Discounting the future

[xxjs]

How can you loan from the future? A taxi owner can do that. By not setting aside money equivalent to the wear of his car, he can spend more than he earns. When the car is worn out, of course, he will have a surprise.

What about the world at large? I allege that it is not possible for the world to loan from the future. Consider this: First, remove the money from equation. You can do that, because money does not have direct use value, their function is only to facilitate trade. So whatever the world produces in one period of time, must either be consumed directly, or be saved as real capital. If the world in a period uses more than what is procuded, the excess must come from previously invested capital.

The effect of consuming more than is produced, is capital consumption and consequently reduced productivity in the future. That is why fucking with the money, fucking with the prices and fucking the interest rate is always the wrong thing to do.

[oleganza]

There is nothing "wrong" in playing with monetary bases. What's wrong is to force people to use *your* money under *your* rules without a good moral proof for the violence (so far no one who uses violence bothers to prove their morality). Everything else is okay with me.

If Krugman likes inflationary currency, he may use one. If you like deflationary currency, you choose yours. The problem arises when either you or Krugman starts proclaiming which one is "good for society". Then the guns are out and war begins.

[xxjs]

There is nothing "wrong" in playing with monetary bases. What's wrong is to force people to use *your* money under *your* rules without a good moral proof for the violence (so far no one who uses violence bothers to prove their morality). Everything else is okay with me.

If Krugman likes inflationary currency, he may use one. If you like deflationary currency, you choose yours. The problem arises when either you or Krugman starts proclaiming which one is "good for society". Then the guns are out and war begins.

I agree, but there seems to be hurdles. Anybody can possibly mint gold coins nominated in troy oz or gram, but if someone wants to create private gold backed paper money, I think the regulators may make hell for you. Maybe they will be taxed with sales tax. We need a law explicitely stating that private money is legal, that they are tax excempt, that anyone can freely change any kind of money for any other, and unhampered import and export of money.