Yes, but the Constitution forbids the states from interfering with contracts under Article I, Section 8. It also, in the Tenth Amendment, does not grant that power to the federal government, so it clearly and unambiguously follows that the power to enter contracts is left to the people.

What is wrong with the Supreme Court, that it cannot read the Constitution?

I don’t think Mises would agree with you. In his own words:

“It is not the task of catallactics, but of psychology and physiology, to explain why people are intent on
securing the services which the various vendible commodities can render. It is a task of catallactics, however, to deal with this question with regard to money. Catallactics alone can tell us what advantages a man expects from holding money.”

So you are not conducting Misesian economics with your toaster example. Yes, people have specific reasons for securing the services of things, but this is the job of the psychologist to sort out, not us. Furthermore I can explode your example by pointing out other objective psychological reasons than toasting for demanding a toaster:

from a consumer perspective:
to fill up a kitchen for the sake of appearance
to make a girlfriend/wife/mother/partner happy
to kill someone by throwing in the bathtub when they are taking a bath

from a merchants perspective:
as good held not to be used but exchanged down the road (no merchant actually values the toaster because it can toast. He buys it to sell it later.)
an attractive filler on store shelves to help sell higher margin goods

But as Mises says, economics doesn’t care about any of these reasons. All it cares is that people have reasons, even though these reasons may be multiple and different.

But why does Mises believe that economics should avoid “psychologizing” for all goods save for one – money? I’m open to any good explanations for this.

Ktibuck: “So you see there are two types of things in this word rtr. There is money and there are goods.”

Mises: “‘Media of exchange are economic goods. They are scarce; there is a demand for them. There are on the market people who desire to acquire them and are ready to exchange goods and services against them.”

Money are goods. Nuff said.

I didn’t say that the reasons were identical from one person to another–I simply said there are reasons, which implies some kind of rationale behind those reasons, so no, those reasons are not random, even though there is a variance in the reasons. And subjective valuation may be based on reasons, but is not the same thing as those reasons. Two people could have the same exact reasons for buying the same toaster, or kind of toaster, but still subjectively value the toaster differently, if only because of their different circumstances.

People define, categorize and differantiate between things because it helps them to cope with reality.

Yes, both apples and oranges are fruit. But they can be differenatiated on some level and this differantiation is helpful. It helps us understand the reality we live in.

Also you can define a chicken as an animal, or as a bird or as an economic good. All these definitions are true and helpful.

In economics you can differentiate goods and money by their function. Or you may choose not to, just as you do.

But if you don’t differentiate you can not understand why wealth doesnt really increase when the amounf of money increases, or why people don become poor when zeroes are removed from currency.

I am repeating my assertation. If, somehow every money holder lost half of their money over night, the amount of wealth wouldn’t change. Not for any individual, and not for the society as a whole.

Any other goods destruction is clearly a destruction of wealth. But that is not the case when it comes to money. That is the only reason we differentiate between money and goods. Or that is why we call the function of something, money. Just like according to some reason we call some fruit, apples.

Money has a unique function. It has unique characteristics. It is valued on different grounds, and the amount of is irrelevant.

Also what you keep calling marxist use value is in fact called, utility in economics and it is the basis for value.

Every thing is valued based on its utility and moneys utility is its ability to exchange it for all the goods in the economy while a goods utility is the ability to satisfy human needs. You accept money because you know it will be accepted by others. You accept goods because you know they can somehow satisfy your some need.

That is an absurdity. Nobody would “buy” (epistemologically *trade*, which also simultaneously includes “sell”) toasters in such a scenario precisely because the reasons would be *different* by definition of trade. If the reasons were the same, if the subjective value was the same, there would be no trade. There’s a reason for the forthcoming title, “Strict Barter: The Epistemological and Economic Implications of Trade”.

Michael A. Clem: “As I’ve said before, subjective valuation doesn’t occur in a vacuum, and it isn’t random.”

It indeed does occur in an extrinsically determined subjectively valued vacuum, and it indeed is random by definition of it being subjective and not objective.

Michael A. Clem: “Money is a means to other ends, not an end in itself.”

All Action is a *step* to other further temporary “end” steps, not an end in itself.

Michael A. Clem: “Mises himself says not merely that man acts, but that man acts for a reason, to remove some discomfort or dissatisfaction.”

Man acts for *subjective* reasons, not instinctual “objective” non action reasons.

Nobody values the same things for the same reasons. Everybody values the same things non constantly differently for non constant different reasons. This is seen by different ranked preferences, by different choices. For example, by definition of two people being exclusively married, no other persons can have a marriage with either of those that man or that woman, without by definition changing subjective value preferences of that man or that woman, without by definition changing reasons. All trade is by definition a changing of reasons, a changing of preferences. Trade is action. Trade is expressed preference. Trade is no longer being “married” to possession of a good, to borrow some stock trading lingo.

ktibuk: “Take a billion dollars to deserted island with you and you will see it is not wealth when you starve.”

You can say that about a plethora of goods: everything that needs electricity such as computers, televisions, remote controls, other “trinket” things such as baseball cards, music stored on digital devices, and on and on and on.

ktibuk: “No. Not everything is valued for its exchange ability. When you buy a hamburger you value it, not because you think you can exchange it for another good. If you did then that hamburger would be considered as money. But you value it for its ability to satisfy your hunger.”

The person who makes the hamburger values it for its exchange ability. Every specialized division of labor surplus production values that surplus production good for its exchange ability. In all exchange, multiple persons value the same good, and multiple persons value the same good differently. There would be no trade if that wasn’t the case.

The sentence, “But you value it for its ability to satisfy your hunger”, is pure Marxist use-value theory. Lots of things satisfy hunger. Snickers. Hot dogs. Yet there is no equation of subjective value between different products that “satisfy hunger”. Beluga caviar “satisfies hunger”, but is wholly and completely immaterial to the subjective value particular persons assign to marginal quantities of it.

ktibuk: “The shop accepting your money for the hamburger, on the other hand, values your money not because it will directly satisfy his need but for its exchange value.”

Whatever the reason, the shop values the money *more* than the hamburger by definition of trade. The shop could have chosen to just eat it himself, or not produce it in the first place, or have traded it for something other than money. All surplus production of all goods to be traded is valued for its “exchange value”; hence, “exchange value” is not uniquely applicable to “money”, but applicable to all goods and services by definition of them being goods and services. Therefore, it does *not* follow: “So you see there are two types of things in this word rtr. There is money and there are goods.”

Money has not and cannot be categorically differentially classified as a non good.

ktibuk: “Money is not a good. It has to evolve from a good but when it becomes money at that moment when it is valued not for its own sake but its exchange ability, then it ceases to be a good.”

The reasons why it’s valued are immaterial. Even in a gold standard money system, gold would still be used for fashion and industrial subjectively valued purposes. It would and could never cease to be a good except only when it is subjectively valued by one or none persons. If it is subjectively valued by two or more persons, it is by definition a good. (^_^, new epistemologically precise definition of “good”).

Just because the owner of a shoe factory doesn’t value 10,000 pairs of shoes for “its own sake but its exchange ability” does not mean shoes cease to be goods.

ktibuk: “If you define a good as anything that satisfies human needs directly.if consumed. You can’t consume money. That is why money is not wealth.”

You are abusing the word “consume”. You can’t “consume” a house either by eating it. You can burn “consume” paper fiat currency money by burning it to light your Cuban cigars with flair.

Wealth is anything that has subjective valuation. Money has subjective valuation. Money is therefore wealth.

ktibuk: “The result of digging for gold is also redistribution of wealth, if gold is money.”

And this is why Austrian Monetary Theory is more epistemologically accurately named Marxist-Austrian Monetary Theory (MAMT).

ktibuk: “Wealth is total goods and services that are produced and owned in a society.”

We agree 100% here. So it looks like the source of the MAMT error was a mistaken definition of money as a non good. This is why I correctly define money as “the most commonly exchanged *good* in trade”.

ktibuk: “I am talking about the total amount of money not one individuals. Of course if one individuals destroys its money he loses and every other money holder gains. But if you destroy half of all the money, like taking half of everyones money and burn it, amount of wealth wouldnt change a bit.”

That’s a blatant contradiction absurdity. If one individual destroys his money he loses and everyone else gains, but if you “evenly proportionally” destroy half the money no change whatsoever occurs in wealth (as if changing numbers on pieces of paper magically changes the subjective value of those pieces of paper). In the former net subjective value of money allegedly increases, in the latter net subjective value of money allegedly remains unchanged, even though supply has decreased in both instances.

Although, since Marxist-Austrians allege money is not a “good”, using the term “supply” is another epistemological error which they commit. To be less epistemologically in errors with their MAMT perhaps they should replace the term “supply” with a new term such as “blob”, non good non supply. How you can inflate or deflate an amorphous “blob” is a mystery; perhaps they employ some kind of “zombie” detection methodology.

This is the zero sum “claim slip” conception of money where somebody wins a coat or a car, if the customer loses their coat check ticket or valet ticket stub.

It seems another of the fatal fundamentally flawed monetary theory assumptions is that all the money “clears”, trades for, all the goods. To even be theoretically workable, all the money must “match” all the subjective value of all non money goods and services as “claim slips”, which is a practical impossibility given ever changing subjective valuations of those goods and services. But it’s nevertheless assumed that it just “magically” does this.

This also doesn’t take into account contractual debt, where the debt is repayable in a specifically enumerated “legal tender” good form.

This is also the difference between a fiat paper money supply and free market determined commodity money supply.

Reasons are not immaterial when it comes to analyzing money. And yes you are wealthy owning a cow, which is a good, but you are not wealthy owning anything that is considered money, be it gold or fiat paper. Take a billion dollars to deserted island with you and you will see it is not wealth when you starve.

rtr, “Everything is valued for its exchange ability, nothing is not, by definition of anything that is traded. That which is received is valued more than that which is given away in exchange. You have observed trades of goods for money have you not? Or do you just refer to those actions as one-sided “buys” or one-sided “sells”?”

No. Not everything is valued for its exchange ability. When you buy a hamburger you value it, not because you think you can exchange it for another good. If you did then that hamburger would be considered as money. But you value it for its ability to satisfy your hunger. The shop accepting your money for the hamburger, on the other hand, values your money not because it will directly satisfy his need but for its exchange value.

So you see there are two types of things in this word rtr. There is money and there are goods.

rtr, “Money is a good. It is subjectively independently valued. See fiat currency having subjective value. See collapsed fiat currency losing subjective value.”

Money is not a good. It has to evolve from a good but when it becomes money at that moment when it is valued not for its own sake but its exchange ability, then it ceases to be a good. If you define a good as anything that satisfies human needs directly.if consumed. You can’t consume money. That is why money is not wealth.

rtr, “Then why would people dig for gold, even in gold standard monetary systems? Why wouldn’t that be considered “counterfeiting”? Why wouldn’t all duplicating competitive production of all things be considered copying “counterfeiting”?”

The result of digging for gold is also redistribution of wealth, if gold is money. And it is almost the same as counterfeiting in paper money. The only difference is counterfeiters costs are low in the case of paper money. Thus paper money systems prone to create more counterfeiters.

rtr, “Which of course is false, by observing trade exchange of more money trading for more goods. The converse would be “in no case of monetary contraction total wealth is decreased. Never, ever.” So drop all your money then if you believe it will have no effect upon your wealth.”

Wealth is total goods and services that are produced and owned in a society. Money may affect the production of wealth because money prices are also signals. But by itself the amount of money is not related to wealth. Amount of money is irrelevant.

You can have 1.000.000 dollars of total money or you can have 1.000.000.000.000 dollars of money. If you produce the same amount of goods and services you are equally wealthy.

That was the case in Turkey 4 years ago. One night there was 1.000.000.000.000 liras, and the next day there was 1.000.000 liras of money in the country. People didn’t become poor over one night. Just all of the nominal money prices had to adjust in the economy.

rtr, “Which of course is false, by observing trade exchange of more money trading for more goods. The converse would be “in no case of monetary contraction total wealth is decreased. Never, ever.” So drop all your money then if you believe it will have no effect upon your wealth.”

I am talking about the total amount of money not one individuals. Of course if one individuals destroys its money he loses and every other money holder gains. But if you destroy half of all the money, like taking half of everyones money and burn it, amount of wealth wouldnt change a bit.

If you have a cow you can be considered wealthy on a deserted island. If you have a diamond coated saw blade you can be considered wealthy on a deserted island. Yeah, “every thing is valued by the individual subjectively, but the reasons are different” AND immaterial. Autographed baseball cards trade for autographed pieces of fiat paper currency. So what?

ktibuk: “Money is valued for its exchange ability, by definition. Money is something that is valued for its exchange value. It can be gold, paper or cigarettes.”

Everything is valued for its exchange ability, nothing is not, by definition of anything that is traded. That which is received is valued more than that which is given away in exchange. You have observed trades of goods for money have you not? Or do you just refer to those actions as one-sided “buys” or one-sided “sells”?

ktibuk: “Increase in the amount of goods increases wealth.
Increase in the amount of money doesn’t change the total amount of wealth. Not one bit.”

Money is a good. It is subjectively independently valued. See fiat currency having subjective value. See collapsed fiat currency losing subjective value.

ktibuk: “Whether gold or fiat paper, increase in the amount of money is neutral in the best case”

Then why would people dig for gold, even in gold standard monetary systems? Why wouldn’t that be considered “counterfeiting”? Why wouldn’t all duplicating competitive production of all things be considered copying “counterfeiting”?

ktibuk: “The best case every money holder increases its money by the same percentage at the same time. Like adding a zero to the bills.”

That’s as silly as saying in the best case every farmer increases his grain production by the same percentage at the same time, like adding a zero to the pound weight. If all farmers except one maintain the same happy Marxist equal production output per year but one farmer plants and harvests early and doubles his production output, that won’t effect the other farmers, that won’t have any positive effect for the net wealth of society?

The ktibuk-Marxist-Austrian economic analysis method says, “That means taking wealth from the current farming producers, and giving it to the new farming producers. That is wealth redistribution.” We suppose ktibuk would also advocate government redistribution programs to correct this “injustice imbalance”, along with perhaps government licensing requirements to prohibit uncontrolled non centrally planned farming supply that is causing “distortions”.

ktibuk: “In no case of monetary expansion total wealth is increased. Never, ever.”

Which of course is false, by observing trade exchange of more money trading for more goods. The converse would be “in no case of monetary contraction total wealth is decreased. Never, ever.” So drop all your money then if you believe it will have no effect upon your wealth.

ktibuk: “A good is valued for its ability to satisfy needs.”

So “money” must therefore be a superfluous unnecessary wasteful non needed product?

Well I think it will clearly stick this time around generally that Marxist-Austrian Monetary Theory is demonstrated. Perhaps there will be cringing groans circulating for the Austrian defense put forth, but don’t forget to enjoy the poetic tasty blood circus irony of me labeling Mises’ monetary theory Marxist. I guess I’ll have to say it for Mises, “You’re all a bunch of ****** socialists!”

R.I.P. Marxist-Austrian Monetary Theory (M.A.M.T.)

PR: “Means and ends – Action is only performed because people subjectively value the action itself. Outcomes, expected or actual, are irrelevent. Be sure to use the word “epistemological” somewhere if you need this to sound more convincing.”

I would indeed recommend you go back through all your old books, cross out wherever you find the word “means” and replace it with the word “step”.

The whole ends/means dichotomy classification nonsense derives from the parochial classification between work and leisure.

PR: “Time preference – People never choose between present consumption and future consumption.”

In PR Fantasyland, freezers never fail and milk never spoils, let alone spills.

No it is not saying like that at all. Money is not wealth. If you have grain you can be considered wealthy in a deserted island, but with money you can not. Money is valuable when there are other goods that exchange for it.

Every thing is valued by the individual subjectively, but the reasons are different.

A good is valued for its ability to satisfy needs.

Money is valued for its exchange ability, by definition. Money is something that is valued for its exchange value. It can be gold, paper or cigarettes.

Increase in the amount of goods increases wealth.

Increase in the amount of money doesn’t change the total amount of wealth. Not one bit.

Whether gold or fiat paper, increase in the amount of money is neutral in the best case and causes wealth redistribution in the worst. Ethically that is.

The best case every money holder increases its money by the same percentage at the same time. Like adding a zero to the bills. That may change nominal representation of values, everthing would be priced as 10 time more. But the total wealth would be the same. Because the amount of goods havent changed.

Worst case new created money is given to certain people. That means taking wealth from the current money holders, and giving it to the new money recieivers. That is welath redistribution.

In no case of monetary expansion total wealth is increased. Never, ever.

PR, what exactly do you mean by “ex post subjective valuations”? Action only occurs in the present tense. There’s no magical time traveling RE-valuations of subjective value.

Right, this is pretty much the response I have come to expect from you. Any concept that doesn’t fit your narrow collection of empty tautologies is defined out of existence.

As a how-to guide for sounding like rtr, I will show how we can do away with:

Means and ends – Action is only performed because people subjectively value the action itself. Outcomes, expected or actual, are irrelevent. Be sure to use the word “epistemological” somewhere if you need this to sound more convincing.

Interpersonal exchange – Pure fiction. My giving the cashier money and his giving me a bag of goods with a receipt are two totally unconnected actions. No, really.

Fraud – Obviously if there is no such thing as interpersonal exchange, there can’t be any fraudulent ones. This is an ideal place to use an epithet like Marxist or noob.

Time preference – People never choose between present consumption and future consumption. Instead they subjectively value non-consumption one day and then later, in a completely unrelated set of circumstances, they choose the opposite. Or if you prefer, just assert forcefully that there is no such thing as “time.” The quotation marks are vital.

More suggestions are welcome. With this method, I am confident that all of economics can be reduced to a short paragraph or two. Use the remaining space to write your Nobel acceptance speech.

Are you a fashion designer criticizing the clothing style choices of people walking down the street as “errors”. Sounds epistemologically accurate. /sarcasm

Michael A. Clem: “For example, we know that people subjectively value toasters, because they buy lots of them. Why do they value toasters? What do they do with them?”

Look at the Austrians running for the Marxist “use-value” hills! It’s so retro “cute”.

Michael A. Clem: “Likewise with money–people value it, but why and what they do with money is supposedly not an economic question.”

Why would there be any “money” in a Marxist socialist production economic system? Wouldn’t producing money just be a waste of your Chairman’s resources? What does your Mao define as the *purpose* of “money”?

ktibuk: “FED increasing money supply is the same thing. It gives people an illusion of wealth increse when infact nothing of that sort is actually happening. Deflation phase the is the readjustment of the books to the reality and it hurts.”

Completely absurd. That’s like saying a farmer increasing the production grain output of his farm is merely giving an “illusion of wealth increase”.

Your false Marxist-Austrian Monetary Theory is causing you to incorrectly analyze economic phenomena. Do you seriously pretend “money supply” is a non subjectively valued thing?

“How” doesn’t matter for the analysis purposes of subjective valued supply. It’s irrefutable that a society with 10X gold is net subjectively wealthier than a society with 3X gold. The greater the supply, the lower the scarcity, the lower the price, the more wealth exists.

Ireland: “Why exactly would anyone insist on calling this an “increase” in anything (including net subjective wealth), is unclear.”

Because there is *more* of something which is subjectively valued.

Ireland: “Remember the cube selling example? Tell us in detail about the net subjective wealth increase for the existing owners of gold in situation where someone else brings more new gold into the system.”

They live in a society with more net subjective wealth. The End.

Others producing either the same stuff, or other different stuff doesn’t cause anyone to sink into poverty. They have to spend less time producing that same thing themselves to ensure it exists, and are thus afforded the luxury of either having to spend less time and effort producing that same thing themselves, or they are afforded the luxury of being able to produce other different things that they previously didn’t have the time or trade support means to undertake. This is how the division of labor operates.