Time Value of Money

[Shogun Gunner]

It's a semantic argument.

[Kidlicious]

huh?

[Shogun Gunner]

It's a troll....as stated very early in the thread.

[Kidlicious]

Originally posted by Shogun Gunner
It's a semantic argument.

It's not at all. It's all very simple. Does money create money? Does borrowing money or buying stock create anything. Of course not.

[Kidlicious]

Originally posted by Shogun Gunner
It's a troll....as stated very early in the thread.

I was refering to a post that I did not read. Not yours.

[Flubber]

Originally posted by Kidicious


I was refering to a post that I did not read. Not yours.

How exactly do you refer to something you do not read?

[Shogun Gunner]

Originally posted by Kidicious


It's not at all. It's all very simple. Does money create money? Does borrowing money or buying stock create anything. Of course not.

In Economics the perception is as strong, or even stronger, than the reality. Its speculation. If you are asking if "money creates money", well of course not.

However, I think you are oversimplying this topic. The action of one economic agent has an effect on the marketplace. In this case, investment made by one agent, allows another agent to obtain the captial (at a price) and create economic activity (start a business, whatever). After some time, the first economic agent get his captial back and a profit. From his perspective, if he were a real simpleton, he would declare, "By golly, my money just made me more money!"

This fluidity of capital allows economic activity to occur where it otherwise would not.

Now, there is a debate between the "zero sum game crowd" and "perpetual growth crew" but that's for another thread....

[Kidlicious]

Originally posted by Shogun Gunner


In Economics the perception is as strong, or even stronger, than the reality. Its speculation. If you are asking if "money creates money", well of course not.

However, I think you are oversimplying this topic. The action of one economic agent has an effect on the marketplace. In this case, investment made by one agent, allows another agent to obtain the captial (at a price) and create economic activity (start a business, whatever). After some time, the first economic agent get his captial back and a profit. From his perspective, if he were a real simpleton, he would declare, "By golly, my money just made me more money!"

This fluidity of capital allows economic activity to occur where it otherwise would not.

Now, there is a debate between the "zero sum game crowd" and "perpetual growth crew" but that's for another thread....

But it's not just the money holder's perspective. It's the perspective of a society that justifies capitalism.

If work creates all value, as we have agreed, and money is compensated (for whatever, if anything, that it does), then you have to have a justification for that. The concept of the time value of money serves as that justification, and as I have said, it's nothing but smoke and mirrors.

edit: because it completely ignores the fact that the only value created was created by those who produced the goods and services consumed or those who will produce those goods and services in the future.

[Shogun Gunner]

I have not agreed that labor is the only input to price (or value). Labor is a signficiant, large input to value/cost. However, I have maintained that speculation and lending assets/capital for a fee also contribute to value/cost.

I think the real question is what I semi-seriously posed before which is whether the economic system is a zero-sum game (for every winner there is a loser) or if there is growth (the economic pie grows over time).

I don't see how you can get around the points that Flubber, myself and others have made in this thread. Since I don't know you very well, I'm assuming this is a bit of "tongue in cheek".

I'm not against communists, but really, how many threads have there been just at Poly about the failures in communism. You might not like capitalism, but it's an established economic system that works. Your tenet that "money doesn't make money" flies in the face of most economic theory. Who knows, maybe everyone else is wrong and you are right -- you could be the next John Maynard Keynes!

[Japher]

I think the real question is what I semi-seriously posed before which is whether the economic system is a zero-sum game (for every winner there is a loser) or if there is growth (the economic pie grows over time).

Good question...

[Flubber]

Originally posted by Shogun Gunner

I don't see how you can get around the points that Flubber, myself and others have made in this thread.

He doesn't try to get around my posts . .. he simply ignores inconvenient realities. I've lost count of the number of directly on point posts that he fails to address.

Once you get to know kid you will understand. he posts variations on the same theme (capital is valueless. rent is an unfair tax or interest should be illegal) from time to time. I still find it fun to chime in from time to time

[Kidlicious]

Originally posted by Shogun Gunner
I have not agreed that labor is the only input to price (or value). Labor is a signficiant, large input to value/cost. However, I have maintained that speculation and lending assets/capital for a fee also contribute to value/cost.

Flip-flopper. I specifically asked you if charging you an interest rate created value, and you said "of course not"

I think the real question is what I semi-seriously posed before which is whether the economic system is a zero-sum game (for every winner there is a loser) or if there is growth (the economic pie grows over time).

I'm not arguing that it's a zero sum game. Just the opposite of course. The sum is greater than the parts. Everyone knows that I believe this.

I don't see how you can get around the points that Flubber, myself and others have made in this thread. Since I don't know you very well, I'm assuming this is a bit of "tongue in cheek".

I ignore Flubber. Isn't that obvious? He's quite annoying.

I'm not against communists, but really, how many threads have there been just at Poly about the failures in communism. You might not like capitalism, but it's an established economic system that works. Your tenet that "money doesn't make money" flies in the face of most economic theory. Who knows, maybe everyone else is wrong and you are right -- you could be the next John Maynard Keynes!

You're flip-flopping again.

This isn't really about communism. In fact the first person to call the concept of the time value of money magic was Keynes, and he was no communist.

[Japher]

I was once was able to get 4 candy bars for a dollar... now I am luck if I can get 2. Why?

Did they start putting more or different stuff in the candy bar? Did the manfuacturer or other person down the chain of command just get more greedy? Is the wrapper made of pure gold? Was there some strange candy tax levied on the bar?

Actually, the dollar's purchasing power just became less. I could no more buy the same amount of soda for a dollar than I could candy bars.

In that sense it is a zero sum game? That, however, is the time value of money.

[Shogun Gunner]

Well, in that case I think the FICA tax isn't really a viable economic concept and I'm going to demand that payroll stops the criminal process of removing these funds from my bi-weekly compensation distribution.

Prove to me that FICA tax is a valid economic activity. Oh, you can't, can you. That's all the proof I need....here I go walking down to payroll......

[Shogun Gunner]

Originally posted by Japher
I was once was able to get 4 candy bars for a dollar... now I am luck if I can get 2. Why?

Did they start putting more or different stuff in the candy bar? Did the manfuacturer or other person down the chain of command just get more greedy? Is the wrapper made of pure gold? Was there some strange candy tax levied on the bar?

Actually, the dollar's purchasing power just became less. I could no more buy the same amount of soda for a dollar than I could candy bars.

In that sense it is a zero sum game? That, however, is the time value of money.

That's right on.