A developing Goldman-Sachs scandal? | 49 comments (49 topical, 0 editorial, 0 hidden)

Re: A developing Goldman-Sachs scandal? (none / 1)

Your definition of "market" is not one that appears in any economic school of thought that I am aware of. (Discounting the Austrians, who make a point of claiming that every private enterprise operates on a competitive market. Because in theory another enterprise could start up and challenge them, so they have to behave as if they were actually competing. Yes, the Austrians are insane, that's why I'm discounting them.)
Fiat currencies are backed by real value: The control of the economic production by the state, and the ability to leverage said control into taxes. The easiest way to realise that there is something substantial backing fiat money is to look at a country in which there is nothing substantial backing the fiat currency, whether because the state is too weak to effectively tax the economy (think a dollarised flag of convenience country) or because the local economy has ceased to exist (think Zimbabwe).

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Jul 15th, 2009 at 02:19:33 AM EST
[ Parent ]

Re: A developing Goldman-Sachs scandal? (none / 1)

1/ A market is defined by the transactions entered into.

So the electricity market consists of the sum of all electricity transactions.

These may be one to one (Peer to Peer): one to many; many to many and so on.

In the electricity "market" there are "sub-markets": including a wholesale market (entered into on specific wholesalemarket terms) and a pretty fragmented retail market. There is competition (sometimes) between wholesale distributors, and retail customers may buy at an agreed price from distributors for an agreed period.

There is typically no homogeneous "market price". Whatever the price a buyer has agreed for his physical supply, he would - if the supplier is a member of the Pool I propose - be able to pay in fiat currency, in Units, or in anything else acceptable to the seller. (eg Tesco Points).

2/ Fiat currencies are backed by the power of the State to collect taxes.

The State is one of a chain of credit intermediaries, and like all intermediaries, redundant. The State as a facilitator and service provider is another issue.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Wed Jul 15th, 2009 at 04:52:22 AM EST
[ Parent ]

A developing Goldman-Sachs scandal? | 49 comments (49 topical, 0 editorial, 0 hidden)

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