Re: Is Money Credit?

["W. Curtiss Priest" <bmslib@xxxxxxx>]

Gunnar Tomasson wrote:
>
> Curtiss:
...
> the "supply" of New Money is NOT constrained by the Factor Cost, which is
> ZERO.

Thus the reason that Griffin in "The Creature from Jekyll Island"
argues the main advantage to pegging money to gold, is precisely
because it's factor costs are NOT zero.

The human labor, machinery, energy, etc. as inputs just about
break even at $200-$300 per ounce as the price of gold has
hovered in the $280 to $300+ range for a while.

As Griffin skillfully describes when it costs nothing to
make new money (fiat money), there is a strong temptation to
devise ways of getting more, especially if you are the federal
government and are somewhere between $6-$44 trillion in debt,
and you've got obligations backing a debt-ridden country
from home mortgages to $100,000 savings accounts.

And every country that succumbs to printing its way out of
debt, devestates the very economy that it needs to pay
taxes.

Regards,

Curtiss
--


	   W. Curtiss Priest, Director, CITS
   Research Affiliate, Comparative Media Studies, MIT
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