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TexasTowelie

(111,279 posts)
Mon Jun 16, 2014, 02:14 AM Jun 2014

The Metaphysics of Money

Recently I was at a coffee shop, and to test a metaphysical hunch I asked a few of my fellow caffeinated confreres this question: “What is money?” They all gave answers along the following lines. Money is an arbitrary symbol of exchange value that we just make up in order to facilitate trade and investment. Money itself isn’t any thing but it is a collectively believed in fiction which operates as a very useful means of exchange.

This sort of answer confirmed my hunch nicely: us Modern people have no idea how (or even if) money is connected to real wealth. It was Medieval economics that opened my eyes to this fascinating and possibly very important insight.

If you were to ask a medieval person the question “What is money?” they would not tell you that it is simply a made up means of marketplace exchange. They would not say anything like that for a number of interesting reasons. The first of these reasons is that they would assume a “what is… ?” question is a question about something’s essential nature rather than a question about its conventional function or instrumental effect. This assumption reflects a huge difference between Modern and Medieval reality outlooks to start with. To the Medievals, everything has an essential meaning, and accurately discerning true meaning determines right use. To us Moderns, it is the other way around: everything has a use – effective manipulative power, based on a scientific knowledge of how things work, is the criteria of real world truth – and each person can make up whatever meanings and values they like. Indeed, to us, nothing has an essential meaning. To us, use defines value, but value itself has no essential meaning.

Because they were interested in essential meanings the Medievals did not believe in a notion so relativistic and contingent as ‘classical’ supply and demand determined “market value”. Instead, they believed in “true value” where the true (essential) value of anything sold in the market needed to be reasonably reflected in the price if it was to be sold fairly. Here a fair price was seen as a function of properly appreciated real value (knowing what something was really worth). Fair price was a function of the essential value of the traded thing itself and the real value of the skills, labour and pious stewardship of the people who produced and distributed that good. Here also the essential value of the buyer (such as a God-imaged, though poor serf, needing food) must determine the price of, say, bread if that price is to reflect true value. So you would not get an instrumental answer to a “what is?” question of any sort from a Medieval. Further, in relation to the question “what is money?” it would not occur to a Medieval that real wealth, and any means by which wealth is exchanged, would be an arbitrary fiction that had nothing to do with moral and spiritual truths.

Continued at http://yanisvaroufakis.eu/2014/06/14/the-metaphysics-of-money-guest-post-by-paul-tyson/ .

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The Metaphysics of Money (Original Post) TexasTowelie Jun 2014 OP
two good points to ponder: DonCoquixote Jun 2014 #1
Yes, it's like the Mandate from Heaven bananas Jun 2014 #3
The man asks some sound questions. nt bemildred Jun 2014 #2
Gold Bug?!? modrepub Jun 2014 #4

DonCoquixote

(13,615 posts)
1. two good points to ponder:
Mon Jun 16, 2014, 08:41 AM
Jun 2014

One, the whole purpose of money replacing barter is that it was something that was supposed to be fixed and agreed on. You could have all the apples you wanted to trade with, but if your neighbors wanted meat, you were out of luck. Now, in this era, the actual value of money has been so abused that it's value is hard to pin down. You have most major currencies, from the Yuan to the Euro to our own Dollar, being manipulated and twisted by the financier class that the actual value of that money flies in the wind like a tattered flag.

Two: that for all the talk of economists, the actual nature of money is NOT a pure science at all. At the very most, it can be called a social science, a tool to treat things which are NOT empirical (aka measured by the five senses) with scientific methods. However, we should also note that religion, even if it is just the shadow of relgions impact, bleeds into this. America was founded by a bunch of Calvinists; people whop believed that God showed his favor on his "elect" with money, and that a lack of money relfected a lack of moral character. Who can debate that American economics is based on the idea that the poor deserve to be poor, and the rich deserve eveything they have and more. China, on the other hand, may be offically athiest, but it has several thosuand years of ancestor worship and worship of the state, so that even their billionaires are expected to be accountable to the whole. No one needs to believe in Gods to feel the impact of the ideas behind religion.

bananas

(27,509 posts)
3. Yes, it's like the Mandate from Heaven
Mon Jun 16, 2014, 01:34 PM
Jun 2014

applied to economic power instead of political power.

http://en.wikipedia.org/wiki/Mandate_of_Heaven

The Mandate of Heaven is an ancient Chinese belief and philosophical idea that heaven (天; Tian) granted emperors the right to rule based on their ability to govern well and fairly. According to this belief, heaven bestows its mandate to a just ruler, the Son of Heaven, and withdraws it from a despotic ruler, leading to the overthrow of that ruler. The Mandate of Heaven would then transfer to those who would rule best. The fact that a ruler was overthrown was taken by itself as an indication that the ruler had lost the Mandate of Heaven.

<snip>

The Mandate of Heaven is similar to the European notion of the Divine Right of Kings in that both sought to legitimize rule using divine approval. However, the Divine Right of Kings granted unconditional legitimacy, whereas the Mandate of Heaven was conditional on the just behavior of the ruler who was guided divinely by his dreams.

<snip>

The greatest theologians of Europe, from John Calvin and John Knox to Thomas Aquinas, Robert Bellarmine, and Juan de Mariana, were closer in their beliefs to the Mandate of Heaven than to the Divine Right of Kings.

<snip>

Its equivalency is found in Celtic societies, Judaism's kings, and numerous societies at least as far back as Ancient Egypt which used dreams and/or visions as their guiding post. In Egypt it appears in Imhotep who used his inspired ability for saving the people of Egypt from a famine, for cures and remedies, for construction projects and to guide the pharaoh Djoser.

<snip>

modrepub

(3,467 posts)
4. Gold Bug?!?
Tue Jun 17, 2014, 10:31 AM
Jun 2014

I'll admit I have a great interest in money and how it works. I'll also admit it's a very complicated subject that I don't fully understand but this guy seems to be pushing us back into using a gold standard. While a gold standard appears to provide some "real value" to money I'd like to point out there were just as many booms and busts back in the day (including the crash of 1929).

Banks routinely lend out more than they have. They take a chance that they will have enough reserves on hand to meet demand. Taking this risk allows our society to build things and increase wealth. Not to say there aren't negative consequences to this model but I would argue that our advancements over the last 70 years, all financed with fiat money, are nothing to sneeze at.

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