goods

3.5 Economics is a Group Activity

Economics is a group activity.  Individuals by themselves can’t create an economic system.  An individual alone can work and labor while creating goods and services for his use and consumption.  An individual alone with no-one else around, would not have a Market in which to exchange goods and services.  No Economic System would exist.  Economic Systems require more than one producing Individual.  The producing individuals interact with each other, in Groups, when exchanging their produced commodities, trades, goods and services on an Open Market.  This interaction of Producers establishes Markets.  Groups of Producers interacting together while exchanging commodities, trades, goods and services establish Marketing Groups.  The function of Marketing is a Group activity.  The Function of Marketing demonstrates that Economics is a Group activity.

Individual Producers also interact with each other, in Groups, during the process of working and laboring while producing commodities, trades, goods and services.  This is another Group activity found in Economics. This also demonstrates that Economics is a Group activity.

Economic Systems are composed of Producer Groups and Market Groups. 

There are producing individuals interacting in Producer Groups while creating money, value, energy, wealth, capital and power.  They are directing and coordinating ideas and purposes while working and laboring together.  While directing and coordinating ideas and purposes they create commodities, trades, goods and services.  They exchange the commodities, trades, goods and services on the Market for money.  

There are Producers interacting together in Marketing Groups during the Marketing of their Commodities, trades, goods and services.

In an Economic System, Money units aren’t absolutely necessary in order to establish an Economic System.  Producers and Markets are absolutely necessary for the establishment of an Economic System.  A bartering system can be used, instead of Money, when exchanging commodities, trades, goods and services on the Market.  However, a bartering system is very inefficient.  It is much easier to transport Money Units on one’s person than to transport commodities, trades, goods and services wherever an individual needs to purchase something. 

Money Units, introduced into an Economic System, lend efficiency to the Economic System.  A money supply held constant standardizes the money unit as a unit of measure. Money is the unit of measure for the value, energy, wealth, capital and power created by the Producers.  A Constant Money Supply standardizes the whole Economic System.  Refer to “The Constant Money Supply” in http://youcreatemoney.com for more information on the Constant Money Supply. 

Here is a side note to demonstrate the tremendous need for maintaining a Constant Money Supply.  In Chemistry the Periodic Chart standardizes the whole field of Chemistry.  Standardized systems of weights and measures have been developed world-wide to prevent people from cheating each other during economic transactions.  Maintaining a Constant Money Supply prevents people from stealing value, energy, wealth, capital and power from other people.  When a Money Supply is expanded value, energy, wealth, capital and power are stolen from the people who currently hold the current money.  It is transferred into the hands of the people who have the new money.

Again, Economics is a Group activity      

Economics is created through Group action.  Functioning economic systems require individuals to work and labor together in groups while creating money, value, energy, wealth, capital and power.  Economics requires individuals working and laboring together in Groups in order to have an economic system.  Today these Groups have grown to include all of mankind on planet earth.  Individuals (Selves) interfacing with other Individuals (Selves) bring about Groups.  All Groups interfacing with each other give us the largest group we call Mankind.

Capital Destroying Socialism 

Socialism (Capital Destroying Socialism) fails because it tends to say or want all people to share the money, value, energy, wealth, capital and power equally.  When all people are required to share equally in the money, value, energy, wealth, capital and power, this sharing results in non-producers and counter-producers being rewarded for non-production and counter-production.  Rewarding non-producers and counter-producers causes an incentive for individuals to not work and labor for money.  Producers are penalized because money they have created is given to those individuals who have not created the money.  The incentive in this form of Socialism is for individuals to not work and labor for the purpose of creating money.  Why should they work and labor if they can receive money without working and laboring?  

This is very destructive to an economic system, an organization, society, nation, mankind and environments.  In this form of Socialism, individuals (Producers) who create all the money, value, energy, wealth, capital and power are penalized.  The money, value, energy, wealth, capital and power, created by the Producers, are shared equally with non-producers and counter-producers.  This is a money, value, energy, wealth, capital and power destroying form of Socialism.  It is referred to as Capital Destroying Socialism.  The Capital Destroying Socialists are counter-producers as well as the Capital Destroying Capitalists.

Capital Destroying Capitalism

Capital Destroying Socialism is not the only form of Socialism.  It is the capital destroying form of Socialism.  Capital Destroying Socialism is the Socialism the Capital Destroying Capitalists like to use as an example of Socialism.  They like to criticize Socialism while using this form as an example of all forms of Socialism.  Capital Destroying Capitalism is also very destructive to all individuals, families, societies, nations, mankind and environments.  Capital Destroying Capitalists have been the primary rulers of Economic systems since the dawn of time.  The Capital Destroying Capitalists attack and criticize anything that appears to threaten their grip on Economic Systems.  The Capital Destroying Capitalists are and have been the principle counter-producers over a long span of time.  Counter-producers also can be found as employees (workers, laborers and managers) in many industries.  They are the secondary counter-producers.  The Capital Destroying Socialists are counter-producers as well.

Capitalism (Capital Destroying Capitalism) fails because it tends to say or want a very few individuals (Selves) to take and have the vast majority of the money, value, energy, wealth, capital and power.  This form of Capitalism attempts to operate at the Self level.  It is impossible to operate exclusively at the Self level since all Producers operate interacting with each other in Groups.  This system of economics rewards non-production and counter-production.  It allows the few rich and powerful individuals to take huge amounts of money, value, energy, wealth, capital and power without exchanging self created production for it on the Open Market. 

The action of concentrating the money, value, energy, wealth, capital and power into the hands of a few rich and powerful individuals is an act of counter-production.  This activity destroys prosperity by bringing about the destruction of money, value, energy, wealth, capital and power.  This destruction is done by redistributing vast amounts of money, value, energy, wealth, capital and power to a very few rich and powerful Selves.  These rich and powerful Selves slow the velocity of money, value, energy, wealth, capital and power.  When money velocity slows, economic systems recede toward depressions.  Everyone in these systems is harmed.  The production Groups and the Marketing Groups are destroyed as a result of concentrating the money, value, energy, wealth, capital and power into the hands of a few individuals.  When Production Groups and Marketing Groups are harmed and destroyed, Economic Systems are harmed and destroyed.  Refer to “Money Velocity and Prosperity” in http://youcreatemoney.com.

Economics is a Group Activity

We must recognize the fact that there is interplay between individual Producers interacting with other individual Producers while creating commodities, trades, goods and services.  This interplay between Producers is a Group activity.  All organizations have individuals interacting together in Groups while creating money, value, energy, wealth, capital and power. 

The individual acting alone is a dead end.  The individual acting alone isolated in the back woods or on a desert island is a dead end.  The individual acting alone as “I am the only one!” is a dead end.  The individual trying to act alone while attempting to concentrate all the money, value, energy, wealth, capital and power into his hands is a dead end for himself, all other individuals, families, organizations, societies, nations, mankind and environments.  This is the Capital Destroying Capitalist, “I am the only one!”

For prosperity and survival of all individuals, families, organizations, societies, nations, mankind and environments, it is very important for the Producers of the commodities, trades, goods and services to be rewarded for their production.  The reward must be very close to exactly what the value of their production is measured at. 

There are forms of Socialism where prosperity is created and people survive very well.  There are forms of Socialism where money is taken from the Producers and transferred to the non-producers and counter-producers and prosperity is harmed extremely.  Prosperity is harmed most when money, value, energy, wealth, capital and power is allowed to be transferred to a few rich and powerful individuals without an exchange for it.

There is only one way to prevent money from being taken from the Producers and given to non-producers and counter-producers.  That way is for the Producers to stand up and take full responsibility for the money, value, energy, wealth, capital and power they have created through work and labor.  There is no other way.  Any other system set up to protect the Producers can be infiltrated by the counter-producers and perverted to operate for the benefit of the counter-producers.    

Man is very social.  Man prospers very well when working and laboring in Social Groups.  As long as Producers are rewarded correctly for their production while laboring and working in Social Groups there will be much prosperity. 

Producer Rewarded Open Market Economics
The Science of Economics
By Rp Obrigewitsch

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Monday, August 26th, 2013 Producer Rewarded Economics No Comments

4. Production, Exchange Value and Money

Revised November 11, 2913

This is the third set of Axioms in the Axioms of Economics.  This is the Production, Exchange Value and Money set.  This set includes 5 sections of Axioms.  The five sections include Axioms in the Economics Equation section; the Definition of a Producer section; the Exchange Value section; The Relationship of Production and Money section; and The Relationship of Production to Commodities, Trades, Goods and Services section

There are 22 Axioms in the Production, Exchange Value and Money set.

 The Axioms in this set give the equation on how production comes about.  The Producer is defined.  There are Axioms related to the relationship of production to commodities, trades, goods and services and how production and money are related.

Economics Equation:

50.         Economics reduces down to one basic, that basic is production.

Idea + Space + Energy + Matter + Directed Doing = Production

51.         Economics is the Science of energy.

52.         Energy is generated or created during the process of production.

Definition of a Producer:

53.         A Producer is an individual who:

A.     Creates a good or a service.

B.     The good or service must be needed and wanted.

C.     The good or service must be marketed on the Open Market, open to all on equal terms.

D.     The good or service must not harm the prosperity of the individual, family, organization, society, mankind and environment.

54.         Producers are the main beams, support structures and backbone of a family, society, organization, nation, mankind and environment.  The prosperity of individuals, families, organizations, societies, nations, mankind and the environment rests on the backs of the Producers.

 55.         Producers project into the future.  They estimate the future needs of individuals, families, organizations, societies, nations, mankind and the environment.  They estimate and evaluate future commodities, trades, goods and services.

56.         Producers mock up models of their future production.  They mock up these models in their personal mental space.  They then transfer these mockups into the physical universe during the process of production.  The result is a final produced product.

57.         Producers generate energy.  They convert this energy into money, value, wealth, capital and power through the action of production.

Exchange Value:

58.         Exchange value is created through the production of commodities, trades, goods and services.

59.         Exchange value is represented by a money symbol.  The money symbol is in the form of coin, gold, paper, shells, beads, etc.

60.         Exchange value is the part of money that gives money its power.

Production and Money, the Relationship of:

61.          The act of creating money is a group function.

62.         It takes Producers, working together in creating commodities, trades, goods and services and trading these goods and services on an Open Market, to create money.

63.         Production rate and production quality determines the value of each money unit and the value of the money supply as a whole.

Corollary 1:  Value, that money represents, is being continually created, day after     day, by the Producers through production rate and production quality.

Corollary 2:  When production increases the supply of quality commodities, trades, goods and services on the Open Market, the value of these goods and services decreases due to decreased demand. 

This increases the value of money.  With the value of commodities, trades, goods and services decreasing, each money unit can purchase more products.

Corollary 3:  A low supply of quality commodities, trades, goods and services on the Open Market will increase the value of these commodities, trades, goods and services due to increased demand. 

This decreases the value of money.  It takes more money units to purchase these commodities, trades, goods and services.

Corollary 4:  The value of commodities, trades, goods and services relates inversely to the value of money. 

As the value of commodities, trades, goods and services increases it takes more money units needed to purchase these commodities, trades, goods and services.  Each money unit has less value.

As the value of commodities, trades, goods and services decreases it takes less money units to purchase these goods and services.  Each money unit now has more value.

Corollary 5:  As production rates increase, money increases in value. 

When the Market is flooded with commodities, trades, goods and services their value drops because of lower demand.  Now a money unit purchases more commodities, trades, goods and services so it has more value and also more power.

Corollary 6:  As production rates decrease, money decreases in value.

When there is a shortage of goods and services on the Market their value increases because of higher demand.  Here money units purchase fewer goods and services per money unit.  Money now has less value and less power.

Corollary 7:  The value of money is directly related to production rate.

Corollary 8:  The value of money fluctuates with the level of production backing it.

64.         A Nation with a high money value is a Nation with a high production rate.  Conversely; a Nation with a low money value is a Nation with a low production rate.

65.         A Nation with a high production rate is a Nation with a high money value and great wealth, energy, capital and power.

The Relationship of Production to Commodities, Trades, Goods and Services:

66.          Production is always being exchanged for production with or without money as a medium of exchange.

67.         Production rate determines the value of commodities, trades, goods and services.

68.         The value of commodities, trades, goods and services is inversely related to the level of production where demand is present. 

As the level of production decreases, the value of commodities, trades, goods and services tends to increase in a demand Market.  Conversely, as the level of production increases, the value of commodities, trades, goods and services tend to decrease in a demand Market.

69.         Production level is always directly related to the value and demand for this production.

70.         Demand generates the value for each commodity, trade, good and service.

71.         As demand increases for commodities, trades, goods and services the value of the demanded commodities, trades, goods and services increases. 

This, increased product value, attracts the attention of Producers.  Effort forces and ideas are generated by Producers.  The Producers use ideas to direct these effort forces, increasing production rates for these demanded commodities, trades, goods and services.

Producer Rewarded Open Market Open Economics
The Science of Economics
By RP Obrigewitsch
Revised November 11, 2013

 

 

 

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Wednesday, October 24th, 2012 Axioms of Economics No Comments

6. Review

Revised November 14, 2013

An Economic System is really and exclusively made up of Producers.  The Producers create the Economic System and operate it.  They create prosperity for the societies.   Any non-producer or counter-producer activity is destructive to Economic Systems and prosperity.  The non-producers and counter-producers destroy prosperity for themselves, Producers and societies.

Producers are in or inside the workings of a prosperous economic system.  They create and generate the energy for the economic system.  They give it life and prosperity.  They apply the rules or Axioms of Economics to the economic system.  The non-producers/counter-producers are outside of the economic system, they take the energy out of the system and destroy the system.  They refuse to apply or use rules or the Axioms of Economics in economics.  Economic systems with the presence of non-producers and counter-produces are receding systems.  These economic systems sink into recessions and depressions.  The non-producers and counter-producers take the life and prosperity out of an economic system.

We will look at economic systems and review how they came into existence through the directed energy thrusts of the Producers.

We have seen the evolution of how money value is created and backed.  We have also seen the importance of maintaining a Constant Money Supply.  Let’s review the evolution of the economic model.  The economic model is a step by step evolution on how money is created and why it is important to maintain a Constant Money Supply.

First:  There are individuals in a group of people producing commodities, trades, goods and services.

Second:  The people in the group need and want each others commodities, trades, goods and services.

Third:  At first these commodities, trades, goods and services were exchanged in ratios to each other among the members of the group.  This is called bartering.

Fourth:  These ratios define the exchange rates or exchange values of the commodities, trades, goods and services.

Fifth:  It became apparent that a symbol was needed to represent the exchange value of the commodities, trades, goods and services.  A medium of exchange was developed.

Sixth:  A symbol was created to represent the exchange value and it was called money.  This symbol became the medium of exchange and it is used in trading commodities, trades, goods and services on the Open Market.

Seventh:  This symbol represents the exchange value of commodities, trades, goods and services, in defined terms, called money units.

Eight:  Continued production creates more exchange value and this exchange value backs the symbol called money.  The exchange value gives money its value, energy, wealth, capital and power.

Ninth:  Increasing production increases the exchange value inherent in each money unit and in the money supply.

Tenth:  It became obvious that when the money supply is held constant the Constant Money Supply standardizes the money unit as a unit of measure.  This standardized unit of measure is used to estimate, assess or ascertain the exchange value of commodities, trades, goods and services.  It is also discovered that the economic system becomes secured and standardized when the money supply is held constant.  A Constant Money Supply provides security preventing the transfer of exchange value, money value, energy, wealth, capital and power away from the Producers without an exchange returned for it.  A Constant Money Supply prevents the non-producer and counter-producer from stealing the value, energy, wealth, capital and power away from the economic system and from the Producers of the value, energy, wealth, capital and power.

There are standardized units of measure for length, weight, volume etc.  These standardized measures allow the Producers to function efficiently.  These standardized measures lend efficiency to the Open Market and the economic system.  They protect the Producers of the commodities, trades, goods and services against the non-producers and counter-producers.  It is unimaginable to conceive a society or an economic system without standardized units of measures for length, weight or volume.  It is also hard to conceive an economic system without a standardized unit of measure for exchange value, the money unit.  The money unit must be standardized in order for Producers, families, organizations, societies, nations, mankind and the environment to prosper.

There are very few if any Constant Money Supply nations or economic systems remaining on the planet today.  The lack of Constant Money Supply nations and Economic systems is the source of much of the economic turmoil experienced on the planet today.  In an economic system lacking a Constant Money Supply, the non-producers and counter-producers have a field day expanding money supplies.  As they expand the money supply they steal the exchange value straight out of the money units, already in existence, and out of the economic system.  They steal the value, energy, wealth, capital and power out of the economic systems.  A lack of a Constant Money Supply gives non-producers and counter-producers a huge opening into the economic system and into the wallets and purses of the Producers.

A nation or economic system lacking a Constant Money Supply is like having a bank without doors, windows or walls.  The non-producers and counter-producers have almost total free rein in stealing the exchange value, energy, wealth, capital and power out of the money units and out of the economic systems as they expand the money supply.

A nation or an economic system with a Constant Money Supply is like having a bank with very secure doors, windows and walls along with absolute explosive proof vaults.  The non-producers and counter-producers have no access to money by expanding the money supply.  They are sealed out of the economic system and out of the wallets and purses of the Producers.  The only way they can have access to money is when they become Producers.  They become Producers by creating commodities, trades, goods and services and marketing these commodities, trades, goods and services on the Open Market in exchange for money units.  This is the only way anyone can be in an economic system.

Eleventh:  Gold was settled on as the most stable material to use when creating a Constant Money Supply.  It is fairly rare.  It is difficult to bring more gold into existence, making it difficult to expand the money supply.

After the money unit concept came into practice another problem developed.  That problem was, “How are we going to find a money unit symbol that is set at a specific number of money units in circulation at one time?”  Gold was eventually settled upon.  Gold wasn’t 100% set at a specific number of money units but it was as close as they could get at the time.  There are no absolutes in this universe.  Gold was used because it was as close as they could get as an absolute for maintaining a Constant Money Supply.  Establishing a Constant Money Supply with gold created a high level of stability and consistency in the money unit and the economic system.

There are times when the supply of gold was not held constant.  This caused economic collapses to occur. There are examples of where the gold money supply was expanded causing failed economic systems.

After Spain’s discovery of South and Central America, they brought huge sums of gold over to Spain from the Americas.  Their gold money supply was greatly expanded.  The expansion, of the gold money supply, lead to a great inflation.   Spain invested this new gold into building a great Navy and military power, leading to an economic collapse in Spain.  (This is taken from the History of Economics publication.)

It is noted here that over-spending on military is counter-production.  It is destructive to the society that has to carry such a heavy burden.

Gold had been used to maintain a Constant Money Supply.  In Spain the Constant Money Supply construct was violated.  This became an instance of non-producers and counter-producers stealing the value out of the money units in circulation, transferring the value to the new introduced gold.  This led to a great devaluation of the gold in Spain and a failed economic system.  Non-producers and counter-producers took much value out of the gold by expanding the amount of gold in circulation without exchanging production for it.

The Producers over time developed economic systems.  Step by step, they brought economics systems to more efficient, secure, standardized and prosperous levels.  Unfortunately the non-producer and counter-producers continued to follow along, covertly and overtly, developing destructive methods used to steal the money value, energy, wealth, capital and power out of the economic systems and from the Producers.

The technology developed here in Producer Rewarded Open Market Economics has given us tools we can use to create a prosperous economic system.  We can also use this technology to protect and secure the Producers and their production.  This technology can be used to standardize economics systems and money units.  Applying the technology of Producer Rewarded Open Market economics will bring about efficient and secure prosperous economic systems where the Producers can prosper; where families can have a bright and secure future; where societies can grow and expand in prosperity; where Nations can live and exist side by side without the presence of war or the threat of war.  Mankind can have a future filled with hope and prosperity.  We will find environments free of the poisons and destruction laid down by the non-producers and the counter-producers.

Producer Rewarded Open Market Economics
The Science of Economics
By: RP Obrigewitsch
July 22, 2012

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Sunday, July 22nd, 2012 Constant Money Supply No Comments

3. Medium of Exchange

Revised November 13, 2013

This article is the third article in the series of articles covering Axiom four, “Maintain a Constant Money Supply.”

A medium of exchange began to be needed and wanted in order to make the transfer of production value more efficient and practical.

With the absence of a defined money unit, we found products being traded in ratios to each other by the Producers to satisfy their needs and wants or demands.  This was the system of exchange in economics before the money unit was conceived and developed.  The money unit became the medium or intermediate step where value could be transferred during the sale of products on the Open Market.  The money unit with its newly transferred value could be used to purchase other products.  The symbol of the money unit, used for the value transfer, has had many forms down through the ages.

Production Value is the exchange value commodities, trades, goods and services have in relation to each other when exchanged on the Open Market, a Market that is open to all on equal terms. 

 Value is importance, worth or usefulness of a commodity, trade, good or service.  Competition among commodities, trades,  goods and services on the Open Market establishes the importance, worth or usefulness of each commodity, trade, good and service.  This competition is propelled by the forces of demand.  The needs and wants, placed in terms of demand, thrust forth by the Producers, establish the importance, worth or usefulness of commodities, trades, goods and services.  Competition on the Open Market along with the demands of the Producers gives commodities, trades,  goods and services their value.

Demand is a directed force put forth by Producers driving the competition on the Open Market.  The competition doesn’t just happen by itself; it is driven by a directed generated energy force.  This directed energy force is created by Producers.  It is an energy force directed in the direction of prosperity.  This force gives the Open Market its life.  The Open Market is like a living entity driven by the directed demand energy created by the Producers.

You could say the Open Market is like a living entity.  The Open Market gets its energy from the Producers.  This energy comes from commodities, trades, goods and services marketed on the Open Market and from Producer directed demand forces.  The Open Market is living, it is dynamic.  Producers create the Open Market by placing their commodities, trades, goods and services on the Open Market.  They then generate demand energy which they use to direct the competition among commodities, trades, goods and services.  Producers put life into the Open Market.

When non-producer and counter-producers enter into a Market they pull energy out of the Market.  They pull the market into recessions and depressions.  They pull the life out of the Market.  They suck the energy out of the organizations, societies, nations, mankind and the environment.

When the Market is broken down to its basic terms; we are really exchanging energy for energy.  When a non-producer or counter-producer enters into a Market they suck the energy from the Market.  They take commodities, trades, goods and services out of the Market without exchanging self-produced commodities, trades, goods and services for them.  They in effect take energy out of the Market without replacing it with energy of their own.  This act drains the Producer, families, organizations, societies, nations, mankind and environments of energy.  It brings about a state of economic decline and puts Producers, families, organizations, societies, nations, mankind and environments on a path receding away from prosperity.

There is only one true Market.  That true Market is the Open Market, open to all on equal terms.  Whenever non-producers and counter-producers enter into an Open Market even very slightly that Market is no longer open to all on equal terms.  It is a Market with a negative energy flow.  That energy flow is out of the Market.  This gives a receding economic condition.  When we have a true Open Market energy is flowing into the Market.   This gives a prosperous economic condition.  It is very important to maintain a Market where energy is flowing into the Market.  This leads to prosperity.

The Standardized money unit is the constant unit of measure that represents production value.  It also represents energy, wealth, capital and power.

A Constant Money Supply standardizes the money unit as a unit of measure for production value and Producer generated energy.  It is very important to maintain a Constant Money Supply. A Constant Money Supply gives a positive energy flow in the Open Market and maintains the Market as an Open Market.

An expanding money supply is a money supply that is not held constant. An expanding money supply causes a negative energy flow in the Open Market.  Money received by expanding the money supply without placing production on the Market causes a negative energy flow away from the Market. In this case the energy flow is from prosperity to recessions.  The economic conditions for individuals, organization, families, societies, mankind and environment are on a declining path.  Expanding money supplies destroy Open Markets and prosperity.

When the value of the dollar was floated in 1971 it was taken off the Gold Standard.  The money unit was floated.  Then the money supply could be expanded by a Central Bank at the whim of the operators of the Bank.  The dollar was now not standard.   It was no longer a standardized unit of Measure.  The result for the United States is an economic system that is no longer standardized.  Today this economic system is operating with a money unit whose value is altered anytime the central bank expands the money supply.  The Gold Standard was removed, as a way to maintain a Constant Money Supply.  The removal of the Gold Standard allowed the money supply to be expanded by the Central Bank.

Before 1971 the money supply was held constant by defining each ounce of gold to be equal to 35 dollars.  The amount of dollars allowed to be in circulation was equal to 35 times the number of ounces of gold held in a vault.

Expanding the money supply is like allowing the Meter or Pound to be arbitrarily changed in size and weight.  This would be allowing these standardized units of measures to change over time.  This would cause chaos throughout the societies.  Floating a money unit, instead of holding it as a constant unit of measure, is an idea made by counter-producers and non-producers.  From the moment they float the money unit, and from then on, they can continue to steal their money value, energy, wealth, capital and power from the Producers by expanding the money supply.  There is a belief that money supplies must be expanded to maintain economic well being.  When Producers and only Producers of the money are rewarded, money supplies can be held constant and the economic systems move toward more prosperity.  Expanding money supplies rewards non-production and counter-production.

A Constant Money Supply maintains a very stable Medium of Exchange

 Money, as the Medium of Exchange, is the intermediate step used during the exchange of commodities, trades, goods and services on the Market.

When money came into existence, money added a step in the exchanging of commodities, trades, goods and services on the Open Market.  Instead of exchanging commodities, trades, goods and services directly for other commodities, trades, goods and services; the commodities, trades, goods and services were first exchanged for money.  The value of the commodities, trades, goods and services was transferred to the money unit.  The money unit was then used to exchange for other commodities, trades, goods and services.  Value contained in the money unit was then transferred to another Producer for his/her commodities, trades, goods and services. This is when the money unit became the standardized measure for the value of commodities, trades, goods and services.  This is why it is very important to maintain a Constant Money Supply.  When the money supply is not held constant but allowed to expand, the money unit as the Medium of Exchange loses its standardization.  When the money unit loses its standardization economic systems get destroyed.

 It is much easier to transfer production value to a money symbol, a Medium of Exchange, than it is to transport commodities, trades, goods and services around to make exchanges directly among them.   Once the product value is transferred to the money symbol, the Medium of Exchange, it is much easier to make purchases of other Producer’s commodities, trades,  goods and services. The concept of a money unit came into existence to act as an intermediate step during the exchange of commodities, trades, goods and services.

Commodities, trades, Goods and services must be exchanged on the Open Market in order to determine the correct production value for each commodity, trade, good and service.  When commodities, trades, goods and services are exchanged on a Market that is not an Open Market, not equal to all on equal terms, production value will not be correct.  For example; in Markets where monopolistic practices are allowed, the production value created through a monopolistic individual or organization will usually be incorrectly higher.  Monopolistic practices are a form of rewarding non-production and counter-production.  Rewarding non-production and counter-production will lower money value.

Only where all Producers are in the Market on equal terms and only Producers are allowed to participate in the Market will the production value of all commodities, trades, goods and services exchanged on the Open Market be correct.

Rewarding non-production and counter-production places more money in circulation in relation to commodities, trades, goods and services on the Market.  This leads to fewer commodities, trades, goods and services being on the Market in relation to money in circulation.  The money value goes down as the non-producers and counter-producers bid up the prices of the existing commodities, trades, goods and services on the Market.  When money is given to non-producers and counter-producers they are taking money without placing commodities, trades, goods and services on the market.  This causes more money to be in circulation.  This money is found in the pockets of non-producers and counter-producers.  They use this money to bid up the prices of commodities, trades, goods and services on the market.  This will cause money to lose valueIt requires more money to purchase the same products.  Inflation is the result of having fewer commodities, trades, goods and services on the Open Market in relation to money units in circulation.

In conclusion; during Marketing, value is transferred from commodities, trades,  goods and services to the medium of exchange measured in money units.  Money units become packets of value and can be much more easily transported over distances and used to purchase other Producers’ production. The money unit, used as a unit of measure along with a Constant Money Supply, increases the efficiency of and standardizes the economic system.  A medium of exchange composed of money units was established.  This medium of exchange becomes standardized when the money supply is held constant.

Producer Rewarded Open Market Economics
The Science of Economics
By R P Obrigewitsch
June 29, 2012

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Friday, June 29th, 2012 Constant Money Supply No Comments

2. Production and Prosperity

Revised November 13, 2013

Production is the basic thrust of all mankind toward prosperity.  Production and prosperity go hand in hand.  Production by the Producer creates or generates prosperity.  Production enhances the prosperity of the Producer.  Production increases the Producers ability to exist.  The prosperity thrust of the individual demands production take place to forward the individual in his quest to exist.  This production has exchange value.  This exchange value is determined or generated by the needs and wants (demand) of each producer in the societies.  This exchange value is found to be inherent in what the individuals of each society have agreed to be defined as “their” money unit.

We will examine how money is created through production.  If one person produces milk, another person produces eggs, another produces coats, another produces computers and another producers cars.  We then have these people producing in their specialties.  Each of these Producers needs and wants (demands) the production created by the other Producers.  Each Producer needs and wants (demands) the production of other Producers for his or her prosperity, consumption or esthetic admiration and/or pleasure.

Producers have developed a system of exchange among themselves to accommodate their demands for each others production.  At first a barter system was set up where producers traded commodities, trades, goods and services with each other based on the value they assigned to each commodity, trade, good and service.  The value was generated by the amount of commodities, trades, goods and services available in respect to the demands for the commodities, trades, goods and services.  If there was an abundant supply of a specific good and the need was low for it, the demand was low.  A low demand would give a lower value for that good.  If there was a low supply of a specific good or service and the need for it was high, the demand would be high.  A high demand would give a high value for that good or service.

From this working together of need, demand and supply, the Producers worked out an exchange ratio among all commodities, trades, goods and services on the Market.  This ratio is the exchange relationship among all commodities, trades, goods and services on the Market.   The exchange relationship shows the number of times the value of one commodity, trade, good or service is contained within the other commodities, tradies, goods and services on the Market.  This is called the exchange rate.

We may find one hundred dozen eggs being traded for one coat, two dozen eggs being traded for on gallon of milk, fifty gallons of milk being traded for one coat, five hundred dozen eggs being traded for one computer, two hundred gallons of milk being traded for one computer or ten computers being traded for one car, etc.  These are the trading ratios which are being used by the Producers to achieve equity in product value when trading their products directly.  These ratios have established exchange value in terms of one product to another.

From this information or data it can be deduced that products have exchange value, generated by demand from Producers, which can be defined in terms of all other products.  In fact, all products created by Producers, throughout mankind, have exchange value which can be defined in terms of each other.

For example; one dozen eggs is equal in value to one/one hundred (1/100) of a coat.  One coat is defined to equal one hundred (100) dozen eggs in value.  One car is defined to equal one hundred (100) coats or ten thousand (10,000) dozen eggs or five thousand (5,000) gallons of milk or ten (10) computers.  We could define the exchange value of all production based on each product and determine how to exchange commodities, trades, goods and services based on that specific product.  The selected product could be dozens of eggs.  We could determine the exchange rate of all products based on the value of dozens of eggs.  As we can see this would be very unworkable.  The egg production would go wild. Everyone would be growing eggs as a short cut to having money.  This would lead to a constantly expanding medium of exchange (eggs) and a collapsed economic system.

Do you see how the value of commodities, trades, goods and services are determined on the Open Market?  One could go on and complete tables and tables defining the exchange value of each product produced by all members of mankind in terms of all other products produced by all of Mankind.  This becomes a very, very bulky and unworkable system.  We need some sort of simplification and standardization here.

Producer Rewarded Open Market Economics
The Science of Economics
By RP Obrigewitsch
Revised November 13, 2013

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Thursday, June 14th, 2012 Constant Money Supply No Comments

1.6 Why Money Velocity Slows

Revised November 17, 2113

We are talking about money velocity here.  We are talking about why money velocity slows and why it speeds up.  Money velocity is the flow of energy.  It flows throughout a society.  Money is a symbol that represents production value, production energy and production power.  It also represents wealth and capital.  In this article we will look at money as a “symbol of production energy.”  Production energy is the prosperity energy for an individual, family, organization, society, nation and mankind.  In a society, money velocity increases and decreases depending on the production level of the society.  Money velocity also depends on the Producers pay or reward for their production. When rewarded production increases, money velocity increases.  When production decreases, money velocity decreases.  When production increases and the Producer is not rewarded for creating the production, money velocity decreases. When rewarding non-producers increases, money velocity decreases.   Money velocity is the rate at which money changes hands in a society.   Money velocity is the rate at which money energy flows through a society.  The faster the rate of money energy flow, the more prosperity there is in a society.

  •  AXIOM 151:  Money velocity is the rate at which money changes hands while being exchanged on the Open Market for products (commodities, trades, goods and services.)
  •  AXIOM 151.1:  As the flow of money energy increases through the hands of the people in the society when buying and selling products (commodities, trades, goods and services), their affluence level increases.
  •  AXIOM 152:  Increased production efficiency increases money velocity.

 Early in the research and writing of Producer Rewarded Open Market Economics there has been much attention placed on the rewarded wealthy non-producers and counter-producers.  There has been much attention placed on the catastrophes caused by rewarding wealthy and powerful non-producers and counter-producers.   The wealthy and powerful non-producers and counter-produces cause great destruction.  However, all forms of rewarding non-production and counter-production harm individuals, families, organizations, societies, nations, mankind and environments.  As we move into the future we will work on perfecting the Producer Rewarded Open Market Economic System.   Producers will become more aware of the consequences of rewarding all non-producers and counter-producers.  This awareness will allow us to prevent non-producers and counter-producers from taking money without an exchange for it.  The exchange must be in self-created products.  We will work at perfecting the Producer Rewarded Open Market Economic System.  We will work with the purpose of having a tremendous prosperity potential for all individuals, families, organizations, societies, nations, mankind and environments.

Other than natural and “God” given causes, the only reason why money velocity slows down and societies find themselves in recessions, depressions and chronic depressions stems from and only from rewarding non-producers and counter-producers.  This is the action of giving money to non-producers and counter-producers who place no production or not enough production on the Open Market in exchange for the money.  The action of rewarding non-producers and counter-producers is giving them money energy with no exchange for it.  This is allowing them to take money with no or not enough production on the Open Market in exchange for this money energy.  The action of placing money energy into the hands of non-producers and counter-producers brings about the destruction of money, value, energy, wealth, capital and power.  This destruction of money, value, energy, wealth, capital and power slows money and energy velocity rates in a society.  Recessions and depressions expand and grow deeper as rates of money and energy velocity slow down.

This type of economic practice is classified as Capital Destroying Economics.  Capital Destroying Capitalism is in this classification.  Capital Destroying Capitalism is the destructive part of Capitalism.  Capital Destroying Capitalism is in the classification of Capital Destroying Economics.    

Remember there are two classifications of Capitalism.  They are the prosperity creating types and the prosperity destroying types.   They are  Capital Producing Capitalism and Capital Destroying Capitalism.  The Prosperity creating types are classified as Capital Producing Economics.  They are Producer Rewarded Open Market Economics and Capital Producing Capitalism.

The prosperity destroying types are classified under Capital Destroying Economics.  They are Capital Destroying Capitalism, Communism and Fascism.  The reason the name Capital Destroying Economics was given was because rewarding non-production and counter-production literally destroys money, value, energy, wealth, capital and power.  This destruction brings about the destruction of Producing individuals, families, societies, nations, mankind and environments.

On inspection we find Communism, Fascism as well in the destructive classification of  Capital Destroying Economics.

This destructive classification of Capitalism, where wealth is concentrated with its power and influence into the hands of a few non-producers and counter-producers, causes great hardship and suffering.

Communism and Fascism are also destructive systems of economics.  These two systems also concentrate wealth with its power and influence into the hands of a few non-producers and counter-producers.  This activity also leads to great hardships and suffering.

What do these three destructive economic systems; Capital Destroying Capitalism, Communism and Fascism;  have in common?  The have a money velocity that is flowing very slowly.  Their citizens are living under great hardship and suffering.  They are mired in prolonged economic depressions.

We find, in the above three systems, the few powerful non-producers and counter-producers tend to be hiding.  The money, energy and power are concentrated into their hands.  They use it to have a tremendous influence on their societies and nations.  They use it to set up systems where they can take more money, value, energy, wealth, capital and power without exchanging production for it.  We find these rewarded non-producers and counter-producers hiding. They hide, grab and hold onto the money, value, energy, wealth, capital and power.  They horde and stop the flow of money energy.  They grab and hold onto material objects (Materialism.)  They become the money and objects they worship.  They become their expensive cars, boats, airplanes, houses and other material objects.  It could be said, “These rewarded non-producers and counter-producers are hiding in or as their objects!”   They hide grab and hold.  Their purpose is to stop the flow of money energy.  They have a tremendous negative effect on money velocity and prosperity in their societies.

These rewarded non-producers and counter-producers are hard to spot.  They hide, grab and hold onto money energy, production energy and prosperity energy.  They seldom stand up and admit their true purpose.  Instead they will hide behind other issues such as a balanced budget, abortion, gay rights and “create” enemies of the state to take attention off their real purpose.  They will argue issues such as abortion and gay rights.  When they get to power they will not handle these issues when they have the power to do so.  When in political power they will assert their hidden purpose.  Their hidden purpose is to concentrate more money, value, energy, wealth, capital and power into their hands.  They grab and hold more money, value, energy, wealth, capital and power.  They will use the enemies they “create” to promote war.  War is another means for the non-producers and counter-producers to transfer more money, value, energy, wealth, capital and power into their hands.  They steal the prosperity energy and production energy from the Producers.  They steal the value, energy, wealth, capital and power from the Producers.

We find long recessions and depressions.  We find a slowed money velocity.  This is caused by moving wealth from Producers.  The wealth is placed into the hands of a few powerful non-producers and counter-producers who have not created it.

There are tools to determine: What is production and what is non-production?  What is counter-production?  Who are the Producers? Who are the non-producers?  Who are the counter-producers?  There are tools to determine whether we are Capital Producers or Capital Destroyers.

What is a Product?

 A commodity, trade, good or a service is classified as a Product when it:

A.     is marketed on The Open Market (open to all on equal terms,)

B.     is needed and wanted and

C.     does not harm the prosperity to the  individual, family, organization, society, mankind, nation and/or environment.

Or it can be more fully explained by saying, “it causes the greatest prosperity to the greatest number of people.”   Another way of saying it is, “it causes the least harm to the greatest number of people.”

DEFINITION OF A PRODUCER:

AXIOM 23:  A Producer is a person who:

A.  Creates a commodity, trade, good or service,

B.  The commodity, trade, good or service must be needed and wanted,

C.  The commodity, trade, good or service must be marketed on the Open Market (open to all upon equal terms) and

D.  It must enhance or should not destroy the prosperity of the individual, family, organization, society, nation, mankind and environments.

AXIOM 24:  Producers are the main beams, support structure and back bone of a society and a Nation.  The prosperity of a Nation rests upon the backs of the Producers.

There is only one way to achieve optimum money velocity and be a Capital Producer and that is to reward the Producers of production.  There are many, many ways to place a drag on money velocity other than natural causes.  They all come down to rewarding non-production and counter-production.  Non-producers and counter-producers are the destroyers of capital, money, value, energy, wealth and power.

We can use the Technology in Producer Rewarded Open Market Economics to create and expand our prosperity creating economic system on this planet.  In the past we have been subject to the grab and hold (hoarders) running our economic systems.  This has always slowed money velocity bringing about recessions, depressions and wars.  The Producers have always sought to create money, value, energy, wealth, capital and power.  The Producers have always sought to increase the money velocity.  They have sought ways to make sure everyone who produced received their production value and production energy in exchange for what they have created.

As Producers, we can move forward with confidence, knowing what we are doing is correct and very right!  We can confidently move forward producing prosperity,  energy, wealth, capital and power for ourselves, families, organizations, societies, nations, mankind and environments.

Producer Rewarded Open Market Economics
The Science of Economics
By: RP Obrigewitsch
March 4, 2012

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8. Free Market Construct

Revised November 18, 20113

The Free Market Construct will give you a contrast with the Open Market Construct.  The Open Market is governed by exact prosperity creating technology.  The Free Market has very little if any prosperity creating technology.  The little it has in prosperity creating technology is being violated to the extreme.  The Free Market has been taken over largely by rewarded non-producers and counter-producers. They sit on the demand side of the definition of the Free Market and take money, value, energy, wealth, capital and power without placing supply on the market. The rewarded non-producers and counter-producers continually drain organizations,  societies, nations and mankind of the money, value, energy, wealth, capital and power. This money, value, energy, wealth, capital and power is created by the Producers.

It is very important to remember, the Free Market is a Market.  It works like any Market.  It is always working 24/7 in establishing the value for all commodities, trades, goods and services placed on it.  Even when non-producers and counter-producers take money without placing supply on the Market, the Market sets value.  However, the value of these commodities, trades, goods and services is higher than it should be.  This is because non-producers and counter-producers make demands without balancing them with supply.   The Market senses a low supply in relation to demand and the prices go up.  This is commonly called inflation.  When supply is low, prices go up.  When supply is high or abundant, prices go down.

 The definition of the Free Market is, a Market in which prices are controlled by supply and demand, without government regulations and restrictions. 

  • The Free Market allows for advantages by non-producers and counter-producers.  It allows monopolies and all other ways a non-producer and counter-producer can dream up.  They use these advantages to take money, value, energy, wealth, capital and power off the market without exchange for it with supply.
  • Technically speaking the Free Market should not be open to non-producers and counter-producers.  The definition of Free Market “strictly” implies that commodities, trades, goods and services must be supplied in order to demand or take money from the Market.  Supply, “in supply and demand,” implies commodities, trades, goods and services.  Commodities, trades, goods and services must be placed on the Market in exchange for any money received.  The money can be used to place a demand on the Market for other products.
  • Non-producers and counter-producers use one half of the Free Market definition.  They use the demand side of the Free Market definition.  They leave out the supply side.  Or, they fix and control the supply side to their advantage.
  • The non-producers and counter-producers enter into the Free Market and take money, value, energy, wealth, capital and power from it without a product exchanged for it.  This is catastrophic for individuals, families, organizations, societies, nations, mankind and environments!   Today in 2011 we are experiencing the result of this activity, on the Free Market, by non-producers and counter-producers.  We are in a deep world wide recession as a result.
  • The Free Market has no restrictions except keeping all government regulations out of it.
  • The Free Market does not restrict monopolies or any other way non-producers and counter-producers control the supply and demand.  They use methods of controlling supply and demand to receive more money than what their products are worth.
  • The Free Market doesn’t prevent people from taking a non-productive and counter-productive advantage in the Market.
  • The greatest difference between the Open Market and the Free Market is; “the Open Market does not allow for non-producer and counter-producer participation.  The Free Market allows for non-producer and counter-producer participation.”  Non-producers and counter-producers have wrecked many a society and nation.  They have been allowed to participate in the Market without exchange for the money, value, energy, wealth, capital and power they received.
  • Non-producers and counter-producers are found in all levels of a society.  They are located from the poorest among us all the way to the wealthiest among us.  There are no exceptions; non-producers and counter-producers, whether rich or poor, are non-producers and counter-producers.  They are a heavy burden and liability for organizations, societies, nations and mankind!

Producer Rewarded Open Market Economics
The Science of Economics
By R P Obrigewitsch
December 19, 2011

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Monday, December 19th, 2011 Open Market Economics No Comments

6. Free Market, Non-existent!

Revised November 18, 2013

The Free Market today is almost non-existent.  It is buried beneath all the destructive schemes, dreamed up by non-producers and counter-producers.  They use their destructive schemes to take money without an exchange for it. The Market is there working like it should be working.  It is establishing value for commodities, trades, goods and services that get placed on the market.  However, the market is covered in a shroud of unethical, immoral, and lawless schemes.

This shroud is composed of monopolies and  government sanctioned monopolies.  It is also composed of schemes of speculation that involve no production.  Government subsidies, welfare for the rich and welfare for the poor are also part of this shroud.  This shroud also includes massively over allocated military spending.   People who hold positions and do not produce at all or produce less than the money received in pay are a part of this shroud.  Other areas covered in this shroud are other massively wasteful government programs, people in power receiving huge amounts of money with no or not enough production in exchange for it; illegal drug trade and excessive unneeded legal drug trade.

The shroud includes individuals in governments.  They sit in a position of power, redistributing the money, value, energy, wealth, capital and power away from the Producers.  They placing it into the hands of non-producers and counter-producers.  Capital Destroying Capitalists, Communism, Fascism, Right Wingism and Left Wingism have as their central thrust to redistribute the money, value, energy, wealth, capital and power of a nation.  They place it  into the hands of non-producers and counter-producers.

When you study the Market you will see through this shroud and see the Free Market working.  It is a Market, after all.   “All Markets have supply and demand forces at work establishing the value for all commodities, trades, goods and services on the Market!”

Producer Rewarded Open Market Economics
The Science of Economics
By RP Obrigewitsch
December 4, 2011

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Sunday, December 4th, 2011 Open Market Economics No Comments

4. Market Action

Revised November 17, 2013

The market action of establishing the value for commodities, trade, goods and services is happening continuously twenty four hours a day. This market action takes place on all Markets whether Open Markets or not.  It is an action inherent to Markets.  As long as there are producers, producing commodities, trades, goods and services and exchanging them with each other, this Market force is at work.  It is a force working to establish the prices even with all the destructive out exchange taking place on the Market by the non-producers and counter-producers.  This force is always at work in the Market.  This is a natural force found in nature.

Even with all the muddle and confusion created by the non-producers and counter-producers this market action is taking place.  Of course the value of commodities, trades, goods and services gets placed incorrectly.  The value is usually higher than it would be when non-producers and counter-producers are allowed in the Market.

If non-producers and counter-producers become Producers they would create products.  They would place their created commodities, trades, goods and services on the Market.  This increased volume of commodities, trade, goods and services would cause a drop in prices across the Market.  There would be an increase in products on the Market in relation to money in circulation.  As production volume increases, demand tends to drop off and prices drop as a result.  Rewarding non-production and counter-production causes prices to rise because the volume of commodities, trades, goods and services is lower.  The non-producers and counter-producers are exchanging little or no commodities, trades, goods and services for the money they receive.   This causes demand to rise and prices follow along.

The Market has a directed effort to set the value for commodities, trades, goods and services that are competing with each other. The Market forces take place “anywhere at anytime” producers create a Market by exchanging commodities, trades, goods and services with each other or for money.

Producer Rewarded Open Market Economics
The Science of Economics
By: R P Obrigewitsch
December 4, 2011

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Saturday, October 8th, 2011 Open Market Economics No Comments

1.1 The Money Velocity Cycle

revised November 16, 2013

The money velocity cycle is an action that occurs over and over again daily, weekly and yearly in a producer rewarded Open Market society.  Money velocity is the rate at which money changes hands in a society, nation and all mankind.  Money velocity is the speed of flow of money.  It is about how rapidly money passes through the hands of individuals in organizations, societies, nations and mankind.  Prosperity results with increased money velocity.  Recessions and depressions result when money velocity decreases.  In societies and nations were there is much non-producer and counter-producer rewarding the money velocity in the money velocity cycle slows.  These societies’ and nations’ economic systems recede into depressions.

In order to develop a better understanding of money velocity and the money velocity cycle we will define velocity.  We will also look at Axioms related to money velocity and the money velocity cycle.

The definition of Velocity (Thorndike Barnhart, World Book Dictionary.)

Velocity:  N. 1. Quickness of motion; speed; swiftness; rapidity.  2.  rate of motion in a particular direction.  3.  the absolute or relative rate of operation of action.   Adj.  of or having to do with the rapidity of rate of motion or action: velocity ratio.

Derivation [< Latin Velocitas < Velox, Ocis  Swift]

 The following three Axioms will cover money relating to how money has velocity.  I have discussed earlier that money is a symbol.  It is a symbol that represents value which is created by you the producer of commodities, trades, goods and services.  It is also a symbol that represents energy.  This is the energy you create or generate and convert into commodities, trades, goods and services as you create them.  Therefore, money is a symbol, it represents the value of commodities, trades, goods and services you have created.  The value of the commodities, trades, goods and services is established when they are exchanged on the market.  The market must be an Open Market.  The Open Market must be open to all on equal terms.  Money, you receive in exchange for the created commodities, trades, goods and services you place on the Open Market, also represents the energy you create and convert into commodities, trades, goods and services.

I am going to be talking about this energy as it flows throughout the society, nation and mankind.  All people on the planet are connected together through this energy that money represents.  If a person is alive, no matter how much or how little, they have money energy flowing through them.  Only when they are dead does money energy cease to flow through them.

  • Axiom 151:  Money velocity is the rate at which money changes hands while being exchanged on the Open Market for commodities, trades, goods and services.
  • Axiom 151.1:  As money velocity increases while flowing through the hands of the people in the society, when buying and selling commodities, trades, goods and services on the Open Market, their affluence level increases. 
    • There is a corollary (corollary 1) to this Axiom: As money velocity decreases while flowing through the hands of the people in the society, when buying and selling commodities, trades, goods and services on the Open Market, their affluence level decreases.
  • Axiom 152:  Increased production efficiency increases money velocity.
  • When people get more efficient in production, they produce and place more commodities, trades, goods and services on the Open Market in a given period of time.  With more commodities, trades, goods and services entering the Open Market in a given period of time, more money changes hands over that period of time.  Here we see money velocity increase, which in turn increases prosperity.

The money velocity cycle is an action that occurs over and over again daily, weekly and yearly in a producer rewarded Open Market society.  In a non-producer and counter-producer rewarded society this cycle dies as does the society.  The American Indian societies, as they were known, died out because their ability to produce was shut down due to the intrusion of Immigrants across the Indians production territory.  Their money velocity decreased as their production levels dropped.  The Indians used money in the form of shells, beads etc.  They also used a barter system.  The use of a barter system also has velocity, it is called barter velocity.

We find the frequency of the money velocity cycle increase and decrease depending on the production level and producer pay or reward in the society.  When the money velocity cycle speeds up, the society becomes more affluent and prosperous.  When the money velocity cycle slows down, the society becomes less affluent and prosperous.

Money velocity gets its rates of motion from the level of production occurring in the society and the producers receiving all the money they have created in producing commodities, trades, goods and services.  When producers receive more money than they have created in their production they are receiving money that has been created by other producers.  This causes a decrease in money velocity and prosperity in their society.  When producers are paid less than their production is worth money velocity and prosperity in that society will decrease.  When producers are paid their productions worth, in money units, money velocity and prosperity are optimum.

During the first part of the money velocity cycle, commodities, trades, goods and services flow to the Open Market in exchange for money.  During the second part of the money velocity cycle, money flows to the Open Market for the purchase of commodities, trades, goods and services.  There is a continuous and varying velocity flow of money and commodities, trades, goods and services to and from the Open Market.

 The best way to get the optimum (best or most favorable) rate of motion in money velocity is to pay only those people who have produced and placed commodities, trades, goods or services on the Open Market.

Producer Rewarded Open Market Economics
The Science of Economics
By RP Obrigewitsch
April 4, 1993
Rev. August 22, 2011

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Monday, August 22nd, 2011 Money Velocity and Prosperity No Comments
 

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