On the Szabonian Deconstruction of Money and Gresham's Law

On the Re-Solution of a Zeno Paradox of Money

The possibility that money arose from something intra-kin still needs further deconstruction of our understanding of the word money in the context we might mean to use it. It’s quite obvious there is complexity distance between the concept of money today and of any time when money could have somehow have said to have originated.

There is money now however, this is unarguable, and there must have been a time we feel in which there was no money. Recurse these down, and therefore there must have been a time in history when money originated.

But to the civilized human today that explanation breeds calculus considerations that we attribute Newton to memeing into our common frameworks. It begs the question of how money originated in the time that it did and in the way that it did.

Rather than, to give an extreme counter example, asking what market, in what city, and what civilization, and what day was money created, as this would be to obviously frame money as something it is not (and then look for an origin for it that couldn’t possibly be found.).

Games as Pre-Market Money Valuators

We have some ideas about games and their evolution as proto-markets.

On The Wrapping and Deconstruction of Money

Over the history philosophers on the concept of money have wrapped it with their understanding of it:

historyOfPhilosopher{money}

We want to explore the concept of what money is by considering what it wraps:

money{?}

The above represents the origins of money but with more careful consideration than looking for empirical based confirmations of a predefined framework for it.

Here we can see that different philosophers may have used the term money to wrap different concepts. It is the ‘Szabonian’ part of our deconstruction that points to the ‘useful’ framework for it. We aren’t at this time showing how we decided the useful framework. As a computational shortcut we simply present it.

On Culturally Significant But Otherwise Seemingly Valueless Objects

Anthropologist Jo Walton’s advises on the problematic habit of analogizing historical anthropological NARRATIVES with guesses on the origin of money (ie by Saifedean Ammous):

Although the analogy is intriguing, it nonetheless depends on opportunistic misrepresentations of Yapese economic cultures. None of the analogy’s major specific points holds up to scrutiny. Each is either ill-defined, unconvincing, and/or trivial. This leads me to urge greater caution in the study and pedagogic use of Yapese economic cultures. Until the pattern of opportunistic conjecture about stone money is much more widely recognized and redressed, I suggest, efforts at linking blockchain and stone money are likely to merely perpetuate it. Rather than attempting to rehabilitate such analogies, it would be better for the time being to avoid them altogether.

Here we want to consider the ‘thing that money wraps’ the concept of instiling cultural value into objects-ie cultural wrapping.

We don’t mean to introduce a complex term. This is not meant to be a construction of anthropology, but rather we offer this consideration as a deconstruction of money ie an answer to what money wraps.

That is to say we mean to take Walton’s advice, and not frame our inquiry with the bias of trying to prove a present day analogue of money.

Rather, if we think of a more general concept of how interesting it is that cultures put value into things that sometimes don’t even seem to otherwise have value to humans, but without restricting the inquiry to things we need that prove our monetary theorems, the suggestion here is that we look with a framework concordant to Walton’s field.

This reduces the complexity distance, near to zero, a Szabonian quality of the framing.

On Culturally Significant Otherwise Seemingly Valueles Objects As Capacitors

To reduce the complexity distance with other fields such as our representation of electricity we find it probably useful to consider objects that gain the strange endowment of cultural based value-as capacitors:

capacitors{storesOfValue}

Then it's suggested that our inability to inquire into the history of money, as a wrapped capacitor, would preclude us from understanding the nature of it and the origins of it (for a better understanding of this we suggest a thorough read of Nick Szabo’s entire works and especially Shelling Out: The Origins of Money, probably take some time to philosophize about the related subjects, and then go back to Shelling Out etc.

On Institutions as the Evolutionary Result of the Customs of Created From the Evolution of Games

Our framework considers institutions as wrappers of markets which are wrappers of games:

institutions{markets{proto-markets{games}}}

This is not an anthropological claim but a suggestion of how these things might be best represented as we explore their nature and origins.

To the contrary of making an anthropological based claim that might be exhaustively invalid to the anthropologist we feel our view will be welcomed and received as refreshing (SZABONIAN deconstruction ie because its useful).

On Wrapping Capacitors As a Form of Early Money

If it can somehow be agreed from an anthropological stance that it does make sense that we wrap objects with cultural significance and that gives them value in an economically meaningful sense (economically meaningful sense hardly needs to be defined here) we can consider if money might have arisen by wrapping capacitors of this type of value.

From a metaphorical standpoint, to explain what ‘wrapping’ means in this context, we can think of storage silos full of rice, in a society with no money, and no markets.

With money and markets existing, the problems of economics are already well fleshed out. That humans create stockpiles of whatever they used to survive on a cooperative level is fully founded. The issue is why and how money arose, and also when and how markets arose, and what relationship each of the two have in their respective inquiries.

Metaphorically at least, to birth money by wrapping a silo of grain, is to create a credit system using numbers based on the rice stored.

With our wrapping framework, the arguments and complaints of the anthropologist aren’t that this is an incorrect wrapping, but rather about the complexity distance (when and how it happened etc.).

“Sure your order is correct but you have compressed the truth down in a way that renders the complexity distance immeasurable”. They would complain if they used our framework and lexicon.

Transformers as Wrappers of Themselves

In electrical theory there are transformers that used to step up and step down voltage. Transformers are often themselves made up of multiples of transformers:

transformer{transfomer}

We consider that one of the concepts humans have been reaching to explain is the concept of wrapping money in order to evolve it to serve a new order or new evolution of civilization as money:

money{money}

Then in our syntax we show a special property of the useful concept of money.

On the Regression of the Theorem of Money as a Wrapper of Money

However, if we were to inquire into the history of money by ‘unwrapping’ the following:

money{money}

We might be fooled into instantly thinking it infinitely regresses but of course through our understanding of the Szabonian construction of 'wrapping money to evolve money' we are simply stating that there is a complete loss of continuity of information in this regard.

Once money evolves to wrap itself, you can’t necessarily deconstruct the (capacitant) origin of it.

In this sense the value in the money is inducted.

On Inductance or Capacitance as Culturally Instilled Value of Otherwise Un-Valued Objects

This gives us a better framework for both anthropological inquiries and economic understanding of our past and present time. That one culture could wrap a culturally significant object or object of another's culture is something we feel an anthropologist would be able to naturally enter into.

We can call this phenomenon capacitance to make it more conducive to electrical theory.

And this concept can be extended to money as well. That one culture’s money could extend or wrap another's capacitor or their money. Or perhaps find capacitance by wrapping other culture’s money etc.

Here the anthropologist's complaint would no doubt be the truth is more complex, we simply mean to offer this framework and lexicon as having low distance complexity with economics and other fields.

On the Wrapping of Gresham’s Law and the Szabonian Deconstruction of It

Consider Gresham’s Law as a wrapper of the narrative of a situation between Gresham and the Queen he served:

In economics, Gresham's law is a monetary principle stating that "bad money drives out good". For example, if there are two forms of commodity money in circulation, which are accepted by law as having similar face value, the more valuable commodity will gradually disappear from circulation.[1][2]

The law was named in 1857 by economist Henry Dunning Macleod after Sir Thomas Gresham (1519–1579), an English financier during the Tudor dynasty.[3] Gresham had urged Queen Elizabeth to restore confidence in then-debased English currency. The concept was thoroughly defined in Renaissance Europe by Nicolaus Copernicus and known centuries earlier in classical Antiquity, the Middle East and China.

From the same wiki page George Selgin says of Gresham’s Law:

As for Gresham himself, he observed "that good and bad coin cannot circulate together" in a letter written to Queen Elizabeth on the occasion of her accession in 1558. The statement was part of Gresham's explanation for the "unexampled state of badness" that England's coinage had been left in following the "Great Debasements" of Henry VIII and Edward VI, which reduced the metallic value of English silver coins to a small fraction of what it had been at the time of Henry VII. Owing to these debasements, Gresham observed to the Queen, that "all your fine gold was convayed out of this your realm".[21] But these are wrappers because they are not the letter from Gresham.

On Gresham’s Law and Wrapping Money as Capacitance

We can imagine a state (that wraps a population of citizenry) that needs to release some of its capacitance in order to stave off economic hardship. In that case that "the ‘fine gold’ left the realm" would simply be an observation of this technology working in great order.

Then to call one money bad and the other money good would be to wrap them in a construction.

To extend this construction as natural law would probably be to extend Szabonian valueless arguments.

But, how does the construction meme if its not valuable?

Because its useful, for example, for the libertarian that needs devalued money to be bad because the libertarian thinks from the individual framework, and the cooperative devaluation is a Hobbiesian deference in times of strife in which a society admits to Smith’s synopsis of Hobbes (TOMS):

…that a state of nature is a state of war; and that antecedent to the institution of civil government there could be no safe or peaceable society among men. To preserve society, therefore, according to him, was to support civil government…

And in this instance it is man at war with all aspects of nature, not just himself. But even with himself the libertarian view can’t ever be popular when one’s city is under besiegement. The libertarian or ‘anti-keynesian’ and other comparable complexity distance shallow frameworks need error handling for the reality of war-since their arguments don't let even moral conquerees to economically defend versus a conqueror with devaluation of their capacitance.

From experience we know that ‘war wouldn’t happen if money was good’ is certainly part of the axioms and tenants of such systems but it doesn’t salvage the inconsistency if we still need to ask how to defend ourselves if not collectively with our savings (and what sane individual would argue against such a thing?).

But from these frameworks the wrapping of Gresham’s wrapping of money, that devalued money is intrinsically bad and its counterpart intrinsically good, is a useful (but nefariously misleading and valueless) computational shortcut.

A New Framework For Understanding Bitcoin And its Ability to Port Stability to Other Monies

And now it might be surprising to the reader but by deconstructing Gresham’s law and the understanding the nature of the deconstruction of money (that it wraps itself), we have fleshed out a useful framework to understand how monies of today could wrap Bitcoin and induct the usefulness of its capacitance.

Examples of Historical Wrapping of Money in Order to Induct It’s Capacitance

George Selgin gives us an example of this concept which he refers to as the creating of a ‘synthetic’ commodity money. Synthetic commodity money, in this case, functions like a commodity money from a praxeological view (praxeological, meaning we can make some logical extrapolations and expect them to be useful) and in this instance effectively ports the storage value of the base money it wraps:

While no government has ever deliberately established a synthetic commodity money, and though it is not even clear what steps would be required to officially establish such a money — that is, what steps a government might take in order to truly deprive itself of the means for authorizing new forms of money — synthetic commodity money is not just a hypothetical possibility. One recent, unplanned instance of such money was the so-called Iraqi Swiss dinar.

Prior to the 1990 Gulf War, Iraq’s official currency consisted of paper dinars printed in the U.K using Swiss-engraved plates. During the war, sanctions imposed on Iraq prevented it from importing more of these notes. Hussein’s government in turn chose after the war to decry its former currency, issuing so-called “Saddam” dinars in its place. Saddam dinars were subsequently issued on an enormous scale, both officially and by counterfeiters, for whom the poor-quality notes were an easy target, causing it to depreciate rapidly. But Swiss dinars, as the old notes came to be known, continued to circulate in the northern, Kurdish regions of Iraq; and they, in contrast, held a remarkably stable purchasing power and exchange rate relative to U.S. dollar despite gradually deteriorating from constant use.

By 1998 the Saddam-Swiss dinar exchange rate had risen to 100:1, where it hovered for several years before rising to as much as 300:1 in the course of the 2003 invasion. Eventually the Coalition Provisional Authority, in its effort to stabilize Iraq’s official currency, pegged it to the Swiss dinar at a rate of 150:1, while eventually providing for renewed production of official notes using the original Swiss plates, with their denominations modified to correspond to those of the former Saddam dinars. The new dinars were also distinguished from the old (synthetic commodity) Swiss dinars in being printed in a different color (King 2004, pp. 7ff.).

We feel it's an ideological argument not separate from the actual battlefield combat of the conflict as to whether not the Saddam dinars, being relieved of their role as a stable base currency, is a good or bad thing making it a good or bad money.

Nonetheless its therefore a numismatically supported view that money from one society or economy can serve as a stable currency for another economy. So that the porting economy can use the capacitance of the stable currency for their savings and be free to use the currency they control as they see fit.

On Extending Gresham's Law as an Attempt to Preserve Consistency of an Inconsistent Argument

This is a further deconstruction as to what is good or bad money as well as the origin and nature of it. That we might wrap it differently in response to different economic times would obviously then inspire us from new economic times to look back on it differently (and perhaps negatively on previously useful wrappings etc.). And furthermore in new economic times we would be, in attempts to preserve our own consistency, if not careful, compelled to wrap the good or badness of money in seemingly useful but actually valueless ways.

On Extending Thier's Law As an Attempt to Preserve Consistency of an Inconsistent Argument

As a corollary to Gresham’s law , or rather a construction in order to preserve the consistency of it in the face of naturally observed phenomenon Thier’s law was coined (from the same wiki page):

The experiences of dollarization in countries with weak economies and currencies (such as Israel in the 1980s, Eastern Europe and countries in the period immediately after the collapse of the Soviet bloc, or Ecuador throughout the late 20th and early 21st century) may be seen as Gresham's law operating in its reverse form (Guidotti & Rodriguez, 1992) because in general, the dollar has not been legal tender in such situations, and in some cases, its use has been illegal.[22]

Adam Fergusson and Costantino Bresciani-Turroni (in his book Le vicende del marco tedesco, published in 1931) pointed out that, during the great inflation in the Weimar Republic in 1923,[dubious – discuss] as the official money became so worthless that virtually nobody would take it, people simply stopped accepting the currency in exchange for goods. That was particularly serious because farmers began to hoard food. Accordingly, any currency backed by any sort of value became a circulating medium of exchange.[23] In 2009, hyperinflation in Zimbabwe began to show similar characteristics.

Those examples show that in the absence of effective legal tender laws, Gresham's Law works in reverse.

Mundell is credited with wrapping those two laws with an allegedly disambiguating extension thus attempting to re-solve the two scenarios with a synthetic construction (again same wiki page as Gresham's Law) by adding Gresham's law holds, 'if they exchange for the same price':

Nobel Prize winner Robert Mundell believes that Gresham's Law could be more accurately rendered, taking care of the reverse, if it were expressed as: "Bad money drives out good if they exchange for the same price."[25]

On the Re-Synthetic Deconstruction of Gresham’s Law

From our view it’s not necessary to re-sovle Gresham’s law with Thier’s law because the notion of good or bad money he wrapped the concept of money of his time with was only useful in particular for his letter to the Queen. To Gresham’s framework we declare:

‘We are not the Queen, we are the people; We should see money how we see it fit, not how the Queen sees it fit.’

On the Re-Synthetic Deconstruction of Machiavelli

Machiavellian type thinking is generally refered to as a type of devious or nefarious type thinking. As a computational shortcut we invite the general reader to consider the usefulness of thinking from an opponent's view and on the level one’s opponent is thinking. Machiavelli wrote of a more total strategy set that included a primitive unformalized iterative process of gaming out scenarios. Later John Nash formalized the end result of this type of thinking which we wrap and call the “nash equilibrium’.

Machaivellian thinking thus includes a type of thinking which considers strategy options that the church and leading authority of his time had wrapped as being ‘bad’.

At the same time as deconstructing the wrapper of ‘badness’ in which such authority has historically beset on machiavellian type thinking and discourse we want to alleviate taboos and basterdization of discourse on the nature and future Bitcoin in relation to the existing global economy from the same type of stigmatization. Specifically, we want to inquire into the idea of using Bitcoin as a global capacitor while existing major legacy currencies are then and thus free to float against it in moral harmony.

This is, for example, religious taboo to the Saifdeanian system, the Bitcoin Maximalist, the Austrian School in general, etc.