Money?
Bylund is able to explain the very complicated role of money and pricing by the discussion on the function of prices, the process by which prices are set, and the significance of doing so. The "mechanism" of prices and the essential part they play in the market. The revealing of the "invisible hand," as well as the distribution of the available resources. Money in the economy can be a very tricky topic if not educated well, so I feel that Bylund does a very good job overall in opening the readers eyes from the very beginning of his article. I also felt that his referral to the "Price is right " was a very good foundation, and a great, different way of thinking about money and the economy. Money can be challenging, so it is good to have a reference to a popular game show so people can think about it from a different perspective and understand the aspects of the certain topic better.
And what's to say the price is "right"?
Right Price
Bylund explains very well that the market prices often varies from different place to different areas, again referring the the popular game show to give us a clear idea of what is meant by the "right price". Inflation is also another major factor in this subject, times begin to change, and the prices, resources, and many other factors affect the way our inflation rises/declines in our everyday lives. Many times, we don't even see the factors happening, but they happen every day, even more than we know.
Have you ever looked for the root of production?
Stable Money
Francisco uses this as the main reference to his argument during his speech, and I really liked it. I had to stop myself and really think about what he was talking about when I first read it. I feel that he is trying to spread light on the real way that money is brought to be. There is so much work when it comes to consuming money, and many people only see it as getting money and that is all. Money is consumed by starting all the way back to producing goods and the people that work hard to make sure that others have the goods they need to make this money. Francisco spreads light on everyone that does lots of work but may not always be seen. Often times, a successful person also knows the value of getting quality goods in order for his/her venture or product or whatever it is to succeed.
Francisco talks about money be a "tool of exchange", and I also really liked his perspective on this topic. Money is a way to trade goods, and it can't exist without goods and people who can make them. Money is the physical form of the idea that if two people want to do business together, they must trade and offer importance for value. Money isn't the weapon of the freeloaders who take your stuff by force or the moochers who beg for it. Men are the only ones who can make money.
Having stable money is a skill that everyone has a goal to learn. It is something that you learn from day to day interactions, exchanges, work etc. There is so much to be learned out there, and the most successful find that the more they were out in their field, and even other fields, the more they learned, and found that it guided them in their journeys.
Stable money as a measure of value doesn't ensure that every trade will yield better or equal to what was produced.
I really like what Keynes is trying to say here, I feel that he is stating that sometimes when you take risks it does not always mean there is a definite chance that it will succeed. A strong currency is a type of money that hasn't changed much in value for a long time. It's any form of money that most people use and that has a history of keeping its value and being a reliable form of money for people to use everyday. That is part of what makes risk takers so special is their ability to understand this acquired trait. It is important while taking risks to ensure that you are always taking marginal risk to ensure that you are able to cover yourself, if something were to happen taking it under. The best risk takers understand this, and oftentimes this is what makes them so successful, we are seeing their once marginal risk pay off in the long run.
Overall I felt that there were many good points that Keynes brings up in his writing, and he did a very good job explaining his findings in order to help everyone be more successful in their fields, and their lives.
I agree with a lot of what you had to say, especially about money and its function in the exchange. Without some currency that has a uniform value regardless of where it is cashed in, making transactions can be incredibly difficult. Instead of just finding someone who has what you want, you would have to find someone who has what you want AND wants what you have. This type of transaction is inefficient and outdated. Money expedites this exchange and allows the seller to gain something of universal value that he/she can turn into goods or services at a later date. You summed this concept up nicely with, “Money is the physical form of the idea that if two people want to do business together, they must trade and offer importance for value”. Anytime two people make a transaction, they both value what they are receiving more than what they are giving up, just by the nature of the exchange. Of course, for this to even be possible, society has to recognize the given currency as a stable hold of value. In the past, the dollar was tied to the price of gold which was extremely stable. Nowadays, the dollar holds its value based off the word of the government, which some find to be unnerving. It’s this idea that the dollar can be used anywhere that truly makes it a valuable asset. If all of a sudden, the value of the dollar plummets and businesses don’t accept it as payment, then the dollar is essentially nothing more than a piece of paper. One of the articles discussed how post World War Germany devalued their currency so much that cigarettes became the most valuable currency of the country. Because so many Germans smoked, this was a nice store of value and essentially became money. Money exists solely as a middleman for exchange. It can’t be used to do anything at all, yet society places so much emphasis on making money because of what it represents. Money represents anything you can imagine. It gives us the freedom to decide what we want to “turn it in to”. It’s a tool that is imperative to the entrepreneur and the economy. Efficient exchange results in an efficient and strong economy where citizens are confident that their green pieces of paper will be worth something when it is time to cash them in.
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