seems like the same fundamental misunderstanding as the venus project people have. business to business barter could never take the place of money because it is necessary to have a heterogeneous unit of account inorder to have prices. Prices are necissary inorder to calculate profit and loss and inorder to account for opportunity costs. Calculating profit loss and opportunity costs is necessary in order to rationally allocate scarce resources and to communicate, in a useful way, the decentralized knowledge of individual market actors. Self issued credit is great, but it must be priced, and inorder to do this you need a widely understood unit of account.
so imagine trying to know how many shoes an elevator is worth, and how many elevators a mongoose is worth, and how many mongeese a cheeseburger is worth, with out using "money" as an intermediary step.
Yeah it has that he calls it Q
"Q is not a constant it is variable, units of measurement are not variable." - quote from me to Paul
True. Therefore, in my analysis, if we want to create a fair and stable value unit, the best that can be achieved is to define a "universal Q" as a constant, accepting that this can only ever be an arbitrary approximation of an indefinite variety of "other choices".
I have chosen to use the RICI basket of 37 world commodities as Q.
This is rational because the necessities of agriculture, mining and energy are part of most people's "other choices".
Example: "You can't buy this hot tub because we won't have money left for the fuel bill or groceries to feed the kids."
Thus, ultimately all discretionary purchases are evaluated against necessary purchases, no mater how poor or rich one might be.
Therefore, my proposal is that Q should consist of necessary purchases of the global population, which is what the RICI is designed to be.
Once we define Q, the fixed basket of necessities, we can then define a new value unit as the US dollar value of that fixed basket which, of course, includes energy.
This basket is a constant, assuming quality consistency of the products in the basket.
It 's US dollar value is defined by futures contracts in markets all over the world. No matter what happens to the US dollar, the new value unit still buys the same basket of global necessities.
The US dollar can be translated into any other currency in established markets, and replaced if necessary. This can continue until there is no national currency left to define the new value unit against.
By then, if it ever happened, the stable value in real goods of this new unit would be well established in peoples minds and would be, as always, just as individually subjective and variable as the $20 bill was, blowin' in the wind.
"been looking for someone to develop a real digital currency with a definable unit and a elastic supply,"- quote from me to Paul
That is precisely what I have been working towards.
