A hard currency standard is the key to world peace

[zarus tathra]

The feds do a lot more to subsidize growth than to restrain growth. They regularly sell trees and gold mining territory for a fraction of its market price. Plus, land grants, farm subsidies that encourage excessive destruction of habitat, etc.

And if you bet on a company like Enron, then you deserve to lose your investment.

[Hakurei Reimu]

The feds do a lot more to subsidize growth than to restrain growth. They regularly sell trees and gold mining territory for a fraction of its market price. Plus, land grants, farm subsidies that encourage excessive destruction of habitat, etc.

The feds want to keep growth at a certain level. Not too much, and not too little. Because people tend to get pissy when they're unemployed because the economy is in a slump.

And if you bet on a company like Enron, then you deserve to lose your investment.

Yes, hindsight is always 20/20.

[Jmpty]

I was actually referring to Enron's manipulation of energy prices in California, ZT, but I'm sure you already know all about that.

[zarus tathra]

The system can't work if the people don't enforce capped energy prices. I admit that. This system would at least have the advantage of being transparent enough to make it obvious when the people are getting screwed by the system, i.e. plants getting taken offline/printing press is getting run.

In the case of Enron's manipulations, the manipulations were pretty obvious. They were buying plants and taking them offline, that's about as blatant as you can get.

[Hakurei Reimu]

The system can't work if the people don't enforce capped energy prices. I admit that. This system would at least have the advantage of being transparent enough to make it obvious when the people are getting screwed by the system, i.e. plants getting taken offline/printing press is getting run.

But oh so many disadvantages, as been pointed out before. And the only advantage you have so far put forward is in truth the least consequential of them. You can't get screwed with a currency unless the promise it represents is reneged on. Thus, the value of a currency depends much more on the trust placed in it than even its base. Even our own fiat currency of a dollar has a promise — you can always use a dollar to erase one dollar in taxes owed, and to pay off any debt where its method of payment is not otherwise specified.

In the end, there's really no such thing as a non-fiat currency. A government really strapped for cash can renege on a hard currency promise just as easily as it can renege on a fiat currency one. In your case, those power plants can simply be repurposed for generating power to sell instead of backing the currency.

[zarus tathra]

Yes, it's still a paper currency, just like the greenback and a gold standard. Difference is, you're ALWAYS spending money to buy electricity, while with a gold standard, you almost never spend money to buy gold. In fact, most people never do, and that's why the banks are able to screw people over on a gold standard. There are only runs on banks when there are wars and depressions, basically, after the printing presses had been run for years; at all other times, complacency is the default.

With a joule standard, no matter how complacent the population gets, they never stop buying electricity. So unlike a gold standard, there is ALWAYS a run on the bank. The only way that the bank run would ever STOP would be if all the machines, including household appliances, were to shut down, which won't happen. So there's no faking this standard the way there is with a gold standard. It'd be transparent, and nobody can argue that a little transparency in our monetary system wouldn't be FUCKING AWESOME.

And what are the downsides of this, again? Not being able to inflate your way out of a depression? Pfft, it's not like that actually works in the real world, anyway. I mean, even the New Deal didn't do shit to bring about an economic recovery, the economy didn't really start to grow until the early 1950's.

[Hakurei Reimu]

Yes, it's still a paper currency, just like the greenback and a gold standard. Difference is, you're ALWAYS spending money to buy electricity, while with a gold standard, you almost never spend money to buy gold. In fact, most people never do, and that's why the banks are able to screw people over on a gold standard. There are only runs on banks when there are wars and depressions, basically, after the printing presses had been run for years; at all other times, complacency is the default.

With a joule standard, no matter how complacent the population gets, they never stop buying electricity. So unlike a gold standard, there is ALWAYS a run on the bank.

You do know the difference between buying with currency and redeeming the currency, do you not? Actually, it seems that you don't. You can buy gold with a gold-backed currency, but that doesn't redeem it. The currency held by the gold seller is still fully-backed, and may be used to buy other goods. If citizens simply buy electricity with joulebucks, those joulebucks are still backed and may be used by the power company to do stuff like pay its workers and buy fuel. Sure, the power company could redeem the currency and then reissue it (if it were so authorized) but that's just stupid when you can just use the still-valid joulebucks to pay them, especially if redeeming the currency and reissuing them have additional administrative overhead, like tracking numbers and shit — and there always will be. Further, if the tracking numbers on a physical bill can't be reissued to that same physical bill (for whatever reason, like if the tracking number has been snatched up by another firm for reissue), you have to destroy and reprint the bill, which makes the practice doubly-stupid — paper and ink ain't free, ya know.

So, no. The fact that people will not stop buying electricity has fuck all to do with the backing of your joulebuck. As such, changing the basing of the currency would have no measurable effect on the use of the currency. There will be no perpetual "runs on the bank" for this currency because it will simply be used to buy that electricity instead of going through the administrative hassle of redeeming the currency then reissuing it almost immediately. Thus, you have exactly the same situation you have with the gold-backed currency — default complacency, with "runs on the bank" when trust in the currency is lost.

And what are the downsides of this, again? Not being able to inflate your way out of a depression?

You have not proved that you will not be able to inflate your way out of a depression with the joulebuck. In fact, some of the solutions you propose would actually aggravate it, like your ridiculous "auto-deflation" scheme you mentioned a while back.

[zarus tathra]

You do know the difference between buying with currency and redeeming the currency, do you not?

Either way, you exchange paper for something else, the basics are the same and they're close enough for our purposes. A centralized distributor that you "redeem" from wouldn't be able to hold their prices very far above or below the market price for very long. I thnk you're overcomplicating things on purpose.

You have not proved that you will not be able to inflate your way out of a depression with the joulebuck. In fact, some of the solutions you propose would actually aggravate it, like your ridiculous "auto-deflation" scheme you mentioned a while back.

Huh? Being able to inflate our way out of depression with the joulebuck would make it substantially BETTER than fiat currency.

[aitm]

sure

[zarus tathra]

Sorry, how easy does the language have to be for you to get it?

[Hakurei Reimu]

You do know the difference between buying with currency and redeeming the currency, do you not?

Either way, you exchange paper for something else, the basics are the same and they're close enough for our purposes. A centralized distributor that you "redeem" from wouldn't be able to hold their prices very far above or below the market price for very long. I thnk you're overcomplicating things on purpose.

Yeah, backpedal some more, why don't you? You stated that because people will always need electricity, the joulebuck would always be tested. But here you admit that it is not — that it's being treated in exactly the same way as would a fiat currency. And here you admit that such a scheme of testing would require a central authority, which is what I stated way back here with all of its attendant problems.

You are still dodging the issue: you are not redeeming the bill, and as such, its value is still depends completely on trust, as with a fiat currency.

You have not proved that you will not be able to inflate your way out of a depression with the joulebuck. In fact, some of the solutions you propose would actually aggravate it, like your ridiculous "auto-deflation" scheme you mentioned a while back.

Huh? Being able to inflate our way out of depression with the joulebuck would make it substantially BETTER than fiat currency.

Now you're speaking out of both sides of your mouth. First you imply that the joulebuck is not able to inflate and that's an advantage, and now you're saying that being able to inflate is an advantage? Which is it?

[zarus tathra]

It's not "trust," you're buying electricity all the time, how is that trust?

If the power company prints too much money and tries to keep electricity prices from going over the limit, people are going to buy a lot more energy than there is in the system and the system will collapse. If you decrease the price, the people are going to buy more. And if you print too much money, then the natural price will rise too far. And if you lower the price below what should be the market price, then they will overburden the system and you create a shortage, which, unlike a bullion shortage, would be obvious instantly because electricity travels really, really fast and power outages kind of happen instantly.

[Hakurei Reimu]

It's not "trust," you're buying electricity all the time, how is that trust?

Is the company you're buying the electricity from not trusting that the notes are genuine?

If the power company prints too much money and tries to keep electricity prices from going over the limit, people are going to buy a lot more energy than there is in the system and the system will collapse.

Bullshit. You can only draw so much current before you blow out your fuse, and if you try to circumvent that with anything other than upgrading your electrical wiring, you'll set your house on fire.

Furthermore, normal power companies will not be printing money. They'll just be selling electricity. If they can't meet demand, you'll just have brownouts because —ya, know— they're not responsible for redeeming your currency, so they being tapped out has no bearing on the nominal value of the currency.

If you decrease the price, the people are going to buy more.

Who says they'll be decreasing the price? If they're running a swindle (which is what your ridiculous testing scenario claims to prevent), the price isn't going to change, and neither will demand.

And if you print too much money, then the natural price will rise too far. And if you lower the price below what should be the market price, then they will overburden the system and you create a shortage, which, unlike a bullion shortage, would be obvious instantly because electricity travels really, really fast and power outages kind of happen instantly.

The electricity may be able to travel that fast, but the currency does not. It has the speed of the fastest mail truck. And it must be delivered to the BOE/Treasury for redemption (and subsequent and verified destruction of the bill), and a means of returning the redeemed joules negotiated and sent back through the mail. Very few people are going to bother with that to get electrical power, rather than simply buying electricity on credit from a commercial power company, which —once again— does not redeem a single joulebuck in currency.

The only way you are going to get this continuous stress test of the currency is if you mandate it, and it will be a very, very, very hard sell.

[zarus tathra]

Is the company you're buying the electricity from not trusting that the notes are genuine?

Yeah, but I thought that you were talking about the trust that ordinary consumers put in the system.

Bullshit. You can only draw so much current before you blow out your fuse, and if you try to circumvent that with anything other than upgrading your electrical wiring, you'll set your house on fire.

Most of our electricity usage comes from industry, if people start buying too much stuff industry will start producing too much and using too much electricity.

Furthermore, normal power companies will not be printing money. They'll just be selling electricity. If they can't meet demand, you'll just have brownouts because —ya, know— they're not responsible for redeeming your currency, so they being tapped out has no bearing on the nominal value of the currency.

That's a sign that the system's printing too much money, and it's an instantaneous sign of system failure. That's exactly what I want.

The electricity may be able to travel that fast, but the currency does not. It has the speed of the fastest mail truck. And it must be delivered to the BOE/Treasury for redemption (and subsequent and verified destruction of the bill), and a means of returning the redeemed joules negotiated and sent back through the mail. Very few people are going to bother with that to get electrical power, rather than simply buying electricity on credit from a commercial power company, which —once again— does not redeem a single joulebuck in currency.

If it were just a monthly or even yearly stress test, that would be orders of magnitude better than anything we've ever had.

[Hakurei Reimu]

Is the company you're buying the electricity from not trusting that the notes are genuine?

Yeah, but I thought that you were talking about the trust that ordinary consumers put in the system.

Is the power company selling electricity not an ordinary customer for its own suppliers?

Bullshit. You can only draw so much current before you blow out your fuse, and if you try to circumvent that with anything other than upgrading your electrical wiring, you'll set your house on fire.

Most of our electricity usage comes from industry, if people start buying too much stuff industry will start producing too much and using too much electricity.

Not before new factories are built to draw that current, which will incite power companies to build more power plants to sell them that electricity. And they're not going to draw any more current than their machines are rated for, either, because they'll set their factories on fire.

Furthermore, normal power companies will not be printing money. They'll just be selling electricity. If they can't meet demand, you'll just have brownouts because —ya, know— they're not responsible for redeeming your currency, so they being tapped out has no bearing on the nominal value of the currency.

That's a sign that the system's printing too much money, and it's an instantaneous sign of system failure. That's exactly what I want.

So if your local grocery store runs out of avocados, that means we're printing too much money? Because the exact same logic applies.

Once more, that commercial power company is NOT RESPONSIBLE FOR REDEEMING YOUR CURRENCY, and you have NO expectation that it will do that, and if you try to argue otherwise, they'll point you to their policy stating clearly that they do not redeem joulebucks and that all joulebucks are best redeemed by the Bureau of Engraving.

Stop shipping this argument. It is dead, no matter how often and how loudly you insist that it is live. The only body who would maintain the value of your joulebuck is the Treasury, not individual private power companies (because nobody but the Treasury will do it willingly), just as it was the Treasury that maintained the value of the US gold dollars regardless of whether private gold sellers had sufficient stocks of gold to sell you.

If it were just a monthly or even yearly stress test, that would be orders of magnitude better than anything we've ever had.

So much for a continuous stress test, and you can't even seem to get any sort of stress test started, much less on even a yearly schedule. You cannot point to any behavior for the joulebuck on the general market that would differ from a fiat dollar. In order for your joulebuck to be stable by design, there would have to be some difference in how it works on the general market. So far, you've come up with zilch.