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Author Topic: Intrinsic Value  (Read 3112 times)
benjamindees
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October 13, 2012, 01:38:38 AM
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Most people will argue that intrinsic value does not exist.  I disagree.  I assert that this is an example of an object with intrinsic value:



Why do I say this?  What is intrinsic value?  I assert that intrinsic value is a measure of the ability of an object (or a system) to prevent or mitigate entropic loss.  The system pictured, consisting of a solar photovoltaic collector, a battery, and an inverter/controller, is capable of storing solar energy for future use.  This is, in effect, mitigating the loss of energy freed by the uncontrolled nuclear reactions of the Sun.  It could even, on a large enough scale, be capable of reversing those reactions.

So this system carries energy, and thus value, forward through time.  This is the hallmark of intrinsic value.  It is a feature of all objects with intrinsic value, including money.

Intrinsic value is not dependent upon humans.  It is not a product of your imagination, of your wishes or preferences.  Any creature, animals, plants or even extraterrestrials, is capable of benefiting from the mitigation of entropic loss, and the future energy, provided by such a system.  Intrinsic value is an absolute, objective standard.

The quality of intrinsic value is, however, still relative to the environment in which the object or system exists.  It is not permanent.  Solar panels do not last forever.  It is dependent upon location.  Solar panels are relatively less valuable in deep space.  And they will become less valuable if, for instance, the nearest star burns out.  A solar panel that requires more energy to produce than it can collect in its lifetime does not necessarily exhibit intrinsic value.

Intrinsic value can take on many forms, from hydroelectric dams, to greenhouses, to more complex systems like airplanes or even cities.  This, however, is not a form of intrinsic value:


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October 13, 2012, 07:38:53 AM
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Value is subjective, therefore there can be no intrinsic value. I value entropic loss, it entertains me.
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October 13, 2012, 07:46:15 AM
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Entropy exists, but try to have a conversation with an entropic system about value. It won't have much to say because value is a human idea.

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October 13, 2012, 07:58:56 AM
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If people want it, it has value, and the reason people want it can be many

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October 13, 2012, 12:50:09 PM
 #5

What is intrinsic value?  I assert that...

I disagree with your assertion. What now?

Can you see how we are always stuck with this?:

Value is subjective, therefore there can be no intrinsic value.

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October 13, 2012, 05:45:52 PM
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Intrinsic value is cost of production

Gold has an intrinsic value of about $600 and silver $7 because that is how much it costs to produce.

Once prices fall below production cost they stop being produced and supply shortages push up the price.

Same with bitcoins, if the value drops below (the cost of electricity per hour x hours to mine a coin), we would not produce them.

This is why we do not mine gold and silver in the west anymore. It didn't run out (a some silver coin dealers want you to believe) it just wasn't economical anymore!
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October 13, 2012, 05:54:17 PM
 #7

Intrinsic value is not dependent upon humans.  It is not a product of your imagination, of your wishes or preferences.  Any creature, animals, plants or even extraterrestrials, is capable of benefiting from the mitigation of entropic loss, and the future energy, provided by such a system.  Intrinsic value is an absolute, objective standard.
It's possible to define value this way, but it's not a very useful way of doing so.

If you use an objective standard to define something as valuable, but no other human wants or needs the thing, then how practical is this definition of "value"? Maybe you can get other people to agree with you that your thing satisfies the arbitrary criteria of your objective standard, but if they neither want nor need it the market price of your "intrinsically valuable" object will be zero or negative.

What purpose does a definition of "value" serve if it's disconnected from the wants and needs of humans? If value isn't defined relative to utility then it's just mental masturbation with no connection to the real world.
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October 13, 2012, 09:19:19 PM
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Intrinsic value is cost of production
Gold has an intrinsic value of about $600 and silver $7 because that is how much it costs to produce.
Once prices fall below production cost they stop being produced and supply shortages push up the price.
Same with bitcoins, if the value drops below (the cost of electricity per hour x hours to mine a coin), we would not produce them.
This is why we do not mine gold and silver in the west anymore. It didn't run out (a some silver coin dealers want you to believe) it just wasn't economical anymore!
Your argument is flawed. Your conclusion "value is the result of production" is the converse of your premise: "production is the result of value". I don't think it could be any more circular.

But to address your claim directly: You are arguing that the value of gold can't drop below the cost of production because production would stop. Although the value of gold determines the amount of production, there is nothing about the production of gold that determines its value. What would happen if all the gold in the world were mined? There would no longer be any production. Does that mean that the value of gold would become infinite, or 0?

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October 13, 2012, 10:02:10 PM
 #9


Same with bitcoins, if the value drops below (the cost of electricity per hour x hours to mine a coin), we would not produce them.


There is some truth here, last year when the BTC price dropped to a level that even the most efficient GPU can not make profit with normal electricity cost, many miners shut down their machine

And then, the total network hashing power got lower, the difficulty also got lower, this increased the profitability for those miners who stayed, so that they got better payout

And then, after several months the BTC price rised sharply again, those who quit the mining at that time start to regret their decision, they realized that loss in past can be covered by profit in future




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October 14, 2012, 02:26:22 AM
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Just wanted to come out of lurking long enough to say:
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October 17, 2012, 05:03:02 PM
 #11





Discounting that I don't agree with your definition of intrinsic value, you have to take into account all the entropy that went into constructing that thing and that which will be needed to maintain it. Thus your supposed value must be amortized over a period of time.

I'll also note that your definition of intrinsic value would include a ledge on the side of a hill where rocks that roll down might sit a while before the wind knocks them off to continue on their way.

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October 17, 2012, 05:07:21 PM
 #12

Intrinsic value is cost of production

Gold has an intrinsic value of about $600 and silver $7 because that is how much it costs to produce.

How do you reach that cost of production? Isn't man/machine labor value also subjective?

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October 17, 2012, 10:15:19 PM
 #13

Years ago, I had a similar idea: If something has energy inside, then it has value, the amount of value depends on the energy it contained. That was an effort to identify the value through a scientific way, to get rid of personal bias

But in later days, I realized that people are emotional, and that emotion will change the perceived value. For example famous painting contains very small amount of engergy, but it still can be sold for millions, because of its scarcity

So basically, supply and demand together are enough to decide the value

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October 17, 2012, 10:47:05 PM
 #14

If something has energy inside, then it has value

You do know everything is energy right?  Cheesy E = mc2..

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October 18, 2012, 01:45:20 AM
 #15

So basically, supply and demand together are enough to decide the value

...a value. An object's value depends on how you measure it.  The lack of a definitive method of measuring value that is consistent and relevant for every object is why I don't think there is such s thing as "intrinsic" value.

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October 18, 2012, 03:31:33 PM
 #16

Most people will argue that intrinsic value does not exist.  I disagree.  I assert that this is an example of an object with intrinsic value:



Why do I say this?  What is intrinsic value?  I assert that intrinsic value is a measure of the ability of an object (or a system) to prevent or mitigate entropic loss.  The system pictured, consisting of a solar photovoltaic collector, a battery, and an inverter/controller, is capable of storing solar energy for future use.  This is, in effect, mitigating the loss of energy freed by the uncontrolled nuclear reactions of the Sun.  It could even, on a large enough scale, be capable of reversing those reactions.

So this system carries energy, and thus value, forward through time.  This is the hallmark of intrinsic value.  It is a feature of all objects with intrinsic value, including money.

Intrinsic value is not dependent upon humans.  It is not a product of your imagination, of your wishes or preferences.  Any creature, animals, plants or even extraterrestrials, is capable of benefiting from the mitigation of entropic loss, and the future energy, provided by such a system.  Intrinsic value is an absolute, objective standard.

The quality of intrinsic value is, however, still relative to the environment in which the object or system exists.  It is not permanent.  Solar panels do not last forever.  It is dependent upon location.  Solar panels are relatively less valuable in deep space.  And they will become less valuable if, for instance, the nearest star burns out.  A solar panel that requires more energy to produce than it can collect in its lifetime does not necessarily exhibit intrinsic value.

Intrinsic value can take on many forms, from hydroelectric dams, to greenhouses, to more complex systems like airplanes or even cities.  This, however, is not a form of intrinsic value:



Aah, so a stable atom will have super uber extra intrinsic value because it carries an incredible amount of energy?
I don't think that the world sees it quite like this altho i do think that entropy should be valued more as everything runs on it.
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October 18, 2012, 03:57:23 PM
 #17

The lack of a definitive method of measuring value that is consistent and relevant for every object is why I don't think there is such s thing as "intrinsic" value.
If an object has intrinsic value then, based on the definition of the word "intrinsic", that value can't depend on any factor besides the object itself. Most importantly, it can't depend on trade.

An object with intrinsic value would still posses that value if you were the only human left on the planet (no one around to trade with).

What kinds of things have that property? Food and water come to mind. Medicine, clothing, stored energy - anything an individual can use directly to sustain life and comfort.
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October 18, 2012, 04:22:41 PM
 #18


What kinds of things have that property? Food and water come to mind. Medicine, clothing, stored energy - anything an individual can use directly to sustain life and comfort.

Even that is not completely clear. What is this "intrinsic value" of a peanut butter sandwich and milk to someone who is lactose intolerant and has wheat and nut allergies?

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October 18, 2012, 04:23:11 PM
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The lack of a definitive method of measuring value that is consistent and relevant for every object is why I don't think there is such s thing as "intrinsic" value.
If an object has intrinsic value then, based on the definition of the word "intrinsic", that value can't depend on any factor besides the object itself. Most importantly, it can't depend on trade.

An object with intrinsic value would still posses that value if you were the only human left on the planet (no one around to trade with).

What kinds of things have that property? Food and water come to mind. Medicine, clothing, stored energy - anything an individual can use directly to sustain life and comfort.

Things that are considered by humans.
The intrinsic value of gold is that it shines nicely.
But who else cares about this than humans?
Intrinsic value is simply the appreciation of a certain intrinsic property.
Any intrinsic property can be seen as intrinsic value by a human.
Value can only exist if something has been valued.
The reality of things is that they have many properties but not all of them are valued by humans.
Any random thing has more properties than is ever considered when deciding on an 'intrinsic value'.
Notice how the examples you mention are all completely human related.

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October 18, 2012, 11:45:19 PM
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Even that is not completely clear. What is this "intrinsic value" of a peanut butter sandwich and milk to someone who is lactose intolerant and has wheat and nut allergies?
If intrinsic value for food was measured in terms of calories that's a property that is constant regardless of any allergies or intolerances the eater might have, or for that matter what species is eating the food.

A person with a nut allergy might very well eat a peanut butter sandwich if the consequences of not injesting the calories were worse than the symptoms of their allergy.
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