: I would question wether you even need to know that. In order to get the paper you would only ned to know hat handing over that shiny coin results in you getting the paper - you need know nothing more than that strictly speaking. Thats the transaction.
I wouldn't ened to know that, as a consumer, or producer, but as an economist, I would neeed to know that what I was talking about was meaningful. I use many words a day, I struggle when asked to define them, its not a thing we consciously know, but we know how to use them - £1 is a word. What does it mean? I don't believe that we have useless, meanuingless language. you're ducking the question, btw, and its quite a vital one.
: Without anyone else in the transaction it would indicate that which you would willingly exchnge for the item.
How do I express that? What does the fact that I will pay £1 mean? You're resorting to a circular argument if you say it just represents teh otehr things I could buy for £1. What is the Metric?
:When millions of people are doing those exchanges its impossible to manage each one individually (imagine mind reading checkout staff!) so the price ends up as an amount which will attract the number of buyers roughly equal to the supply - which is blinkin' difficult to calculate - so as to generate the most revenue / profit.
The amount of what? How calculated? How expressed? What does £1 mean?
: Because so many other fellows want the paper, because of the relative supply of the two, because of the access to market of that supply, because of the amount to exchange y'all had - I think you get the picture. the factors involved are legion. This was the very reasonable criticism made of command economies by Von Mises - that you'd never calculate that lot from the department of commerce.
No, his argument was teh monetary calcuation argument, as I have described to you, but you can't account for it all by supply and demand: what is teh basis on which supply and demand fluctuates the rpice? Where does it start? If 500 people wanted a car, say, and 500 wanted a bog roll, and supply and demand are exactly the ratio same in both cases, then shouldn't the price of a car and of bog-roll be teh same?
: You just cant mate, sorry. Best you can do is relate you 'desire' to the desire you have for alternatives and go from there.
But that's circular, and thus £1 means nothing. On I must have a common basis between those goods in order to be able to compare them with £1.
: If money was based upon potatoes then the desire for potatoes would be the regulator - the note would be a promise to pay potatoes.
But how would otehr goods be compared with potatoes? on what basis could a meaningful, comprehendable comparison be made?
:Thats simplisitc - now take money as representing all products - promises to pay all products and hey presto you have a stable currency made up by millions of wildly swinging desires/abilities to exchange and all those factors above - all fluctuating itself to a relative stable standstill.
But what does that money express, what is the factor that it compares between commodities? Isn't money a commodity itself?
: Indeed, and the modification of supply/demand and all those factors is what i think makes using labor time as the basis theoretically interesting and practically / mathematically too simplistic and too uninforming to describe actual exchanges..
No, because labour time describes the *logic* of the system, its what makes supplya nd demand make sense.
: But then how long would it take you to build a satellite and TV all by yourself?
I described an early society, before division of labour really set in, as the basis of this thinking, we have developed since then, to where it is not a feasible thought, too much machinery involed, etc. But the basics, that my social effort, in terms of the labour I contribute, should be returned to me.
: We are left with less than useful statements - as I descibed above with all those factors, only focussing on labor is also not useful.
I don't say we only focus on Labour, merely that that is how the system works.
: As SDF pointed out elsewhere (sorry, dont know which point) Gold is subjected to the same relative desire conundrum as all things. Its useful, it may be steadier than many things but its still subject to the vagaries of demand/supply - as are currencies themselves.
Indeed, hence the Bank of England would have to alter interest rates as Gold entered and left the cuntry.
Keep it simple;
What does £1 mean?