Great article, explaining MONEY


Ground Beetle
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I am sure that most of us have at least few thoughts about the nature of money, the philosophical and economical implications of what money is, what most people think what money is, is fractional reserve banking good/bad/needed at all, etc.

I've came across a GREAT article (albeit a bit long), that is really a conscious, fantastic summary, explains these things leaving no stone unturned, disproves the currently widely spread Neo-Keynesian fallacies in a way, that any person equipped with two functioning braincells can instantly see through it, and it is kind of the intellectual gem, that you come across every now and then. It is written by Detlev S Schlichter, author of "Paper Money Collapse" (if the book is as good as the article, it makes me want to read it).

Some great excerpts:

Re: money printing exercises:
A growing economy does not need a growing supply of money and therefore does not need a money producer. On the basis of a stable and given supply of widely accepted money the public can satisfy ANY demand for money it may have
Via the constant buying and selling of money versus non-money goods the public automatically adjusts the velocity of money and the exchange value of the monetary unit, and thus the public is always in possession of precisely the amount of money purchasing power it needs. It is in the very nature of a medium of exchange that any quantity of it – within reasonable limits – is sufficient (and indeed optimal) to satisfy ANY demand for money. is fungible, right?

Be that as it may, there is certainly no process available by which even the most dedicated, smartest and impartial monopolist money producer could anticipate the discretionary changes in the public’s desire for money balances and neutralize the resulting changes in money’s purchasing power through pre-emptive money injections or withdrawals. Once the changing demand for money has articulated itself in any statistical variables (and, in particular, in rising or falling prices) the public will already have satisfied its changed money demand through the processes described above. The whole idea of superior monetary stability through a central state monopolist is entirely absurd.
I totally recommend the whole article - for one's own clarity :)