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.