{"id":31508,"date":"2017-01-04T01:00:14","date_gmt":"2017-01-04T06:00:14","guid":{"rendered":"http:\/\/quotulatiousness.ca\/blog\/?p=31508"},"modified":"2016-12-26T10:12:48","modified_gmt":"2016-12-26T15:12:48","slug":"qotd-the-utility-of-money","status":"publish","type":"post","link":"https:\/\/quotulatiousness.ca\/blog\/2017\/01\/04\/qotd-the-utility-of-money\/","title":{"rendered":"QotD: The utility of money"},"content":{"rendered":"

As of yesterday afternoon, a nonstop round-trip flight from New York City to Los Angeles on Independence Day weekend cost $484. That the price is so low is an incredible story in itself, one that is more important than most of what our children are taught in their history classes and one that we should not fail to appreciate, but it is a subject for another day. Consider, though, that that $484 is a messy number; it isn\u2019t an even $500 or rounded to $480 or $485. Messy numbers are a sign of real calculation, and they are the opposite of political numbers: the first 100 days in office, the five-year plan, the $15 minimum wage. <\/p>\n

That $484 is easily expressed in non-U.S. dollar contexts: \u20ac445.08, \u00a3 314.56, \u00a5 5,9573.87, 2.0349 Bitcoin. (Damn!) On the commodities market, that\u2019s 745.54 pounds of cotton or 338.5 pounds of coffee. It is 0.00000268888 of a Les Femmes d\u2019Alger<\/em>, the Pablo Picasso painting that recently set a new auction record at Christie\u2019s. <\/p>\n

There is no reason, in theory, that one could not buy a Picasso masterpiece and pay for it in coffee, or in coffee futures, or in barrels of West Texas Intermediate crude. But most sellers, and most buyers, prefer currency \u2014 a restaurant in Austin has a sign proclaiming that it \u201cproudly does not accept the American Express Card, Visa, MasterCard, checks, chickens, or pesos.\u201d Dollars do not have any inherent value; as my favorite presidential candidate, the mighty Cthulhu (\u201cWhy Vote for a Lesser Evil?\u201d) put it, dollars are merely \u201cpieces of green paper backed solely by religious dogma.\u201d (Cthulhu\u2019s fiscal policy? \u201cHe permits his devotees to collect as much paper in as many colors as they happen to like.\u201d) Dollars have value because of the things for which we can trade them: Picasso paintings (or, ideally, paintings by some superior artist), coffee, cotton, cheeseburgers, sofa beds … checks<\/a>, chickens, or pesos. This is an aspect of what in economics is known as Say\u2019s Law, which holds that goods are paid for in goods \u2014 i.e., that we manufacture widgets or grow tomatoes or write novels because we wish to consume shoes and poached salmon and Buicks. The dollar or the euro is just a way to avoid the difficulties of trading a truckload of chickens (or a convoy of them) for Les Femmes d\u2019Alger<\/em>.<\/p>\n

Kevin D. Williamson, “Bernie Sanders\u2019s Dark Age Economics”, National Review<\/em><\/a>, 2015-05-27.<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

As of yesterday afternoon, a nonstop round-trip flight from New York City to Los Angeles on Independence Day weekend cost $484. That the price is so low is an incredible story in itself, one that is more important than most of what our children are taught in their history classes and one that we should […]<\/p>\n","protected":false},"author":1,"featured_media":35193,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[25,41],"tags":[563],"class_list":["post-31508","post","type-post","status-publish","format-standard","hentry","category-economics","category-quotations","tag-money"],"jetpack_featured_media_url":"https:\/\/quotulatiousness.ca\/blog\/wp-content\/uploads\/2016\/06\/favicon.png","jetpack_shortlink":"https:\/\/wp.me\/p2hpV6-8cc","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/31508","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/comments?post=31508"}],"version-history":[{"count":2,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/31508\/revisions"}],"predecessor-version":[{"id":31510,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/31508\/revisions\/31510"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/media\/35193"}],"wp:attachment":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/media?parent=31508"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/categories?post=31508"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/tags?post=31508"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}