Basic Economic Systems

Graduate Thinker Joined: Mar 26, 2008 Posts: 513

Quote:

If you believe this you do not understand why people work and produce things and why capitalism has outperformed every other system tried.

I would have to say that yes, capitalism works well for frills better than any other system. It just does. That is not to say that it doesn't work well for anything else. Kmisho was implying that it only inspires materialism, which I would agree is not true.

Quote:

Medical care is not sunlight or some magical unlimited resource--it is the work and skills of people. Nobody can "deserve" or be entitled to the work and skills of others.

Even if they had cancer and couldn't pay for it themselves? I think that healthcare is possibly the only thing that should be more available to everyone with less free market influence. Before you jump on me about socialized medicine, read some about France's healthcare system. Yes, their doctors get riled up about socialized medicine, too. The problem with healthcare in this country is that we have made healthcare too much a capitalist enterprise. It is often very expensive and health insurance providers frequently screw people over on coverage in order to get the most money. Lawyers have made a mess of it too, suing doctors over every little thing and further driving up the cost of healthcare and health insurance.

Confident Learner Joined: Jun 09, 2008 Posts: 68

Saitou wrote:

carx wrote:

but not for necessities or anything that it could be argued that people deserve just for being people, such as medical care.

Medical care is not sunlight or some magical unlimited resource--it is the work and skills of people. Nobody can "deserve" or be entitled to the work and skills of others.

carx wrote:

It only seems to be working reasonably well for these things right now because the barrel of capitalism is nearly empty so there is a lot of fluidity for those who reside in the barrel. But if the barrel filled up, capitalism's impotence in the face of fairly distributing necessities would become readily apparent.

"Fairly" is an idea unique to the individual. I find capitalism much more fair than some government body deciding what someones work is worth to someone else. The seller and the buyer do not need a middle man swinging his "fair" bat to make a trade beneficial to both of them.

Hey why is it that you have written quoting me and I never wrote thus words ?
Please be careful while using the quote function.
Can you fix this ? You are literally putting words in my mouth Very Happy

.

Grand Poster Joined: Apr 22, 2005 Posts: 1033

(Saitou - I think you meant to quote kmisho.)

Carx - on the subject of titanium. I see no reason why you shouldn't regard this as "real money", provided that all participants in the market recognise it as having some value in terms of goods and services.

The key thing about it is its scarcity - using a less scarce resource as a medium of exchange lowers its value.

For example, that using labour as a currency ("Give me a kilo of butter and I'll dig your field") in China is very different than in New Zealand ("Give me TWO kilos of butter and I'll dig half your field") because of the abundance of supply in the former compared to the latter.

Confident Learner Joined: Jun 09, 2008 Posts: 68

Stuz719 wrote:

(Saitou - I think you meant to quote kmisho.)

Carx - on the subject of titanium. I see no reason why you shouldn't regard this as "real money", provided that all participants in the market recognise it as having some value in terms of goods and services.

The key thing about it is its scarcity - using a less scarce resource as a medium of exchange lowers its value.

For example, that using labour as a currency ("Give me a kilo of butter and I'll dig your field") in China is very different than in New Zealand ("Give me TWO kilos of butter and I'll dig half your field") because of the abundance of supply in the former compared to the latter.

Well thank you Stuz719 your the best poster I encountered.

I understand that is something is scares its value goes up .
However is “real money” necessary something material ? Cant it be something like fictitious points in a computer scoring system ? I know every of my examples qualifies for money however this question concerned “real money “.The main question concerned this

Jason_Harvestdancer wrote:

I'm not writing about purchasing gold, I'm writing about asking for my currency to be redeemed at the central bank. I'm writing about taking my federal reserve notes to the federal reserve for them to be redeemed. That's the difference that you aren't getting. It is a system of protected monopolies and irredeemable (ultimately) currency.

Even gold can be irredeemable if suddenly everyone decide not to accept it and I’m not quite getting this argument. Every money system can have it down sides I’m not understanding this redeeming thing its not like if everyone stops using gold you can redeem a gold bar for the new currency if people don’t agree , actually ever transaction is a transaction of exchange and buying is only exchanging. If everyone stops using gold and decides its worthless you have no money. Its not like you can exchange gold at the same prices regardless of its acceptances.

Newbie Joined: Jul 16, 2008 Posts: 10

MockingGods wrote:

PJS wrote:

Barter?

I'm noticing a trend though, the difference in these varied systems seems to be only where the control lies, and the other nuances are basically insignificant. It seems that under “capitalism” there is no control (I’m sure some would argue market control)? If so, what’s produced is basically what’s popular, or what private entities feel will produce the most profit.

The control is directly in the hands of both consumers and producers. Consumers drive demand and producers drive supply. Both demand and supply are informed to a large extent by the environment, but not entirely. Now, this makes it sound like a very unbalanced system until you remember that everybody is both a supplier AND a consumer. Thus, given the most control, it translates into the most personal freedom and also the most personal responsibility, which best replicates the natural world, only optimizes it for human betterment.

That is why everywhere capitalism flourishes, people grow wealthier, more educated, and more healthy--ALL the people.

Confident Learner Joined: Jun 09, 2008 Posts: 68

Nadaav wrote:

That is why everywhere capitalism flourishes, people grow wealthier, more educated, and more healthy--ALL the people.

Well basically not in capitalism the health tends to deteriorate because of multiple factors.
Lets start looking at the American private mad care system I can’t believe that people need to get credit to pay of basic needs , I’m after one knee operation where I needed to give some extra money and some incidence where I got it fixed for free. And I’m from one of thus civilized countries with socialized medicine.
Some may look for hidden variables in my example and I’m not a fan of them because they tend to be obscured buy multiple factors so lets think of a simulation.
Lets imagine 2 firms both of them give the same services however one makes this for the lowest possible price and the other for insane profits now who is going to have the bigger profits ? The second one. Who haze more money for advertising ? The second one.
Do you think a company that creates Medicare for the smallest possible price and is honest can win in a market that is driven via commercials ?
Lets look at all the fancy brand shoos for a answer they are overprices shit with a fancy logo so are people buying from the honest producers who make the same quality or from Nike + friends ?
Well people are idiots and believe commercials and because this makes the most profit its not going to change its something that you can put this next to “Giffen Paradox” (http://en.wikipedia.org/wiki/Giffen_good) and "Snob effect" (http://en.wikipedia.org/wiki/Snob_effect) if you study economy like me you understand.

Lets consider products that are harmful to peoples health like cigarettes commercials tell people to smoke them do you think this is going to help the health of people ? Or some other product that is harmful yet addictive and consumers buy it do you think a firm is going to say “o this is harmful we are going to stop producing it” or are they going to ignore this and start challenging the opposition because its going to damage profits ?

To the rest can you demonstrate how people can gain in capitalism ? Can you describe a sterile laboratory situation assuming all other factors unchanging how its going to work ?

Grand Poster Joined: Apr 22, 2005 Posts: 1033

carx wrote:

Stuz719 wrote:

(Saitou - I think you meant to quote kmisho.)

Carx - on the subject of titanium. I see no reason why you shouldn't regard this as "real money", provided that all participants in the market recognise it as having some value in terms of goods and services.

The key thing about it is its scarcity - using a less scarce resource as a medium of exchange lowers its value.

For example, that using labour as a currency ("Give me a kilo of butter and I'll dig your field") in China is very different than in New Zealand ("Give me TWO kilos of butter and I'll dig half your field") because of the abundance of supply in the former compared to the latter.

Well thank you Stuz719 your the best poster I encountered.

I understand that is something is scares its value goes up .
However is “real money” necessary something material ? Cant it be something like fictitious points in a computer scoring system ?

Possibly, provided that all players in the market recognise the value (why not use inventions, for example?) of the intangible and - crucially - the benefits of cheating (i.e. claiming to have more "points" than you actually have, or just giving yourself more "points" arbitrarily because you fancy buying something "expensive") are minimised/eliminated.

Otherwise you'll get hyperinflation and the currency is rendered worthless - think about the consequences of a money supply that is effectively unlimited. Hence a relatively scarce material currency (gold, titanium, diamonds) is desirable because it is so hard to fake and/or increase the supply.

Confident Learner Joined: Jun 09, 2008 Posts: 68

Stuz719 wrote:

Possibly, provided that all players in the market recognise the value (why not use inventions, for example?) of the intangible and - crucially - the benefits of cheating (i.e. claiming to have more "points" than you actually have, or just giving yourself more "points" arbitrarily because you fancy buying something "expensive") are minimised/eliminated.

Otherwise you'll get hyperinflation and the currency is rendered worthless - think about the consequences of a money supply that is effectively unlimited. Hence a relatively scarce material currency (gold, titanium, diamonds) is desirable because it is so hard to fake and/or increase the supply.

Maybe I don’t understand however It seams you are misusing the word “hyperinflation” , Hyperinflation is a inflation over 100% in other words the doubling of the money splay and beyond.

And it seams to be extremely dangerous to invest in a stabile currency deflation of scars materials is guarantied. After the deflation the returning of the money creates inflation. Depending on the circumstances of the system a gold standard can technically generate hyperinflation.

I understand you use the word hard to start producing for distinguishing fake from real ones is a point system maintain via the government included in this definition ? Can our current money system be named real money form your viewpoint ? Its hard to duplicate money if the government is the only producer.

Newbie Joined: Jul 16, 2008 Posts: 10

carx wrote:

Nadaav wrote:

That is why everywhere capitalism flourishes, people grow wealthier, more educated, and more healthy--ALL the people.

...Lets start looking at the American private mad care system...I’m after one knee operation where I needed to give some extra money and some incidence where I got it fixed for free...

Lets imagine 2 firms both of them give the same services however one makes this for the lowest possible price and the other for insane profits now who is going to have the bigger profits ?

Well people are idiots and believe commercials and because this makes the most profit its not going to change its something that you can put this next to “Giffen Paradox” (http://en.wikipedia.org/wiki/Giffen_good) and "Snob effect" (http://en.wikipedia.org/wiki/Snob_effect) if you study economy like me you understand.

Lets consider products that are harmful to peoples health like cigarettes commercials tell people to smoke them do you think this is going to help the health of people ? Or some other product that is harmful yet addictive and consumers buy it do you think a firm is going to say “o this is harmful we are going to stop producing it” or are they going to ignore this and start challenging the opposition because its going to damage profits ?

To the rest can you demonstrate how people can gain in capitalism ? Can you describe a sterile laboratory situation assuming all other factors unchanging how its going to work ?

your comments were very difficult to read but i will attempt to answer them as best i can.

first of all, the problem with american healthcare is not that it is private, but that it is insurance based. insurance companies act as an enormous middle-man, doing what they can to pay healthcare providers the least and charge customers the most. direct-pay experiements have been tried and have shown to work much better. and by the way, you can't get a knee operation for free. the doctors, surgeons, nurses, equipment, and operating space all have to be paid for. the question is who should pay for them--you, who needs the operation, or somebody else, who also worked hard for his money.

second, a firm offering lower prices will usually beat the competition. look at walmart. walmart offers lower prices than other stores in an area, so people prefer to shop there, and then walmart makes enormous profits.

third, i always hear this "people are idiots and believe everything they see in a commercial." are YOU an idiot who believes everything you see in TV commercials? it always seems to be "somebody ELSE is an idiot." if you are able to discern a good purchase from a bad one, why shouldn't anybody else be able to--and if they aren't, why should YOU have to pay for their bad decision?

as for cigarettes and other harmful products: the decision to buy and use these products is still up to the individual. nobody is FORCING them to buy them. also, in more developed countries, governments have implemented standards and controls over products like cigarettes and medicine. in the UK and the US, for example, cigarettes are restricted to people over a certain age and contain huge warnings about their negative health effects. in countries that are less capitalistic, often MORE people smoke, probably because there is less education to become aware of the damage smoking can do. so the answer is not to outlaw smoking or smoking commercials, but to become more educated so that you know what is good for you and what isn't.

after all, why should you take away somebody's right to try and sell something? EVERYBODY who sells ANYTHING does so to make a profit, and that is their right. the critical point is whether the consumer decides to make the purchase, and that decision should also be a free choice. that's what freedom is all about.

Confident Learner Joined: Jun 09, 2008 Posts: 68

Nadaav wrote:

your comments were very difficult to read but i will attempt to answer them as best i can.

first of all, the problem with american healthcare is not that it is private, but that it is insurance based. insurance companies act as an enormous middle-man, doing what they can to pay healthcare providers the least and charge customers the most. direct-pay experiements have been tried and have shown to work much better. and by the way, you can't get a knee operation for free. the doctors, surgeons, nurses, equipment, and operating space all have to be paid for. the question is who should pay for them--you, who needs the operation, or somebody else, who also worked hard for his money.

second, a firm offering lower prices will usually beat the competition. look at walmart. walmart offers lower prices than other stores in an area, so people prefer to shop there, and then walmart makes enormous profits.

third, i always hear this "people are idiots and believe everything they see in a commercial." are YOU an idiot who believes everything you see in TV commercials? it always seems to be "somebody ELSE is an idiot." if you are able to discern a good purchase from a bad one, why shouldn't anybody else be able to--and if they aren't, why should YOU have to pay for their bad decision?

as for cigarettes and other harmful products: the decision to buy and use these products is still up to the individual. nobody is FORCING them to buy them. also, in more developed countries, governments have implemented standards and controls over products like cigarettes and medicine. in the UK and the US, for example, cigarettes are restricted to people over a certain age and contain huge warnings about their negative health effects. in countries that are less capitalistic, often MORE people smoke, probably because there is less education to become aware of the damage smoking can do. so the answer is not to outlaw smoking or smoking commercials, but to become more educated so that you know what is good for you and what isn't.

after all, why should you take away somebody's right to try and sell something? EVERYBODY who sells ANYTHING does so to make a profit, and that is their right. the critical point is whether the consumer decides to make the purchase, and that decision should also be a free choice. that's what freedom is all about.

Well maybe I write so badly because I’m not a native English speaker Very Happy

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Well I meant referring to capitalism like presented in libertarianism of AC (or are you a OK with government intervention with really makes my argument void because you already stated that the free market is bad and needs intervention ) , however aren’t the company’s going to fight this government restriction ? Second of all you make good points however you missed the examples I gave you this isn’t something made up its stuff I need to learn because I study economy and its in the textbooks I need to learn. How is your explanation going to explain the existence of the Giffen Paradox
? Well I’m waiting and most economist would give you the Nobel prize if you could explain this Griffen Paradox away Razz

.

Remember medicine is not something you can boycott ,” o my arm got amputated well normally I go to the hospital and stuff however I decided their prices are to expensive so theta means I sating home “. Besides you simply don’t understand how firms work and why the a commutation of mass is helping them to grove this principal helped Ford to gain market share and the same process makes socialized medicine cheap for everyone. Simply if one person puts 1$ in a jar its not going to pay the 100$ bill however if 100 people put 1$ its going to play the bill. So with 50 people everyone needs to put 2$ and I think you are getting why socialized med care can be cheap if everyone is putting one dollar in the jar and we have 1000000 people we have lot of dollars.

I don’t understand how the insurance company haze something to say ? Simply take the prices from the pervades how moth costs a reattaching of a finger in the hospital ? Do you need to be insured in the USA? O and please give me some examples of working private mad care its not that I’m going to accept it for a fact because you tell me “it works because its shown to work”. Or better yet show me a prove a model explaining how its supposed to work (Yes we all know that circumstances can mess up the results in real life so lets simply simulate something that you are describing ) especially that hospitals are something that’s a good that you cant boycott (it’s a completely un-elastic good ) and explain the Griffen Paradox (I think you can connect the dots).

O and my analysis about people believing everything that’s on tv well thus are statistical dates how many non brand non advertised on TV products are sold compared to the advertised on TV ? Actually I don’t need to look this up simply go to the shopping center or think if TV is worthless and everyone is a genius and don’t believe in commercials then why are firms wasting money on them ? If one firm got extreme and didn’t advertise it would win in the free market according to you. Why isn’t this happening ?

Its nice to have a discussion with you could you address in your replays :
- Griffen goods
-The un-elasticity of private med care
-The Griffen paradox
-What you think about government intervention

Because sometimes its hard to understand my posts Razz

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Newbie Joined: Jul 16, 2008 Posts: 10

carx wrote:

Griffen goods
-The un-elasticity of private med care
-The Griffen paradox
-What you think about government intervention

the reality of the giffen paradox, and giffen goods, is debated. that aside, it still doesn't change the fact that yes, free-market capitalism is NOT a perfect system, but that in general it can be shown both in logic and in practice that government intervention is not a better alternative.

let's take fast food, which can be argued to be a giffen good. as the cost of going to the supermarket rises, poor people will prefer fast food since it can be comparable or cheaper than home cooked food. however, that is still their decision! should we make a law saying that the supermarket cannot raise its prices past a certain level? that would be not only an infringement on the right of a supermarket to determine its own prices, but would be very harmful on the economy, since that supermarket also helps other businesses survive--the ripple effect would be devastating.

health-care is unelastic regardless whether it is public or private. if you are poor and need an operation that the state will pay for, you cannot boycott the long lines or the lower quality of service offered at the state hospital. the difference is that in the socialized case, the money has been taken forcefully from one person and given to somebody else who did not necessarily earn it.

also, to address your paragraph about advertising, i never said that advertising does not work. it definitely DOES work, that's why it is a multi-billion dollar industry. however, people who protest advertising never seem to admit that it works on themselves. this illustrates that people, if they want to, can bring themselves intellectually to a point where they can resist the pressure to buy. everybody is capable of this. since they have the capability, they can be entrusted with the responsibility, translatig to more freedom both for them and for the advertisers. remember, advertising is not just a big corporation trying to sell something to a poor uneducated working-person. it can be a job application, it can be a demo tape, it can be a romantic overture, etc. should we make laws regulating what you can put on your resumé? should we make laws outlawing high heels and makeup, since these falsely alter the physical appearance of the person wearing them?

government intervention, even when the intentions are pure, usually results in tight restrictions on your personal freedom. yes, the free market is tough, it's a dog-eat-dog world, and some people will suffer. however, that's the way the world is, regardless of what government does. the thing is that when government intervenes, the people who suffer are usually the people who have worked the hardest, and the people who are repressed are usually the people who need most the chance to grow.

Grand Poster Joined: Apr 22, 2005 Posts: 1033

carx wrote:

Stuz719 wrote:

Possibly, provided that all players in the market recognise the value (why not use inventions, for example?) of the intangible and - crucially - the benefits of cheating (i.e. claiming to have more "points" than you actually have, or just giving yourself more "points" arbitrarily because you fancy buying something "expensive") are minimised/eliminated.

Otherwise you'll get hyperinflation and the currency is rendered worthless - think about the consequences of a money supply that is effectively unlimited. Hence a relatively scarce material currency (gold, titanium, diamonds) is desirable because it is so hard to fake and/or increase the supply.

Maybe I don’t understand however It seams you are misusing the word “hyperinflation” , Hyperinflation is a inflation over 100% in other words the doubling of the money splay and beyond.

Which is what you'd get if everyone could freely print money or award themselves currency unilaterlaterally.

carx wrote:

And it seams to be extremely dangerous to invest in a stabile currency deflation of scars materials is guarantied. After the deflation the returning of the money creates inflation. Depending on the circumstances of the system a gold standard can technically generate hyperinflation.

I understand you use the word hard to start producing for distinguishing fake from real ones is a point system maintain via the government included in this definition ? Can our current money system be named real money form your viewpoint ? Its hard to duplicate money if the government is the only producer.

The government isn't the only producer - there are forgeries (however hard you try to prevent them) in the system, and in fact a number of governments and central banks all producing currencies, which people trade between.

As long as their is a mutually recognised authority (or number of authorities) to limit the money supply and the level of fake currency entering the market is minimised there is no "need" for "government". Remember the Knights Templar issued promisory notes on behalf of pilgrims...

Posted: Sun Jul 27, 2008 7:02 am

Cygnus wrote:

Even if they had cancer and couldn't pay for it themselves?

Even in such a tragedy it is not the responsibility of people to care for others by force or coercion. You have not right to force others to keep you alive at their expense.

Cygnus wrote:

I think that healthcare is possibly the only thing that should be more available to everyone with less free market influence. Before you jump on me about socialized medicine, read some about France's healthcare system. Yes, their doctors get riled up about socialized medicine, too. The problem with healthcare in this country is that we have made healthcare too much a capitalist enterprise.

You are entirely wrong. It is where government interferes with the free market where things become more expensive--this is true for more than just health care and coverage. Are you suggesting that there was less free market in the past when health care coverage was cheaper than today? I think you'll find there has been an increase of government interference as time has passed.

Cygnus wrote:

It is often very expensive and health insurance providers frequently screw people over on coverage in order to get the most money. Lawyers have made a mess of it too, suing doctors over every little thing and further driving up the cost of healthcare and health insurance.

I agree with you about the lawyers. We shouldn't have to turn everything over to the government to do something about that.

Posted: Sun Jul 27, 2008 7:04 am

carx wrote:

Saitou wrote:

carx wrote:

but not for necessities or anything that it could be argued that people deserve just for being people, such as medical care.

Medical care is not sunlight or some magical unlimited resource--it is the work and skills of people. Nobody can "deserve" or be entitled to the work and skills of others.

carx wrote:

It only seems to be working reasonably well for these things right now because the barrel of capitalism is nearly empty so there is a lot of fluidity for those who reside in the barrel. But if the barrel filled up, capitalism's impotence in the face of fairly distributing necessities would become readily apparent.

"Fairly" is an idea unique to the individual. I find capitalism much more fair than some government body deciding what someones work is worth to someone else. The seller and the buyer do not need a middle man swinging his "fair" bat to make a trade beneficial to both of them.

Hey why is it that you have written quoting me and I never wrote thus words ?
Please be careful while using the quote function.
Can you fix this ? You are literally putting words in my mouth Very Happy

.

I am very sorry that I made a mistake here. I tend to post in a hurry.

Graduate Thinker Joined: Mar 26, 2008 Posts: 513

Quote:

Are you suggesting that there was less free market in the past when health care coverage was cheaper than today?

This is probably because lawyers tend to drive up the cost of healthcare. You already agree with me about that.

Here is an article in Business Week about Fance's healthcare. While not perfect, it still came in first place in the WHO's ranking of healthcare in 2007 while the U.S. came in 37th.

http://www.businessweek.com/magazine/content/07_28/b4042070.htm


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