Nishibe The Enigma of Money

Gold, Central Banknotes, and Bitcoin
1. Auflage 2016
ISBN: 978-981-10-1819-0
Verlag: Springer Singapore
Format: PDF
Kopierschutz: 1 - PDF Watermark

E-Book, Englisch, 103 Seiten, eBook

This book provides a new way of understanding modern money and markets by stressing their self-fulfilling/self-destructive properties as institutions from evolutionary perspectives. In contrast to an unrealistic view of the neoclassical general equilibrium theory that models the price mechanism of a 'concentrated market' without using money, presented here is an alternative theory of markets on how a realistic 'dispersive market' using a stock of money and inventory as buffers can work as a multilayered price-quantitative adjustment system. The central features of modern sovereign moneys seen in inconvertible IOUs of central banknotes can be depicted as 'The Emperor's New Clothes' that correspond to the U.S. dollar and the Euro void of their own value. The image captures such characteristics of national currencies as 'self-fulfilling ideas' by the inertia of conventions in the past and expectations of an uncertain future. Both ideas normally make money more acceptable and circulative so that its value can become more stable unless expectations for the future turn very pessimistic. The same logic also applies to such other currencies as Bitcoin and community currencies. Their recent diffusion has shown that Hayek's idea of denationalization of money and competition between multiple currencies in terms of its qualities, not its quantities sought as in ongoing quantitative easing, become more relevant under current situations. The qualities of money refer not only to stable monetary values and low transaction costs, but also to high ability in creating, sharing, and communicating social and cultural value. The potential of the logic of self-fulfillment of ideas can thus open up a new economic society when we realize that such various non-national currencies all depend on the same logic of money.

Makoto Nishibe, Graduate School of Economics and Business Administration, Hokkaido University

Zielgruppe

Research

Autoren/Hrsg.

Nishibe, Makoto

Inhaltsverzeichnis

1;Preface;5
2;Acknowledgments;8
3;Contents;9
4;Chapter 1: The Enigma of Money: If We Understand Money, We Will Understand Economy;13
4.1;1.1 What Is the “Economy”?;13
4.2;1.2 Plural Visions of “Market”: Market as Metaphor;14
4.3;1.3 “Economy” Is a Living Thing;14
4.4;1.4 If We Understand Money, We Will Understand Economy;15
4.5;1.5 The Enigma of Money: A “Thing” or an “Event”?;16
5;Chapter 2: Is Money a “Thing” or an “Event”? Reconsidering Money and Market;18
5.1;2.1 Money and Okane;18
5.1.1; The Okane Story;18
5.1.2; Anything Can Be the Material of Money;19
5.1.3; Religious and Psychological Functions of Money;20
5.2;2.2 What Is “Market”?: Modern Economics Neglects Money;21
5.2.1; No Money, No Market/Commodity;21
5.2.2; Fictitious Markets in Modern Economics: What Is a “Concentrated” Market?;22
5.2.3; A Real Market: What Is a “Distributed” Market?;24
5.2.4; Bilateral Transactions Are Basic in a Real “Distributed” Market;24
5.2.5; Hicks’ Classification of Markets: Flexprice and Fixprice Markets;26
5.3;2.3 How Distributed Markets Work: Stock Markets and the Electronic Bazaar in the Real State of Affairs;27
5.3.1; How “Price” Is Determined;27
5.3.2; Market Price Fixing in Stock Markets: Itayose and Zaraba;28
5.3.3; The Stock Market as a Model of General Equilibrium Theory;30
5.3.4; Electronic Markets Two Decades Ago;31
5.3.5; Face-to-Face Trades and the Market for Lemons;33
5.3.6; Money Turns a Thing into a “Commodity” and a Place for Trading “Commodities” into a “Market”;35
5.4;2.4 The Principles of Generating Money;35
5.4.1; Is Money the Same as Language?;35
5.4.2; Love and Barter Have Something in Common;36
5.4.3; When Money Comes into Existence;37
5.4.4; A Generative Model of Money;37
5.4.5; Imitation of Others’ Wants Brings Money into Being;39
5.4.6; Diversity in Money;41
5.4.7; Negative Possibilities with Money;41
5.5;2.5 Robinson Crusoe and Stone Money on Yap Island;42
5.5.1; The Story of Robinson Crusoe Tells How Hard It Is to Escape from Money;42
5.5.2; “Economy” Without a “Society”;44
5.5.3; Stone Money on Yap Island;45
5.5.4; Anything Can Be Money;45
6;Chapter 3: Money as “The Self-Fulfillment of an Idea”: The Difference Between a Bank of Japan Note and Bitcoin;47
6.1;3.1 Why Talk About Money Leads Us into a Circular Logic;47
6.1.1; Four Functions of Money;47
6.1.2; The Differences Between Money and Commodities;48
6.1.3; Money as the Emperor;49
6.1.4; Talk About Money Quickly Ends Up in a Circular Logic;49
6.2;3.2 Thinking About Money Through “The Emperor’s New Clothes”;49
6.2.1; A Ten Thousand Yen Bill as a Self-Fulfilling Idea;49
6.2.2; Money and the Story of “Emperor’s New Clothes”;50
6.2.3; The Emperor Is Great, Even If He Is Wearing Nothing;51
6.2.4; Access Gift and a Ten Thousand Yen Bill;51
6.2.5; The Self-Fulfillment of Custom;53
6.2.6; The Self-Fulfillment of Expectations;54
6.2.7; Reality Is Strong When Built by Custom and Expectations;55
6.3;3.3 Yenten as Pseudo-money;56
6.3.1; The Yenten Incident;56
6.3.2; Yenten as a Ponzi Scheme;57
6.3.3; Pseudo-Money by Means of a “Prepaid Payment Instrument”;58
6.3.4; Penny Auction;59
6.4;3.4 What Does Bitcoin Tell Us?;60
6.4.1; Bitcoin: A Crypto-currency;60
6.4.2; Problems with Bitcoin;62
6.4.3; Bitcoin Spreads Out;63
6.4.4; Bitcoin and Free Software;64
6.4.5; Bitcoin Points to the Future: Denationalization of Money and Competing Currencies;64
6.5;3.5 What Does the Informatization of Currency Mean?;66
6.5.1; Two Currents of Money: Toward Informatization and Creditization;66
6.5.2; Credit Money and Credit Creation;66
6.5.3; The Essence of Money Is Suggested by These Two Currents;67
6.5.4; When Money Changes, Markets Will Change;68
7;Chapter 4: The Disease Haunting Money: The Relation Between Money and Bubbles;69
7.1;4.1 Humanity’s Desire to Synchronize Creates Bubbles;69
7.1.1; The Word “Bubble”;69
7.1.2; The Heisei Bubble;70
7.1.3; What Is a Bubble?;70
7.1.4; Humanity’s Selfish Desire to Synchronize with Others Creates It;71
7.1.5; Bubbles and the Theory of Evolution;72
7.2;4.2 A History of Bubbles;73
7.2.1; The Tulip Bubble;73
7.2.2; Why Tulips?;74
7.2.3; Tulip Mania Accelerates;74
7.2.4; The Peak of a Feast Is the Beginning of Its End;75
7.2.5; A Man Named John Law;76
7.2.6; Law’s Alchemy;77
7.2.7; Law’s Magical System;77
7.2.8; Stock Mania in “La Compagnie de la Louisiane ou d’Occident”;78
7.2.9; The End of Law’s System;79
7.2.10; The South Sea Bubble Company: Originator of a Bubble;80
7.2.11; A Shady Company = A Bubble Company;81
7.2.12; Geniuses Fooled by Bubbles;82
7.3;4.3 Bubbles as a Self-Fulfilling Idea;83
7.3.1; Money and Bubbles Have Something in Common;83
7.3.2; The Sunspots Theory;83
7.3.3; Illusion and Reality;84
7.4;4.4 Soros’ Bubble Theory;85
7.4.1; Soros’ “Reflexivity”;85
7.4.2; Eight Stages of Bubbles;86
7.4.3; The Contagiousness of Bubbles;87
8;Chapter 5: Why Is Capitalist Economy Unstable? On Hyperinflation and Speculation;89
8.1;5.1 The Disease Haunting Capitalism Is Hyperinflation;89
8.1.1; When Money Breaks Down;89
8.1.2; Even If Money Vanishes, Another Money Will Emerge;89
8.2;5.2 The Difference Between Investment and Speculation;90
8.2.1; Bubbles and Speculation;90
8.2.2; A Beauty Contest;92
8.3;5.3 The Future of Money, the Future of Markets;92
8.3.1; Marx’s and Keynes’ Views on Money;92
8.3.2; Is Money Possible Without Booms or Bubbles?;94
8.3.3; Three Advantages and Three Shortcomings of Market Economy;94
8.3.4; The Focus Is Only on the Market’s Shortcomings;95
8.3.5; Money and “Trust”;96
9;Chapter 6: The Crisis of Capitalism and the “Quality” of Money;97
9.1;6.1 The Meaning of Occupy Wall Street;97
9.2;6.2 Symptoms of the Crisis of Capitalism;98
9.3;6.3 The Crisis in the United States and Japan;99
9.4;6.4 The Quality of Money and Its “Freedom to Evolve”;100
9.5;6.5 What Kind of Money Will Be Chosen and Survive?;102
10;Bibliography;103

Chapter 1: The Enigma of Money: If We Understand Money, We Will Understand Economy.- Chapter 2: Is Money a “Thing” or an “Event”? : Reconsidering Money and Market.- Chap 3: Money as “the Self-fulfillment of Ideas”: the Difference between Bank Notes and Bitcoin.- Chap 4: The Disease Haunting Money: Its Relationship to Bubbles.- Chap 5: Why is Capitalist Economy Unstable? On Hyperinflation and Speculation.- Chapter 6: The Crisis of Capitalism and the “Quality“ of money.

Über Autor(innen)

Makoto Nishibe, Graduate School of Economics and Business Administration, Hokkaido University