What money is, what it represents, is value. But value is a complete opaque quality. At best we have an approximation: an 'expectation' of value. Expectation results in people paying for more for misprinted coins. Expectation is the same reason that drives people to stocks, to silver/gold, to oil. Expectation can be manipulated. If you can make others expect greater value of an item (and then they exchange such a value to you for that item) than what you are giving them: that difference is profit.
To be clear, I don't like this outlook. But I've found it to be accurate to how people behave around money. It's not a sign of a healthy society.
There is no sense in which counterfeiting bank notes was a creative force in the economy and not just theft. The article doesn't really attempt to justify the title.
fake stops being an applicable term as soon as people start agreeing to accept it, which the article says happened. Then it's as legitimate as anything like Bitcoin.
If everyone continues to agree it's worth what it says then not very much. Of course the whole thing can collapse for a number of reasons, not much different from other mediums of exchange that don't have an intrinsic utility, the utility is a sufficient number of people willing to cooperate. Which is pretty much everything except bartering goods.
> “It would not be an exaggeration to call these criminals capitalists,” he concludes, “even if their idea of making money was more literal-minded than the bankers whose notes they imitated.”
Counterfeiting is fraud, not capitalism. Even a so-called “lender of last resort” cannot exist under capitalism, but only under a system of dirigisme or worse.
Still to this day, fake money continues to build America and afford the American lifestyle.
USD is backed by petrodollar, which is backed by US Navy and depends on US Armed Forces bombing anyone who refuses to use USD as a reserve and trade ccy.
USA is $39,000,000,000,000+ in debt as-is, if you add SS and Medicare shortfall, federal pensions and guarantees, the total figure baloons to $125,000,000,000,000+
This reminds me of a very fun episode of the Uncivil podcast, which talks about a northern guy who started counterfeiting Confederate money during the Civil War: https://podcasts.apple.com/us/podcast/the-paper/id1275078406...
What money is, what it represents, is value. But value is a complete opaque quality. At best we have an approximation: an 'expectation' of value. Expectation results in people paying for more for misprinted coins. Expectation is the same reason that drives people to stocks, to silver/gold, to oil. Expectation can be manipulated. If you can make others expect greater value of an item (and then they exchange such a value to you for that item) than what you are giving them: that difference is profit.
To be clear, I don't like this outlook. But I've found it to be accurate to how people behave around money. It's not a sign of a healthy society.
"In the first half of the 19th century, for example, the Midwest was so short of authentic banknotes that people knowingly accepted counterfeit ones."
Sounds like a more traditional form of IOU to me. Which was a fairly widespread thing if I'm not mistaken?
Passing a counterfeit note is like an IOU except the I is someone else who didn't agree to owe you anything.
There is no sense in which counterfeiting bank notes was a creative force in the economy and not just theft. The article doesn't really attempt to justify the title.
Even creating real money becomes theft at a certain scale.
fake stops being an applicable term as soon as people start agreeing to accept it, which the article says happened. Then it's as legitimate as anything like Bitcoin.
What would happen if all the people who agreed to accept it would also want to withdraw it from their accounts at the same time?
If everyone continues to agree it's worth what it says then not very much. Of course the whole thing can collapse for a number of reasons, not much different from other mediums of exchange that don't have an intrinsic utility, the utility is a sufficient number of people willing to cooperate. Which is pretty much everything except bartering goods.
withdraw for what? for fiat(=fake) paper bills, or for similarly fake digits on a mobile app?
Remember, it's always been fake & made up
https://youtu.be/LtFyP0qy9XU?t=76
Fake Money Built [the World].
No need to pretend that one particular group of people are that special.
The premise is interesting, though a bit of an exaggeration. A very enjoyable read though.
> “It would not be an exaggeration to call these criminals capitalists,” he concludes, “even if their idea of making money was more literal-minded than the bankers whose notes they imitated.”
Counterfeiting is fraud, not capitalism. Even a so-called “lender of last resort” cannot exist under capitalism, but only under a system of dirigisme or worse.
What a ridiculous title lol.
Still to this day, fake money continues to build America and afford the American lifestyle.
USD is backed by petrodollar, which is backed by US Navy and depends on US Armed Forces bombing anyone who refuses to use USD as a reserve and trade ccy.
USA is $39,000,000,000,000+ in debt as-is, if you add SS and Medicare shortfall, federal pensions and guarantees, the total figure baloons to $125,000,000,000,000+
debt: https://www.us-debt-clock.com/
unfunded liabilities: https://www.us-debt-clock.com/unfunded-liabilities
To people who downvote this: can you guys clarify what is the difference between a counterfeiter and US?
At least counterfeiter does not force you to accept his fake bills, while holding you at gunpoint and pointing a missile at your family