Paper is worth more than gold.

Paper is worth more than gold.


Peter Wakefield Sault and Ardeshir Mehta are right about gold, paper and "thin air."

Paper: Wrapping gifts, preserving readable written symbols without advanced electronics using a minimum of space, freshening up a bit after sitting on the toilet.

Gold: Filling teeth, carrying electrons, serving as high-exchange rate per volume commodity with advantages of convenience in a barter economy.

What is the difference in worth -- in your willingness to incur cost to possess it -- among

1) a three inch by six inch blank piece of paper;

2) a 3" x 6" IOU payable to the barer in 20 free fill-ups at a local gas station;

3) a 3" x 6" piece of paper with discriminable markings making it acceptable to a community in which sociological conditions are such community members are relied upon to accept such paper because of its historical generalized exchange power, or purchasing power -- now exchanging for roughly 20 free fill-ups at a local gas station

4) a 3" x 6" x 1/100th inch plate of gold with nothing engraved upon it

5) such a plate of gold with the markings: "good for 20 free fill-ups" at a local gas station

6) such a plate of gold with the markings acceptable as conditioned generalized "reinforcement tokens" as in #3 above, exchanging for about 20 free fill-ups among people of the community?

You say -"Anything to stop the bankers from creating money out of thin air would be a step in the right direction." But do you understand that it is the bankers who are doing the "making" that is the problem. We need a medium of exchange. People can learn (be conditioned) to accept any of a number of substances or tokens as conditioned reinforcers. [In an economy you condition all members of the community -- if you are going to have a market system; but an institution can create token systems for patients or inmates only.] The question of the political moment is -- is money being created and destroyed in the interests of the few with the monopoly power to manipulate the supply or is it being created in the interests of the many by the few with the monopoly power to manipulate the supply? This question of course raised many other questions about defining the "interests of the many" and how regulators can themselves be conditioned to serve the common interest rather than benefiting their own circle of friends and conspiracy allies.

One paradox. Gold is worth less than paper when we speak of the function of each in the world. (Just as Jevons, Menger and Walras showed that water is worth more than gold). It is only on a marginal basis -- one more ounce of water versus one more ounce of gold in your life -- that a small quantity of gold is "worth more" than a small quantity of water to those not alone and dying of thirst in the middle of the Sahara etc. Certainly the value of gold is determined by environing conditions -- especially the conditioning environment -- and not any "intrinsic value"


Dick Eastman
Yakima, Washington