US GNP

[Jim Williams]

From BEA tables
Personal Consumption Expenditures 2005
Durable and Non durable Goods combined $3,572,400,000,000
Services $5,170,000,000,000

Contention: If we don't spend money on goods, it's not available to pay for services

difference -$1,597,600,000,000
divided by US population
of 300,000,000 -$5,325.33 per American

We borrow from China and buy their goods. China's GNP is in a balance we are not.
I'm 60 years old. I'm glad my patent helps balance the difference. So would a Bessler's wheel. I'm not so thrilled on what my generation is dumping on youth either.

If my contention is wrong, I'd be more than happy to hear about it.

[terry5732]

If you spend money on goods, you have spent it. It is not available to pay for anything else.

If you have spent money on services, it has been spent. You cannot spend it again. The service provider who recieved it may spend it on whatever he pleases.

How can an adult be so confused?

If you spend $1000 this week, someone will recieve it. If they do likewise, $2000 will have been spent in two weeks. But you only seem to see $1000. This amount at this rate would be $500,000 of economic activity in a years time. If you had put it in the bank it may be $1002 by years end. Buy gold and at years end you have $1000 if you're lucky. Even if you borrow the money to spend it, spending generates growth. If to many put that $1000 in their pillow it's called a depression.

[winkle]

but how does leting that 1,000 dollars spent and allowed to grow into 500,000 in a years tine in China do any good in the U.S.

they still have our 1,000 dollars no mater how large it grows

why do you think countrys are starting to dump dollars for euros

why do you think China is doing so well and we are up to our butt in alligators

[Kirk]

http://video.google.com/videoplay?docid ... 2978336967

he tells why the dollar is used to trade in oil.
Fascinating video.

[Jim Williams]

I believe there is a difference between money spent on productivity, i.e., goods, and money spent on services. Productivity is generated from natural resources be it iron ore, copper, gold, timber, tomatos, wheat, beef, etc. Service money is generated by one human performing a service for another human who already has money to pay for the service.

Where does this money come from? I believe it is generated from the translation of natural resources into products and produce and from no other direct source. Scott's reference to how cash is made out of thin air is an excellent example of how money is made indirectly, but it doesn't answer the question where money came from in the first place? From which it can be augmented by just printing more dollars. Remember the gold standard? Without products and produce we all starve to death because there is no means to do anything including offer or pay for services.

Service is all human to human. Productivity is all natural resources to human. It's from the natural resources alone we can get money. It's only from this money can we pay for services. We can print more money than we have yes, but we must one way or another borrow on that money to print it at the same time. I'm not quite ready to thank the Chinese for loaning us money from their own productivity. Again, where does that money come from except from natural resources translated into products and produce? Productivity alone pays for services. Pardon me while I sink into senility.

[Jim Williams]

Jim_Mich's point is well taken as well. Money is spent service to service increasing the total amount spent on service, which would not be reflected in productivity. I find myself answered.

[scott]

E.g.
I write software for a living. It is a service. By doing so I produce value and earn money that does not come from consuming any more natural resources than I would otherwise consume just by living and doing nothing. How does this fact fit into your equation where all "real" money can only come from natural resources?

I would argue that "real" money comes from printing presses and computer account balances which are wholly owned and operated by the Fed. Any spendable dollar is real enough.

When you talk about money, remember you are actually talking about the "money supply" or M3, which is a commodity like any other, except that it has been growing and accelerating "for free" ever since Nixon dropped the gold standard. In fact the Fed recently stopped reporting M3 altogether, for stated reasons that were controversial and imho fishy.

By monetizing debt (artificially increasing the money supply), government not only levies a hidden tax (by decreasing the value of each dollar held by citizens), but also makes obtaining credit easier than it should be. I'd bet that the -$5000 per American you're asking about is actually debt loaned out as cash, mostly through (bogus) home equity loans.

-Scott


P.S.
http://mwhodges.home.att.net/

[Jim Williams]

Scott

First, your Grandfather Report link is very good

Secondly, rather than saying productive money is "real" and service money is somehow "unreal", what I'm doing is saying there is a difference in values between productive and service money.

To me productive money from manufacturing and agriculture is of inherent value while service money is of implied value. Without doctors and lawyers, the world is a far more miserable place to live. But without farmers and iron ore miners there is no world at all. Cars and food are of inherent value. Movies and Pro athletes are of implied value.

What I'm saying is that money is nessisarily first a reflection of inherent values. That the basis of money is manufacturing and agriculture alone, without which there would be no life or money at all. What I'm not saying is that although productivity determines the existence of money, service is of no value.

Jim_mich's point was a good one. If a farmer were to pay a dollar for a movie rental, the rental company may have paid a dollar a movie for advertizing the rental company. Not good business, but in BEA figures the farmer's dollar would have shown up once, while the rental company and advertizer would both show a dollar and in services numbers would show up as two dollars. That's where some the excess in service dollars is coming from, making the BEA figures not reflective.

I'm out of libray compuer time. I hope that helps

[winkle]

i may be a fish on a mountain top here

i may be wrong

but

we went off the gold standard just so the printing presses could run at full speed

if or when times get real bad i think you will see that gap you'r talking about disappear real quick and it wont be much fun

hope this don't make me look any dumber than i usually do

[Jim Williams]

winkle
The only time I worry is when implied values are taken as inherent values. That's fascism, when service is as inherent in value as productivity.

[terry5732]

Value is, regardless of the commodity, the amount someone will pay for an item.
I am not a sportsfan and athletes have no value to me. But many are paid ridiculously because they have value ( they bring in revenue) to owners of sports teams.

Iron ore in the ground (your hard commodity) is nearly worthless. Mining (a SERVICE) increases it's value. Refining ( a SERVICE) increases it further.

Corn sells today for about what it did per dollar in the 1930s (when we were on the gold standard).

When a bushel sells for $5.00, it is not just that the corn is worth that amount, but also that the $5.00 is worth a bushel of corn.

What you really seem to be hung up on is YOUR valuation of certain items. I don't like lawyers either. But if paying one a large fee brings me more than what he costs, then he has that value.

To suggest that certain people YOU don't value are valueless is rather narrow minded if not elitist.

I will happily pay postage for any worthless currency anyone wants to send me.

[Jim Williams]

Terry 5732

Sevices are always performed directly for another human being. Your lawyer example is a good example of the IMPLIED value a lawyer can have.

I used a double negative in defining productive vs implied values. What I meant to say is that both productivity and service are of value, but one is of inherent value and one is of implied value.

A iron ore miner, since he not performing his work directly for another human being, but performing it for iron ore, has inherent value and is not a service.

[Jim Williams]

I moved to San Francisco thirty years ago after returning from Spain, where I was living in the home of a retired Fascist Coronal in then still Fascist Spain. San Francisco is a mostly service economy in which I've worked, but am now a starving inventor. I am undoubtebly elitist when it comes to productivity vs service. I've lived thirty years in "Hollywood" and am attempting to escape to the farm.

My point in all this GNP stuff is from that I remained convinced that efforts in productivity contribues to the entire economy where all service is dependent on that same economy. As a result we will lose to China in the long run as they are a productive economy and we are becoming more and more a service economy.

I note Bessler's wheel is of that same inherent economy that contributes to the economy and I am all for anyone that can develop such an invention. I think such a wheel that will change Earth. But I am a snob who thinks productivity is better than service, but that's only for me. As this post has nothing to do with anything, I'll stop my ranting and raving.

[scott]

I would argue that "information" is just one example of a valuable commodity that comes from human beings alone and not from any particular natural resource. Even if we all lived on self-sustaining farms, information would still be valuable.

[Jim Williams]

Scott

I agree entirely that information is valuable and that it is of human generation alone vs being a natural resource like coal. I'm only arguing there is a difference between inherent vs implied values, not that either isn't of value or even one is nessisarily of more value than the other.

I have trouble being sure if either information or energy is of inherent vs implied value. Gasoline is a good by BEA terms, but gas and electricity are services. BEA Table 1.5.5