80% of US debt purchased by the Fed in 2009?!

[scriabinop23]

Quote from jficquette:

The only system we have is money creation. All activity is derived from it.

Feel free to try again.

Let's say I create intellectual property and make a scientific discovery that is worth something. I've created an asset without accompanying debt.

You are talking about the zero sum nature of money exchange. But the "system" I was referring to was the balance sheet of an *individual* entity. You didn't explicitly specify aggregate versus individual here, before.

 

[jficquette]

Quote from scriabinop23:

Let's say I create intellectual property and make a scientific discovery that is worth something. I've created an asset without accompanying debt.

You are talking about the zero sum nature of money exchange. But the "system" I was referring to was the balance sheet of an *individual* entity. You didn't explicitly specify aggregate versus individual here, before.

It isn't worth anything until you sell it. Until you exchange it for an asset it does not affect the real world.

 

[scriabinop23]

Quote from scriabinop23:

Let's say I create intellectual property and make a scientific discovery that is worth something. I've created an asset without accompanying debt.

You are talking about the zero sum nature of money exchange. But the "system" I was referring to was the balance sheet of an *individual* entity. You didn't explicitly specify aggregate versus individual here, before.

Actually with a little more thought, lets say I am an artist and make a painting but don't sell it. Lets say it has a market value (based off of my other work). I have not increased my debt to create this. Collectively, I have created assets from thin air without creating a liability. Since no one needed to create more money to buy it from me, my balance sheet is greater on the asset side, as well as everyone else's balance sheet remains constant.

 

[scriabinop23]

Quote from jficquette:

It isn't worth anything until you sell it. Until you exchange it for an asset it does not affect the real world.

But you are ignoring the point --- it is worth something to humanity, just as the piece of art I produced. Lets say I retain it on my balance sheet and let museums keep it and show it. People benefit --- (or the same from my scientific discovery) --- We have a net gain to society without adding debt.

A trade isn't necessary for value to be added.

 

[jficquette]

Quote from Random.Capital:

And if the loan isn't made (ie, money isn't created), nobody has anything.

I think we're saying the same thing, in roundabout ways.

I agree.

 

[Random.Capital]

Quote from scriabinop23:

Let's say I create intellectual property and make a scientific discovery that is worth something. I've created an asset without accompanying debt.

How have you done it without creating debt? You're living in a country where the infrastructure you need to develop your IP is funded by debt. That you, personally, didn't take out a loan is irrelevant - your entire support structure, without which you would not be able to do what you are doing (including using the internet to post on ET), is created through debt.

This is like arguing that living in mom's basement subsisting on homegrown rice is living debt-free - meanwhile mom is making monthly payments on a mortgage.

 

[Dacamic]

Quote from scriabinop23:

But you are ignoring the point --- it is worth something to humanity, just as the piece of art I produced. Lets say I retain it on my balance sheet and let museums keep it and show it. People benefit --- (or the same from my scientific discovery) --- We have a net gain to society without adding debt.

A trade isn't necessary for value to be added.

Correct.

Furthermore, bartering allows exchanges of assets without need for money.

 

[jficquette]

Quote from scriabinop23:

But you are ignoring the point --- it is worth something to humanity, just as the piece of art I produced. Lets say I retain it on my balance sheet and let museums keep it and show it. People benefit --- (or the same from my scientific discovery) --- We have a net gain to society without adding debt.

A trade isn't necessary for value to be added.

What one thinks something is worth is not real world. Until its sold it isn't worth anything.

 

[jficquette]

Quote from Dacamic:

Correct.

Furthermore, bartering allows exchanges of assets without need for money.

Exchange of assets is the same as exchanges of money. Money is what assets are valued in.

 

[scriabinop23]

Quote from Random.Capital:

How have you done it without creating debt? You're living in a country where the infrastructure you need to develop your IP is funded by debt. That you, personally, didn't take out a loan is irrelevant - your entire support structure, without which you would not be able to do what you are doing (including using the internet to post on ET), is created through debt.

This is like arguing that living in mom's basement subsisting on homegrown rice is living debt-free - meanwhile mom is making monthly payments on a mortgage.

Lets say rent for mom's basement was $1000. I paid that out of savings. My discovery is worth $30000. I created an asset without increasing debt to correspond.