5. Creating Money

Revised November 14, 2013

It is important to note: The Producers who create the products create the exchange value and production value the money unit symbol represents.  The exchange value and production value is transferred into money units during the process of Marketing.  Since Producers have created the exchange value and production value they now own the money units.  They have created the value inherent in the money units received when marketing the commodity, trade, good or service.  You could say they “created the money.”  This money was created at the precise time the commodity, trade, good or service was created.  The Producer exchanges the commodity, trade, good or service on the Open Market, transferring product value to the symbol called money.  In essence the Producers are creating money when they are creating commodities, trades, goods and services and exchanging them on the Open Market

We can say; “The Producer producing one thousand (1000) dozen eggs per day is creating two thousand (2000) money units of exchange value per day.  The Producer producing ten (10) coats per day is creating two thousand (2000) money units of exchange value per day.  The Producer producing five hundred (500) gallons of milk per day is creating two thousand (2000) money units of exchange value per day.  The Producers producing five (5) computers per day are creating five thousand (5000) money units of exchange value per day.  The Producers producing one (1) car per day are creating thirty thousand (30,000) money units of exchange value per day.”  The exchange value of every commodity, trade, good or service produced by any of the Producers, in the realm of mankind, can be expressed in terms of money unit value when marketed on a Market. Only when commodities, trades, goods and services are marketed on the Open Market, open to all on equal terms, is the true and correct money unit value achieved.

It can be seen: All money is created by Producers (Workers and Laborers) who create commodities, trades, goods and services.  These products have exchange value.   The money symbol represents this exchange value.  Money with an absence of production does not exist.  It would have no exchange value.

Money is a material object.  In order for money to exist with value, energy and power it must have production taking place.  This value, energy and power is transferred to the money from the production.  The transfer takes place during the exchange of products for money on the Open Market.

As the Producers produce daily, they produce the exchange value and product value which backs money and gives money its energy and power.  Money is created through and backed by production.  With the absence of production, money has no power, energy or exchange value.  Money has no backing.  The production level of a society as a whole backs the value which is inherent in the money units and the money supply.  The production level of a society gives the money its value.  The money value in a society fluctuates with the production level of that society.

When production enterprises are moved from one Country to another Country, money power and value are lost to the Country moving the production enterprises out.  The country receiving the production enterprises gains money power and value.  This is what has been happening for the past 30 to 40 years in the United States.  Production enterprises have been moved to foreign countries.  These foreign counties have been gaining money power and value.  The United States has been loosing money value and power.

The power, energy and wealth of a Nation is directly tied to its production level, money value and money power.  The Nation moving production enterprises to foreign countries is literally transferring National and International Political Power to the foreign countries.  The United States has been transferring its’ Power to foreign counties.  The United States has been loosing Power and the countries where the production enterprises have been transferred have been gaining Power.

When the production level of a society is high, and the Producers are being rewarded for their production and the money supply is held constant, the money value of the society is high.  When the money supply is expanded money value is lowered.  When production level is high and non-producers and counter-producers are taking money with no exchange for it the money value declines.  When production levels are low the money value is low.  Any non-producer/counter-producer, out-exchange, activities lead to lower money value and lower production levels.

The act of creating money, value, energy, wealth, capital and power is done by the Producers who are also Workers and Laborers.  All money is created through and by some form of work and labor.  All wealth is created through and by some form of work and labor.  All capital is created through and by some form of work and labor.  There are no exceptions.  Labor gives a Nation its’ wealth.  Adam Smith discusses this in his Wealth of Nations book, published in the late 1700s.

There are three basic forms of Work and labor.  Work and Labor is achieved through; (1.) predominantly physical action, (2.) through a combination of physical action and mental action (3.) and/or through predominantly mental action.  These are all forms of work and labor.

Management also creates money, value, energy, wealth, capital and power.  Management uses a form of work and labor to create money, value, energy, wealth,  capital and power.  Management for the most part uses the mental action form of work and labor.  Management, despite its hate and attacks on producing workers and laborers, uses a form of work and labor to create money, value, energy, wealth, capital and power.  The money management receives in pay represents the value, energy, wealth, capital and power management created during production.  If management receives money, value, energy, wealth, capital and power without using any of the three activities of work and labor it is out-exchange.  Management is stealing money, value, energy, wealth, capital and power from the producing workers, laborers and the producing managers.

There should never be an antagonistic relationship between the producing laborers and the producing managers.  Both groups use some form of work and labor to produce commodities, trades, goods and services.  They exchange the commodities, trades, goods and services on the Open Market for money, value, energy, wealth, capital and power.  The solution is to pay all producing laborers, labor and management, the correct amount of money each one has created through the actions or activities of production.  All producing laborers are both management and labor working together in concert to fulfill their purposes of prosperity.

There are counter-producers who pass themselves off as managers and as laborers.  They need to be removed from producing enterprises.  Counter-producers cause much damage if allowed to exist in a producing organization.  They will destroy prosperity for themselves along with the prosperity for all producers, manager laborers and labor laborers, in a production Organization.  I have seen this in actual practice.  It is not an uncommon phenomenon.  Producing managers and producing laborers tend to have pity on these counter-producers or have fear of them and allow them to exist in the organization.  Then they can’t figure out why the organization continues to fail.

When an organization is failing look around and you will find counter-producers and non-producers sucking the energy out of the organization.  You will find counter-producers thrusting forth destructive actions that stop, impede or destroy the organization.  Don’t have pity on them. Simply remove them from the premises.  Don’t fear them for they are cowards and will turn tail and leave the area when they are exposed and when the  correct force and action is turned on them.

The counter-producer managers have for many years looked down on Labor.  They have made the word labor into a bad word.  They have kicked producing laborers around.  They have pushed producing laborers toward slavery and at times have enslaved the producing laborers.

Counter-producers in management have used this antagonistic attack on labor as an aid to take money, value, energy, wealth, capital and power from labor without production exchanged for it.  This attack is made in order to push the creators of the money, value, energy, wealth, capital and power down toward slavery and steal the money, value, energy, wealth, capital and power the producing labors have created.  There are those in management who would attack labor as a way to discredit laborers.  They are attacking and discrediting labor so labor won’t place a claim on the money, value, energy, wealth, capital and power the producing laborers have created.

Creating money, always, no exceptions, requires some form of prosperity directed action or activity.  The activity is either predominantly physical, predominantly mental or a combination of the two.  If one is receiving money without some form of prosperity directed action or activity that results in an exchangeable commodity, trade,  good or service that person is out-exchange.  That person is stealing money, value, energy, wealth,  capital and power.   It is being stolen from the producing laborers and producing managers who use prosperity directed actions and activities resulting in production.  All money, value, energy, wealth, capital and power is created through and by producing laborers and producing managers.  All production requires some form of work and  labor, be it work and labor from the conventional Laborer or work and labor from the conventional Manager.

Producer Rewarded Open Market Economics
The Science of Economics
By: RP Obrigewitsch
July 13, 2012