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The easy way out

The easy way out

Posted Nov 6, 2012 15:36 UTC (Tue) by njs (guest, #40338)
In reply to: The easy way out by khim
Parent article: Let’s Limit the Effect of Software Patents, Since We Can’t Eliminate Them (Wired)

The "numbers on some computer" mentioned above have nothing to do with the debate about fiat versus commodity money. Even if you have a gold-backed currency, the vast majority of the money going around will still just be "numbers on some computer" unless you also eliminate fractional reserve banking. (It'd be interesting to see the "google ron paul!" crowd take this up as a rallying cry. Down with checking accounts!)

It does seem odd that you can be so certain you understand how money ought to work without even being familiar with the concept of money supply.

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The easy way out

Posted Nov 6, 2012 17:03 UTC (Tue) by nix (subscriber, #2304) [Link]

Quite. If you want a truly stable money supply you have to eliminate not just checking/current accounts, but savings accounts too (M2), and also money market funds (M3), and go on to ban *everything* potentially substitutable for money. I'm not sure you'd have an economy left after you did that. And if you don't do that, keeping the monetary base fixed has no effect on the economy as a whole other than to annoy everyone.

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