81 comments on “Praxeology – Episode 15 – Money”

  1. Goodatconnect4 says:

    Please keep up the great work, praxgirl. I just had an argument regarding the "invention" of money and indirect exchange the other night.

  2. samargull says:

    Thank you very much Praxgirl. And Merry Christmas. I am looking forward to episode 40 sometime in the New Year. You Go Girl!

  3. Alexander Chudesnov says:

    Merry Christmas to you, Praxgrl 🙂 (or just happy holidays, if you prefer)

  4. DigitalShaolin says:

    So sexy! And informative.

    Question for you. Who do you consider the greatest economist of all time?

  5. Savvy Symbiont says:

    Why would a baker want a sword? You're examples need a basis in modern reality in order to have any educational value. This goes for all levels of education from k-12 and into higher education. Confusing the student with misrepresented reality causes a loss of value in what you are offering as an educational product.

  6. jskelton440 says:

    @savvysymbiont What an incredibly fallacious argument. Please tell me that you're not actually in education.

  7. Frank Flores says:

    When the supposed good that becomes the medium of exchange is imaginary, then we accelerate our own destruction. Stop promoting monetary values and begin focusing on the resources and social relationships that are the basis for a better world for all people.

  8. Chet Lake says:

    @savvysymbiont What? How is that confusing?

  9. Marcus Aurelius Antoninus Augustus says:

    @ Praxgirl, are you going to make a video about the zeigest style 'resource based' economy ? I have people on the internet who are wrong that I need to argue with.

  10. triforcelink says:

    @wacabby Create a system where people have an incentive to share, and you will have your 'resource based' economy.

  11. rumco says:

    @savvysymbiont Face palm.

  12. carlosjhr64 says:

    I think this is your best video yet.

  13. gergenheimer says:

    @savvysymbiont Human values are subjective – the point being that it is not your place to question the desire of a baker to want a sword. (I'm an artist, and I own 4 swords, btw) The fact is, if he wants and/or needs it, and is willing to trade his wares for it, he will increase his wealth by exchanging for it. The other point is to highlight the fact that a sword cannot be divided into pieces to facilitate exchange, at least not without rendering it useless as a sword.

  14. gergenheimer says:

    @wacabby the concept of a "resource-based" economy is a collection of age-old fallacies, dressed up in sci-fi trappings – I doubt Praxgirl would waste the time and resources on the subject, but if she did, I'm 99% sure it would be to refute the idea. Without a monetary system and the matrix of prices derived within that system, it would be impossible to efficiently allocate resources to their best uses – end of story.

  15. Manuel Barkhau says:

    @wacabby the most fascinating thing to me about "resource-based economy" is that those who advocate it are blind to communism by just another name. The exact same criticisms as were brought forward in the 1920's still against communism still apply. 1. Mises calculation problem. 2. Hayek information problem and of course the age old incentive problem that even they recognized.

  16. mikemat3307 says:

    bUT, BUT, BUT, TEH POST-SCARCITY!!1!!!!!1

  17. Goodatconnect4 says:

    @gergenheimer And, the resources for such efforts by praxgirl would be scarce and better allocated to other ends ;), like teaching praxeology.

  18. DreadsideNubune says:

    I SAW THIS WOMAN ON TV AND SHE WAS SITTING BEHIND A DESK AND SOME WOMAN GAVE HER SOME FILES AND THEN SHE TELEPORTED FROM BEHIND THE DESK AND WAS STANDING RIGHT NEXT TO THIS GUY FROM LAW & ORDER OR SOME OTHER SHOW BUT HE WAS A LAWYER IN THIS PROGRAM… BUT THE PEOPLE RECONGISED HIM FROM THE TV PROGRAM EVEN THOUGH HE WAS IN A TV PROGRAM… IT WAS SO CONFUSING

  19. EKEKOPE says:

    Get a productive job..

  20. Niki Wonoto says:

    Google: Resource Based Economy (RBE), Venus Project, Zeitgeist, and/or Paradism. They’re all might be different names, but essentially share the same (or very similar) philosophy & value, and the main thing is: to get away from the current Monetary system (and it’s NOT even about communism, if you study deeper about them).
    These might actually be the solution to many of humanity’s current interlinked & complex problems. Once again, it’s the System.

  21. Dean Elliott says:

    It sounds like you're summarizing Rothbard's What has government done with our money? :p

  22. Timothy Wenk says:

    Thanks for posting this. Learning from an extremely beautiful woman, is always a good idea!! 😉

    What's scary is, this is all not completely obvious to some (most?) people. I remember when (for example), perfectly "intelligent" people could NOT see WHY the site "napster" could not be allowed to continue. Boggles the mind!

    Cheers.

  23. Juan Estrada says:

    @nikiwonoto It is the system, and free markets are the answer. Austrian economics (an offspring of the praxeological method of inquiry) is simply an economic defense of free market. It is NOT a system, rather it is a theory on how free markets work.

    All that other stuff you listed is united nations propaganda. RBE relies on virtual free markets to determine distribution. Simply Complexity, by Neil Johnson, explains how a virtual free markets would work to determine distribution.

  24. Juan Estrada says:

    @nikiwonoto Thus, RBE would take us from one tyrannical system to another even more coercive & tyrannical system. The whole argument for a virtual free market system is a contradiction, it says "humans are irrational & cannot think long term, so we need humans to develop a rational system of resource distribution that's sustainable".

    Also, Johnson rejects the notion of an invisible hand as characterized by Adam Smith while ignoring the elegant characterization by Stuart A Kauffman.

  25. Juan Estrada says:

    @nikiwonoto And the most obvious flaw is, well human action cannot be quantified, as Mises has undoubtedly proved.

    A system like RBE could only work by force and would have to assume perfect knowledge of the past, present, & future. I don't even have to get into what a ridiculous notion this is. Even the perfect knowledge/approximations of the weather would be required.

  26. Matthew Alistair says:

    praxeology has never looked so attractive

  27. Set_Square_Jack says:

    2 dislikes? What is to dislike?

  28. KagarBeardtooth says:

    @savvysymbiont

    The Baker is also a Renaissance Fair participant in his free time. Pwned.

    P.S. It really doesn't matter what goods/professions she chooses to represent parties A, B and C in her Direct/Indirect exchange examples. All that matters is that the viewer understands practical the problems of Direct Exchange and the solutions provided by Indirect Exchange and Money.

  29. KagarBeardtooth says:

    but praxgirl wut abowt talley sticks?????

  30. surroscape says:

    please remove your shirt……….for science

  31. Ishpeck says:

    Blacksmiths do horse shoes and such. Swordsmiths make swords.

  32. MoneyIsSilver says:

    One of the best videos yet that I've seen on the nature of money.

  33. MoneyIsSilver says:

    Please pass this video on to people who have joined the Zeitgeist cult and push their "RBE" on you.

  34. Alex B. Paraipan says:

    @alistairproductions +1

  35. MillionthUsername says:

    I have a question, if there are any takers.

    Is it necessary to have a commodity money in order for a workable price system to arise? The question pertains to the possibility of a modern "barter" system which uses valueless trade credits (not pegged to $), in which case prices would represent rankings of all goods relative to each other and not one good (money) to every other thing. Can a ranking system produce real market prices, or are prices ultimately based on commodities no matter what?

  36. MillionthUsername says:

    @robertetaylor I'm not trying to argue definitions of money, just exploring a question I haven't heard addressed. In modern trade exchanges, they use credits which are merely substitutes for dollars. I'm asking a theoretical question about whether you could discover prices using a pure ranking system starting from scratch. I think you could, but I'm not sure. This is the only other possible way I can think of to price goods besides commodity money, and I don't know if anyone ever proved it.

  37. MillionthUsername says:

    @robertetaylor I don't mean fiat money/credit. I mean a "barter" exchange (it's really a step above barter) where you simply record A buying from B on credit: B sells a bike for 100 credits, so he is +100, while B is -100 and owing 100 in kind to the system. It's multilateral time-separated barter using no money. I'm just wondering whether you could price everything using credits to rank the goods. It still requires economic calculation, & real values are exchanged via the placeholder credit.

  38. MillionthUsername says:

    @robertetaylor Traders in the system have to rank the value of all goods relative to each other rather than based on the exchange value of one good – money. The credits are a judgment of value and a placeholder till the trade is completed. Since this is done in barter, I don't see a problem with economic calculation. In barter, a seller judges that his bike is worth 3 hours of a plumber's time or 15 chickens, etc. But this requires a clearinghouse to facilitate trade and keep account.

  39. MillionthUsername says:

    @robertetaylor I know what prices are. Are you trying to say that there are no prices in barter? That's not true. It's just that the ratios are not calculated using the same denominator (money), but every good is measured against every other good (in reality, the good at hand being traded for).

    Every pricing system starts with historical prices, but before money trade begins with barter.

    Why are you saying "value cannot be measured"? I'm not making a claim about objective value.

  40. sharperguy says:

    @DeanApril14 She's basically summarising Mises' Human Action which Rothbard used as a base for a lot of what he wrote, also making sure to explain the theories and not assuming his audience was already familiar with the arguments of Mises.

  41. sharperguy says:

    So you spend all your donation money on pies and swords, hmm?

  42. Julia Riber Pitt says:

    Sorry, but this is bull. Money never originated from barter. The "cigarettes in prison" scenario emerged only AFTER money did. The "original" money was debt, an IOU. Read Graeber's book on debt.

  43. Truth-In-Hand says:

    I buy everything except the "lonely teacher" part. I find it hard to imagine you would be at a loss for company. Good company might be the problem, but no doubt you must be beating men off with a stick. Good work, and keep it coming.

  44. Truth-In-Hand says:

    @juliaisafilmbuff123 Pffff! What?! Why read a book trying to prove that which is patently ludicrous? Anything used to facilitate indirect trade is a money. Debt may be used, except this merely renders the trade as un-resolved until the IOU is filled. The current collapse is proof that debt by itself is not actually money, it's a promise to pay a money. Where do people get this stuff….?

  45. Lea McIntosh says:

    Why spend 5 minutes explaining something that everyone already understands?

  46. Dean Elliott says:

    @littlelea86 If everyone understood money then we wouldn't have the problems we have now…

  47. MillionthUsername says:

    @robertetaylor Modern trade exchanges usually employ a dollar substitute which serves to set prices by mimicking dollar prices. It's quite easy to remove the dollar completely from this process, just as the dollar supplanted gold by hijacking its price system. But my question was about the ability of a pure barter system to establish prices without money. I think I answered my own question, but are you now claiming that prices can't be set through barter alone? That's what it sounds like.

  48. Josh Carter says:

    What is this bitch talking about ….. lol jk but seriously she's HOT

  49. forgetfulmuse says:

    @brohmbomber It's OK, she doesn't know either.

  50. Just Call Me Oscar says:

    Praxgirl I love your videos, but do you find any irony in that you're providing this service whereby millions of people can watch it for only the cost of a few minutes' time??

  51. gergenheimer says:

    @MillionthUsername it is important to note that all exchange, even when attenuated by a monetary system, is in the end, about exchange of real goods and services. if money's only function was to provide a unit of account, then credits would work as well as any other type of system. However, money, as just another good, should be grounded in real goods and services, because credit created arbitrarily out of thin air commands goods and services having provided nothing in return.

  52. MillionthUsername says:

    @gergenheimer I wasn't talking about creating credit out of thin air to act as a money. If I mentioned credits, I was talking about trade credits in a so-called "barter" (it's not really barter) exchange system where they typically use some stand-in for the dollar. I originally had a theoretical question about barter prices which I answered myself once I thought about it. This other person responded to me but didn't understand what I was saying, and that probably confused you too.

  53. AJ Gardner says:

    Great job with the videos. I remember a lot of this stuff from reading Human Action many moons ago. The fact that these are short and sweet is perfect; I'm going to encourage my girlfriend to watch!

  54. Praxgirl says:

    @aaronjgardner help me get more women interested in Praxeology! We're underrepresented!

  55. gergenheimer says:

    @nelsonrn You are correct that anything that comes to be accepted as a medium of exchange is a "money". But my point is, a good-quality money serves functions besides merely facilitating exchange. What's more, those pieces of paper in our pockets do not qualify as money under our definition – the unbacked paper money systems we have today were not chosen voluntarily – the only reason everyone accepts them is because superior, non-fraudulent forms of money have been made illegal.

  56. Truth-In-Hand says:

    @praxgirl No bloody kidding.

  57. Truth-In-Hand says:

    @CounterLeft Statists would love to make it sound like government is god, except kings and gold mines did not spontaneously appear on this planet, so you aren't actually working from first anything. You're starting your point in the middle and think you're debunking a theory of fundamentals. What an idiot.

  58. Wizdomtrek says:

    Very nicely done, didn't anticipate the caliber of the material presented. :))

  59. Truth-In-Hand says:

    @CounterLeft How do YOU explain it? I don't explain it, cause I didn't propose it. What exactly is the problem with money, anyway? If you're not pro-state, then an appeal to antiquity or ad populum is doubly useless. These theories can be recreated and tested today, and they are, ever day. But let's cut right to that: what the thesis against money?

  60. Just Call Me Oscar says:

    @nelsonrn Aha!! Very true!! 😉

  61. Truth-In-Hand says:

    @CounterLeft What exactly is the criterion for the definition of money as you are using it here? If you watch the video, the criterion is anything that is used to facilitate indirect exchange is acting as money. So, under that criterion, yes, you absolutely can test money creation, at any time and under any circumstances.

    But what does the state have to do with money creation? The state is not all-powerful, and people trade indirectly all the time, using many mediums.

  62. Truth-In-Hand says:

    @CounterLeft Again, I take money to be anything used to facilitate indirect trade. But this point of debt absolutism and that debts do NOT at some point have to be paid, is idiotic. Debts can certainly be renegotiated, but this is just putting payment off, not proving to be unnecessary. Debt is not a money; debt is an agreement of an obligation towards someone to be satisfied with money. Indefinite refinancing of any deal is why 2008 was a hellish year, and why we're STILL F'd.

  63. Truth-In-Hand says:

    @CounterLeft Eeeeeeexactly, thus proving that debt, in and of itself, is not a replacement for value. "Debts were forgiven" doesn't mean that goods didn't change hands. You just can't have debt based upon itself as money. Credit can only come from the surplus thrown off by the subjective value principle. Person A values object 1 more than object 2, which he has. Person be has object 1, but values 2 more. Both net a profit by trading. Continued….

  64. Truth-In-Hand says:

    @JaceJohanson "crado" meant "to believe." It takes a foundation of previous trustworthy interaction on the basis of money to give rise to extending another party a line of credit. Who gives credit cards to people with tanked credit scores? Why would they? Promises, whether of payment in a monetary scenario, or promises of showing up on time to pick of your kids, are only as good as the record proves them to be. Continued….

  65. Truth-In-Hand says:

    @JaceJohanson Why did the housing crisis happen? The conditions were set to allow irresponsible lending to untrustworthy people who over-extended themselves, by untrustworthy banks. The wealth of humanity is measured in the level of it's character, through the barometer of money, because only money illustrates how two strangers can conduct trustworthy trade with each other without requiring any prior interaction or mention of future interaction. Credit is purely abstract.

  66. ronwandell says:

    I love Praxgirl 😉

  67. Ryan P says:

    @praxgirl where did you learn all of your knowledge on praxeology?

  68. Mark Proffitt says:

    There are 15 Alternative approaches to achieve any goal. There are 3 indirect Alternatives. So there are 12 other Alternatives, and several of them are much better than indirect.

    For example: If information were easily compared (such as through the internet) direct exchanges could be organized without any indirect exchange.

    Another approach exists when technology advances to the point that they can make what is desired without anyone else. This causes 2 possibilities: self made or gifting

  69. Daniel Tower says:

    Stop being Hot!!! I can't listen to what your saying… perhaps you can make a lesson based on that! all I heard was pies, swords and something something

  70. Carter Cole says:

    15 videos in and you finally mention it

  71. Artemis Wyrm says:

    10 socialist

  72. syed shah says:

    Money is a confidence trick if you think about it.

  73. Robin says:

    How would the concept of inflation play into all of this? Or do you explain that in a later episode?

  74. cowboy1165 says:

    Hey praxgirl. I have a handmade scarf to trade for your lessons. I acquired it at gunpoint when some guy pulled a knife on me.
    This is a great introductory to Praxeology.You're doing good.

  75. Diego275 says:

    nice girl, pretty

  76. TheAngryCanary says:

    Hey. I doubt there is much of a chance you will see this comment… but if you do. I am a former nuclear machinist mate of the United States Navy (this means I'm not an idiot if you know what I mean). I made a video called 'redefining money' where I proposed what I feel is a clearer definition for the word 'money'. It clearly delineates it from the word 'currency'. I've had great success explaining monetary concepts to people with this definition. I'd appreciate it if you took a look. Thanks

  77. karma tinfoil says:

    Wow, this was an ok lesson on how we got here, but let's be clear: mechanization is crippling capitalism everywhere & will continue to do so. Why use money(other then to control people)  in a society that could make anything, for it self, using 3d printing techniques. Have you ever heard of fully automated vertical farms or farmscrapers? These things when finished properly, can crank out food, daily, for free! There by decoupling people from the need of money to exchange for that which they need to survive.

  78. Sam MacInnes says:

    http://socialdemocracy21stcentury.blogspot.com/2012/02/money-as-unit-of-account-and-its.html

  79. Perry Gruber says:

    This is standard information from basic economics. It is also completely, historically incorrect. David Graeber and a host of other anthropologists have debunked this old story about how money was created. Money was created along with markets as a way for rulers to finance expansionist campaigns and wars. Adam Smith created a fable about barter and coincidence of wants in order to propagate his “economics.” We have all swallowed that fable ever since. Anthropologists have been unable to identify, through their research, a single community that used barter in the way you’re telling it, which is the same way Adam Smith told it so long ago. David Graeber, an anthropologist who also is a professor at Cambridge I believe, wrote a fantastic book called Debt: the first 5,000 years, gives ample evidence that societies prior to the creation of money, debt and markets (and government) were SHARING economies, not barter economies. Kings and Queens of the Old World decimated sharing economies that existed in abundance. Their main tool was money, supported by markets and military force. They set up markets where “savages” lived, forced them to use money rulers created to buy products which were taken over and controlled by representatives of those rulers, while taxing the producers of those products AND the consumers. The money collected through taxes was then used to pay soldiers, and to buy war materiel for their armies. All this is plainly and in great detail explained in Graeber’s book. You should read it.

  80. Júlia Menezes says:

    i love youuuu!!

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