4 ms·

The point is that while you can spend a lot of money you can't spend infinite money. There's a finite pile of euros. Every euro you spend on something stupid

The point is that while you can spend a lot of money you can't spend infinite money. There's a finite pile of euros. Every euro you spend on something stupid is one less euro you can spend on something smart.

cygx 7y ago
Money is a tool of social organization that lacks instrinsic value. Any time we as a society refuse to do something worthwhile for the sole reason that it would cost too much, that's a capitulation to human stupidity and/or greed.
- ehaliewicz2 7y ago
  It's not so much about money, the implication is that making solar panels costs some amount of resources that according to the parent, could possibly be spent in better ways. The money just represents, indirectly, the amount of resources.
  - cygx 7y ago
    The question is, what's the limiting factor: Availability of manpower, natural resources, etc, or 'merely' the money to pay for them? The latter is an artificial constraint. Take nuclear fusion as an example: Supposedly, this is a case where the projected investments necessary to go from theory to practice just haven't been made. With return of investment only anticipated in the far-off future, it was decided that the money could be spent in better ways.
    - ehaliewicz2 7y ago
      Obviously money again is only representing some value or resource. You have to compensate workers or else they won't do any work (unless you plan on enslaving them, or have the government provide for all their needs).
- sonnyblarney 7y ago
  The value of money is not artificial, it's valued through a measurement of it's availability vis-a-vis other resources and opportunities. Surely countries can invest more if those projects are 'more value creating than other investments' and if it's rational, but the notion that countries shouldn't be afraid of debt either is pragmatically no helpful. All of us are just a few irresponsible financial decisions away from being Greece, Venezuela, Weimar etc.. Stable fiat currencies are a precarious thing, which why we are so cold and 'small c' conservative about it. As for Germany's problems, it has to do with how we measure value, institutional legacy, and obviously unwillingness to consider Nuclear. Merkel was never really a pragmatist in the sense we would understand it - she was a political pragmatist, meaning really just 'populist' but more of the centrist type: I believe her Nuclear decision was mostly political.
  - cygx 7y ago
    Of course it's artificial. However, that doesn't mean it's arbitrary, or useless, or can be ignored at will given the current system of socio-economic organization. You're absolutely right that in the world we live in, policy makers have to be careful about financial decisions, or suffer the consequences. But I believe people should be reminded from time to time that our world is pretty far from the best possible one: There's no particularly good reason that a child has to die from undernutrition every couple of minutes, that fusion research stagnated due to lack of funding, that people go bankrupt to pay for healthcare, etc. As a species, we're just too stupid and greedy to do any better...
EastLondonCoder 7y ago
The only "currency" I know with a finite money supply is bitcoin. I may be misunderstanding you but there certainly isn't a fixed pile of Euro notes sitting in a vault under the European Central Bank. Money creation is essential to any macroeconomy, just look at the countries in Southern Europe. They have to deal with atrocious unemployment because they cant devalue. Germany and France certainly can. Sure runaway inflation is harmful, but in the choice of inflation in the high single digit contra 20-30% unemployment, my choice would be to lower unemployment. If your case is that economic output is fixed I would flat out disagree. It's been shown over and over again that investment increases economic output. Which was very much the idea with Germany's Energiewende
- adventured 7y ago
  There's a strictly finite value base - assets, economic output, etc - to all fiat money supply. It's the underlying value, things priced and transacted in the fiat currency, that make it valuable. You can easily spook the confidence in fiat by doing stupid things to an economy. Otherwise Venezuela would be the richest country in world history right about now, given their inflation rate. It works identical to mathematical halving in concept. Yes you can keep going, and no you'll never reach zero. However every time you debase the currency to pay for something beyond your budget, you destroy some of the value underpinning it. You make the assets and transactions in that currency less valuable. You can infinitely subdivide the currency, and each time you do it, you destroy more of the value base. Eventually you're splitting pennies, so to speak. This is especially true in cases where you're printing to pay for something you can't afford (almost always the reason for such printing), so what you're really doing is eating the nation's asset base through the currency debasement. Just ask Japan, they sliced more than 1/3 off their standard of living by debasing the Yen over the past decade. They had no choice due to their debt situation (they needed to stealth default), however it reduces the value of the assets that are held in Yen, making it easier to eg use dollars (or gold) to buy those assets (whether businesses or real-estate and so on). So sure, in theory can you infinitely print currency. In practical application, you destroy the value of the things that underpin the currency and the whole scheme self-destructs given enough time and 'printing.' That puts a more realistic cap on actual potential money supply. The fact is, it inherently must be finite. Eventually your money is not worth anything, as you destroy the assets under it. As that happens, people stop accepting the worthless currency, it becomes too expensive to 'print' it and support it, and it becomes a self correcting system, in all cases and without exception.

cygx 7y ago

Money is a tool of social organization that lacks instrinsic value. Any time we as a society refuse to do something worthwhile for the sole reason that it would cost too much, that's a capitulation to human stupidity and/or greed.

ehaliewicz2 7y ago
It's not so much about money, the implication is that making solar panels costs some amount of resources that according to the parent, could possibly be spent in better ways. The money just represents, indirectly, the amount of resources.
- cygx 7y ago
  The question is, what's the limiting factor: Availability of manpower, natural resources, etc, or 'merely' the money to pay for them? The latter is an artificial constraint. Take nuclear fusion as an example: Supposedly, this is a case where the projected investments necessary to go from theory to practice just haven't been made. With return of investment only anticipated in the far-off future, it was decided that the money could be spent in better ways.
  - ehaliewicz2 7y ago
    Obviously money again is only representing some value or resource. You have to compensate workers or else they won't do any work (unless you plan on enslaving them, or have the government provide for all their needs).
sonnyblarney 7y ago
The value of money is not artificial, it's valued through a measurement of it's availability vis-a-vis other resources and opportunities. Surely countries can invest more if those projects are 'more value creating than other investments' and if it's rational, but the notion that countries shouldn't be afraid of debt either is pragmatically no helpful. All of us are just a few irresponsible financial decisions away from being Greece, Venezuela, Weimar etc.. Stable fiat currencies are a precarious thing, which why we are so cold and 'small c' conservative about it. As for Germany's problems, it has to do with how we measure value, institutional legacy, and obviously unwillingness to consider Nuclear. Merkel was never really a pragmatist in the sense we would understand it - she was a political pragmatist, meaning really just 'populist' but more of the centrist type: I believe her Nuclear decision was mostly political.
- cygx 7y ago
  Of course it's artificial. However, that doesn't mean it's arbitrary, or useless, or can be ignored at will given the current system of socio-economic organization. You're absolutely right that in the world we live in, policy makers have to be careful about financial decisions, or suffer the consequences. But I believe people should be reminded from time to time that our world is pretty far from the best possible one: There's no particularly good reason that a child has to die from undernutrition every couple of minutes, that fusion research stagnated due to lack of funding, that people go bankrupt to pay for healthcare, etc. As a species, we're just too stupid and greedy to do any better...

EastLondonCoder 7y ago

The only "currency" I know with a finite money supply is bitcoin. I may be misunderstanding you but there certainly isn't a fixed pile of Euro notes sitting in a vault under the European Central Bank. Money creation is essential to any macroeconomy, just look at the countries in Southern Europe. They have to deal with atrocious unemployment because they cant devalue. Germany and France certainly can. Sure runaway inflation is harmful, but in the choice of inflation in the high single digit contra 20-30% unemployment, my choice would be to lower unemployment. If your case is that economic output is fixed I would flat out disagree. It's been shown over and over again that investment increases economic output. Which was very much the idea with Germany's Energiewende

adventured 7y ago
There's a strictly finite value base - assets, economic output, etc - to all fiat money supply. It's the underlying value, things priced and transacted in the fiat currency, that make it valuable. You can easily spook the confidence in fiat by doing stupid things to an economy. Otherwise Venezuela would be the richest country in world history right about now, given their inflation rate. It works identical to mathematical halving in concept. Yes you can keep going, and no you'll never reach zero. However every time you debase the currency to pay for something beyond your budget, you destroy some of the value underpinning it. You make the assets and transactions in that currency less valuable. You can infinitely subdivide the currency, and each time you do it, you destroy more of the value base. Eventually you're splitting pennies, so to speak. This is especially true in cases where you're printing to pay for something you can't afford (almost always the reason for such printing), so what you're really doing is eating the nation's asset base through the currency debasement. Just ask Japan, they sliced more than 1/3 off their standard of living by debasing the Yen over the past decade. They had no choice due to their debt situation (they needed to stealth default), however it reduces the value of the assets that are held in Yen, making it easier to eg use dollars (or gold) to buy those assets (whether businesses or real-estate and so on). So sure, in theory can you infinitely print currency. In practical application, you destroy the value of the things that underpin the currency and the whole scheme self-destructs given enough time and 'printing.' That puts a more realistic cap on actual potential money supply. The fact is, it inherently must be finite. Eventually your money is not worth anything, as you destroy the assets under it. As that happens, people stop accepting the worthless currency, it becomes too expensive to 'print' it and support it, and it becomes a self correcting system, in all cases and without exception.