On Thu, 10 Oct 1996, Steve Keen wrote:
> For money itself--and here I mean notes issues--the "price of a dollar"
> is set not by its exchange-value (the cost of production of the note)
The cost of production of a dollar bill is unrelated to its
exchange value. Do you mean that its exchange value is not
set by its value?
> but by its use-value. This could notionally be tied to the amount of
> gold the note represents, and hence to the cost of production of a real
> commodity, only if the gearing between notes issues/stocks and gold
> output/stocks was 1:1, and the direction of causation was gold-->notes.
"The price of a dollar is set by its use-value." Isn't this
backwards? Dollar bills have essentially zero use-value
other than serving as means of exchange (leaving aside
coke-snorting). Thus they have use-value only insofar as
they have exchange-value. And they have exchange value
insofar as they are (a) defined by the state as legal
tender, acceptable for paying taxes and all that, and (b)
restricted in their issue (to some degree or other) relative
to the "demand" for means of payment associated with the
going rate of transactions in real goods and services.
Allin.