowrie
>shells, that have been media of exchange without any
>backing by governments or payment of taxes foundation.
>As noted in cases such as tobacco receipts in colonial
>Virginia, sometimes the ability to pay taxes has FOLLOWED
>the emergence of this general acceptability.
>Barkley Rosser
>----- Original Message -----
>From: "Harry Veeder" <eo200@xxxxxxxxxxxxxxxxxxx>
>To: <pkt@xxxxxxxxxxxxxxxx>
>Sent: Saturday, January 12, 2002 7:09 AM
>Subject: Re: two currencies and Korean war
>
>
>>
>> ----------
>> >From: "John O'Donnell" <jackodonnell@xxxxxxxx>
>> >To: "J. Barkley Rosser, Jr." <rosserjb@xxxxxxx>
>> >Subject: Re: two currencies and Korean war
>> >Date: Sat, Jan 12, 2002, 12:33 AM
>> >
>>
>> >
>> >>
>> >>      Well, there really are all kinds of examples
>> >> of monies issued by states that end up getting
>> >> used in other places and even long after the
>> >> original issuer has stopped doing so.  One of
>> >> my favorites are Maria Theresa silver dollars,
>> >> originally issued by the Austro-Hungarian
>> >> empire in the 1770s when Maria Theresa was
>> >> the empress.  Of course these were perfectly
>> >> good chartalist money, accepted by the Hapsburgs
>> >> for paying taxes, etc.
>> >
>> >Does it need saying that payment of taxes is not necessary
>> >to give value to substance used in standardized barter?
>>
>>
>> Taxes are necessary to affix _real number_ values to substance.
>> Without taxation, price information is too fuzzy for investment
>> decisions.
>>
>> Harry Veeder
>>
>>
>>
>>
>