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Money has no inherent value; it is just a currency, an indirection, a promise. The economy must always bottom out at a physical good or service. You can keep tr
by titzer 1y ago
Money has no inherent value; it is just a currency, an indirection, a promise. The economy must always bottom out at a physical good or service. You can keep trading promises of goods and services in various forms, but ultimately you end up with the inescapable tyranny of physical existence that is a closed system, with the one exception that we get energy from the Sun and stored forms of energy on this planet.
No wealth was created by "discovering value" or finding someone with money to buy something that was already there before. If this new person decided to spend $100 on a baseball card, then they didn't spend money on something else, so the market for those other things is naturally going to price them lower. So the $100 came from somewhere[1].
All of these open system chains of thought that assume any "non-zero sum game" either improperly account for devaluation of other goods or they assume accumulation of labor, and typically add a side helping of assumed exponential growth.
[1] Which is not say that money cannot be created from nothing. In fact, it is all the time. Debt--loans, stocks, bonds, IOUs--is money creation.