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**Badger** · 10-12-2008, 08:02 PM

well what are you going to accomplish with out energy input?

**Austrokiwi** · 10-12-2008, 10:49 PM

As I said I am not saying energy isn't involved but rather I am challenging the appropriateness of a definition of money involving energy. The best definition I have ever found for money is from a reprint of the book Maria Theresien Thaler by Carl Peez and Josef Raudnitz first published in 1898. The reprint is in Social Research on Africa Db 5 1998, and in the introduction by Werner Biermann this definition is given:

..... "Money is a social convention "a machinery for doing quickly and commodiously, what would be done, though less quickly and commodiously without it." ( apparently this is a quote from John Stuart Mill). Biermann goes on to clarify the quote........ "In other words, Money is to enable buying to be separated from selling, thus permitting trade to take place without the so-called double coincidence of barter".

I think this definition is far simplier and describes money accurately without the inclusion of any reference to energy.

Under this definition I believe some of Lietaers complimentary currencys might be challenged as to whether they are actually money, to me they seem to be a subtle return to a barter system albeit more sophisticated. Lietaers definition is as follows:

"Money is an agreement, within a community, to use something as a means of payment." Future of money page 41 (paperback version)

Lietaers definition could apply to barter exchanges and therefore IMHO Biermans emphasis on separating selling from buying is important in distinguishing a monetary system from a barter system. For example:

Lietaers definition would define cigarettes in a prison as money. This is accepted in many circles but I would note cigarettes are a commodity that have a separate purpose and can be consummed and therfore are not separate from the barter economy they operate within (a prison).
Frequent flyer miles would also meet Lietaers definition. I know many describe frequent flyer points as money however frequent flyer points do not have the full transferability that many of us expect of money and many frequent flyer systems now have a retirement system to take unused points out of the system after 2-3 years. Frequent flyers are more of a consumer loyalty system and barter loyality for flight benefits.

A final note when I started buying gold in 2002/2003 I started to be intriqued by what money actually is and spent some considerable time researching definitions and monetary systems. After 2-3 years i knew a lot more about monetary systems but still had not found an adequate definition of money. In the end Biermans explaination resonated better than any other as it, IMO, met the requirements of Occams Razor.

From Wikipedia:
"All other things being equal, the simplest solution is the best." In other words, when multiple competing theories are equal in other respects, the principle recommends selecting the theory that introduces the fewest assumptions and postulates the fewest entities. It is in this sense that Occam's razor is usually understood.

Don't get me wrong I may challenge some of Lietaers definitions but his book is a wonderful exploration of how society may move forward and how monetary systems are an important lubricant or brake on human transactions.

**drelly** · 11-12-2008, 08:19 AM

Money is the currency we use to put a price tag on something whether it be labour or the fruit of labour. Labour of course requires weetbix, which requires land, weetbix seeds, machinery, more labour and energy to run them all. So while I understand that energy is behind money. It seems to me that this connection, while not always acknowledged, is an intrinsic part of our understanding of money.

A: "Your weetbix costs more this week because petrol prices have gone up"
B: "Oh I see, well, I can understand why."

I don't think it's that people lack an understanding of the energy cost in relation to their day to day lives, it's more that there is no general public understanding of the real energy situation or where we're likely to be in 10 years time. So many opinions and not much consensus.

There was something on the news a couple of days ago about these new, wonderful electric cars and they were saying how ideal they were for NZ with all our hydro-electric power generation. With all the problems we've had with brown-outs and unreliable rainfall, I wondered whether either of them had actually lived here!

**Badger** · 11-12-2008, 11:44 AM

Whats that electric car fabricated from again? Not those pesky resources...

If we all owned electric cars there wouldnt be enough power left in NZ to do anything else except charge the car's and sit in the dark...theres not enough generation.

Up there with bio-fuel's negative EROEI.

Austro ill get back to you ive read that piece before...

**Badger** · 18-12-2008, 11:12 AM

Austro it still takes energy to produce the cigarette no matter its end result whether its as a tradeable good or for smoking enjoyment...

**Austrokiwi** · 18-12-2008, 07:22 PM

I can't argue with the fact that Energy is an important part of the economy, well life really! Energy is important to us in much the same way that all of us are addicted to Oxygen ( no ones found a cure for the withdrawal symptoms yet

). I fear I am repeating my self: MY proposition is energy is an unnecessary entity within a definition of money as per Occam's Razor. My points have been in reaction to Drellys post in which he said:

I already said this in another post but money is in effect, just a portable, tradeable, generally accepted representation of energy so I can understand why there is the focus.

IN this quote I understand Drelly to say that Money = Energy

Hypothetically:

In an economy where the world has successfully developed Fusion technology, or cheap fuel cell technology the cost of energy will likely be cheaper than it is now. Further more with such technology energy no longer becomes a limiting factor in the economy, If energy is an important component of money, as I understand Drelly to be saying, then in such an environment the development of cheap plentiful energy would be akin to printing more money and the economy would experience substantive inflation.

Clearly the idea that cheap plentiful energy would create inflation is counter logical.

Also in the world economy there is not a direct relationship between the amount of energy expended and the money earned, indeed at times there may be an inversely proportional relationship. Look at the amount of energy expended by a labourer or a farmer per dollar earned. Compare that to the amount of energy expended by a lawyer or a CEO per Dollar earned. I suspect in some cases, Not necessarily all, the labourer and farmer will expend far more energy for each dollar earned than a more knowledge based professional. {This is one of the reasons I find it bizarre that Legal firms and similar proudly claim they are carbon neutral: they are a knowledge based profession so of course the energy component is lower than production based professions}

**Badger** · 18-12-2008, 08:19 PM

I see it the other way around and I think mayby what Drelly meant that is

Energy = money or unit of exchange

Clearly the idea that cheap plentiful energy would create inflation is counter logical.

Not at all since the cheap energy thats been subsidised has been a backing behind unfetted dollar creation - petro dollars

The rest of your statement is what I call a *market imbalance* bought about by central planning and manipulations in different markets globally by vested interests!

Its like a uneducated rugby guy earning $250k a year compaired to a nurse who makes $50k...

The nurse is a far more valuable to society than a overpaid ditch digger playing a rugby game, thats a market imbalance...

An IT guy straight out of school can start on $40k shifting pixals around. A builder makes say $38k-$60k and has to front most of the stuff to make the job happen. Again thats a market imbalance not helped by the current enviroment of business.

Basically many so called profesionals are over paid IMO and live out side their means for what they actually do. Which seems to be tinkering with stuff, then get a fat payout known as a golden parachute, then theres some music and they all shift round the deck chairs...

The economy is directly effected by the amount of energy expended, less energy expended less growth less money creation less consuming mmm that all sounds familiar...

**Perry** · 21-12-2008, 09:12 AM

I agree to say that money = energy has the potential
to be misleading. Light a pile of $5 notes and I suspect
that one wouldn't be warm for long!

It's a symbol that - most times - people accept and
recognise as a token, used to trade with others as
a way of buying their energy. Be that labour or goods
which are the product of previous energy-expending
labour.

If you give my this much money, I will provide you
with this much energy (force applied to an object)
and I, in turn, can use that money to persuade some
other person[s] to provide me with xxx of energy.

**Steve Netwriter** · 16-01-2009, 07:48 PM

MAY 1999: SPECIAL FEATURE
The Future of Money
From Global to Local
extracted from the May 1999 newsletter

Keynote speech by Professor Bernard Lietaer, designer of the Euro and complementary currencies expert, delivered at the LETSLINK UK Complementary Currencies Conference, October 16, 1998
(Transcription and editing by Jan Wyllie)

Papers: The Future Of Money

http://letslinkuk.net/papers/1999-05-Lietaer.htm

My perspectives

I have been looking at money for 25 years from many perspectives, through my careers in central banking, currency speculation, financing developing countries, in academia and business. Every time I have been exposed to a different dimension of money, and have had to change my whole view of the money system. The beings that know the least about water are the fish. We are all fish when it comes to money. It therefore takes an extraordinary effort, or luck, to see the whole picture.

Topics to be discussed

My first point is remarkably similar to the point made by Jan Wyllie, the previous speaker. I would say it is amazing that coming from such different backgrounds, we have actually, without coordinating or agreeing, ended up with roughly the same analysis ÷. The second point I want to talk about is the role of the many different types of complementary currencies. LETS is the 'Bible' in the UK. But there are many other different forms operational elsewhere, from which we can learn.

I will have also three proposals.
1. It is time to go mainstream, come out of the margins and work at the level where changes are being made, because we will be propelled into that position by the troubles in the main system. Let's not be reluctant to press home the point.

2. The second has to do with using the demurrage system in developing truly sustainable complementary currency systems.

3. And finally I will propose the formation of an automatic clearing house for complementary currencies using the Internet.
.
.
.
Today, in 1998, my latest database has 1650 complementary currency systems operational in the world. [As of February 1999 there are over 2.000]. Britain was not quite the pioneer, but definitely has the largest number.