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The mechanics of inflation .
a4architect.com
#1 Posted : Monday, April 02, 2012 9:49:09 AM
Rank: Veteran


Joined: 1/4/2010
Posts: 1,668
Location: nairobi
Value of money

It is not entirely correct to treat money as if it has no intrinsic value.

The value of an object is exactly what someone is prepared to pay for it right now. Put another way, the value of an object is established by people wanting that object, the value is not intrinsic to the 'object'. A farmer may value a load of horse manure rather differently than the resident of a studio flat.

Items of money are in fact objects (if you wish to get even deeper in, refer to Why Aristotelean logic does not work). Money objects are indeed valued by humans, thus money does have a real value. For example, the person wishing to sell the horse manure will very like be inclined to take money in exchange for the load, although if offered a brand new shiny motor car or a large sparkly diamond may well like that price even more.

Money is constantly exchanged for other items, including money from other countries and other negotiable instruments. The international exchange rates give an idea of the current value or desirability placed upon various issues of money.

http://www.abelard.org/inflation.php
As Iron Sharpens Iron, So one Man Sharpens Another.
kizee1
#2 Posted : Monday, April 02, 2012 1:37:29 PM
Rank: Member


Joined: 9/29/2010
Posts: 679
Location: nairobi
so inflation is a glut in money supply caused by a lack of a free market to price and allocate the same?
GGK
#3 Posted : Monday, April 02, 2012 3:49:15 PM
Rank: Member


Joined: 11/21/2006
Posts: 608
Location: Ruiru
I thought inflation is when my 1000 bob buys 5 beers instead of six
"..I am because we are. "― Ubuntu, Umtu,
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