#economics #money
"If money is a “measure of indebtedness”, who is indebted to who when gold coins are used as money?"
If you swap gold coins for goods and services, those coins aren't money in the modern sense. They are just valuable assets, just like the goods you can exchange them for. So post-transaction, nobody is indebted to anybody.
"The answer is “no one”. And the same goes for all commodity monies."
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Mark Wadsworth: Glad to have cleared that up.*/
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Friday, 14 November 2014
Glad to have cleared that up.
Ralph Musgrave in the comments to an earlier post:
<span>"If money is a “measure of indebtedness”, who is indebted to who when gold coins are used as money?"
If you swap gold coins for goods and services, those coins aren't money in the modern sense. They are just valuable assets, just like the goods you can exchange them for. So post-transaction, nobody is indebted to anybody.
"The answer is “no one”. And the same goes for all commodity monies."
Even back in the day when we used gold coins, the split second that any of the following occur, you have a debt-based money system:
a) You obtain (or supply) goods and services on credi Summary
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