Re: Starting Point

["Gary Santos" <evs@xxxxxxxxxxxx>]

In my continuing effort to appreciate the concept of "soft money", I have
trouble with that this taxation and fiat money link. If the private sector
continues to accumulate bonds (or, "net financial assets" as Warren like to
say) at the rate the two deficits are growing, it will come to the point
that the total value in bonds is worth some ridiculous number of decades
worth of taxes. Money's marginal value should drop as there will just be too
much of it. In all currencies in history, I dare say, time and debt
accumulation killed each of them one after the other. (At least, today we
are candid enough to rationalize that fiat's value is tied to its use as
tender for taxes. Warren, I am still reading the article you pointed me to.)


----- Original Message -----
From: "Henry C.K. Liu" <hliu@xxxxxxxxxxxxxx>
To: <pkt@xxxxxxxxxxxxxxxx>
Sent: Sunday, March 16, 2003 2:53 AM
Subject: Re: Starting Point


No, taxation is what give value to money.  More of it or less of it
depends on the size and direction of the economy, and nothing else. Only
if taxation is out of sync with the economy would it be a pain.  This is
true in both capitalism and socialism.

Henry C.K. Liu

Harry Veeder wrote:
>
>>From: Robert Williams <vic93@xxxxxxxxxxxx>
>
>
>>A more open definition other than "The economy" equals "A Market".
>>would let you see beyond the Classical dead endmarket = economy.
>>Polanyi considered taxation a part of the Transaction Mode
>>he named Redistribution.
>
>
> Yes. Taxation is like physical pain. Sometimes we desire more of it
> sometimes we desire less of it.
>
> Harry Veeder
>
>