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Snap!
No, I am arguing that the price that people will pay for things determine what they are worth. Simple.
Every business will, once it has folded because it has no consumers and all it's stock is sat in a warehouse doing fuck all. At this point the stock might sell to the few people who want it once it's asking price has hit it's true value.
For those businesses that sell things for far lower then they could get that's just bad business.
No, those things that aren't worth making don't get made for very long. No matter how much labour has gone into them, if they have no value in the marketpace, they don't sell. It's end items that have value or not, the labour is irrelevant. Stuff that continually gets made is worth enough once sold to cover it's labour costs because it has enough value on it's on merits to cover them. The second that people don't want it anymore it's all over, regardless of the labour costs.
Yeah which is why it's bollocks. (Part 95.)
Now then, about modern banking. Do you know how it works? It's the key to your misunderstanding of economics I reckon.
Price only measures trading in an item, relative to the most commonly used good (in a free market economy) or fiat, worthless paper(in collectivist, socialist countries such as dominate the world today).
Look if you were to say that in a capitalist economy, labour costs determines what gets made over time, then I would agree with you. It's got fuck all to do with price or value though. Price is determined by the number of people with goods to trade with you for your product, their desire for them and the number you have and they have to exchange. Value is only able to be measured by this process.
Use value is impossible to determine, as it's entirely subjective, the only thing that can be measured is that fleeting moment of trade.
You can measure it all day, it still has nothing to do with the value of an item when you come to trade it. It's also not an objective fact.
The mistake here is that you think that there is a necessary relationship between consumers and producers. There ain't. Your reasons, methods and motivations, the amount of labour you have used, the expertise, the blood sweat and tears you pour into your product means fuck all to me when i have the item in front of me.
I'll either want it or not, and it will either be affordable to me or not. If I don't think it's worth what you are asking and no one wants what you are offering at a price that will cover your costs, you are going bust. Simple as.
in the sixties the western world was flooded with honda motorbikes from japan ...at less than they cost to manufacure.
along with many other goods.
the motorbikes wrecked the british motorcycle industry which was very healthy at the time.
it worked ...japanese motorbikes took over along with many other products.
they destroyed our manufacturing base and established their own market ...on a huge scale that is still dominant.
No, that actually proves my point, Blagsta. The only way that you can continually do it is to eventually have a market for the good that pays your costs out and someone willing to make a loss right now to get there. This means that over time things that cost more than their labour won't get made beyond the point that they are bailed out. Again, fuck all to do with it's value in the marketplace.
In fact, someone is buying the goods for more than the current market will pay for them, in expectaion of making more later. Once they stop doing this, because it's no longer worth it to them, the business will fail. All Rollies example has that is differnet is one huge customer in it.
The price of them is still set by the buyers, based on the buyers estimation of the item in question.
However, I'll never convince you of it because you're too convinced that you and only you knows how the world works, as shown by your bizarre ideas on the state. This is why I had you on ignore for so long.
Which means that you can produce things without matching those costs. This must mean that it isn't those costs which determine the price. Simple.
Exchange value does determine exchange value. Until you come to sell something it has no price in the marketplace. It has an exchange value only for the period it takes to exchange it. Then it has no known value again.
Seller + buyer = exchange at a price.
Seller - buyer = no value at any price.
If you are going to convince me "how the world works" you had better have better arguments than you have. Some facts would be good too. What's so bizzarre about equating belief in the "state" with early fundamentalist christianity? It only seems you are bizzarre if you are the fundie. Given that it's a belief of the same order, the cure for it would be of the same order. i.e. reliance on facts.
How would the LTV explain the worth of fiat currency then?
Bye klintock. :wave:
Does that disagreement make those things real? Or does it just mean that you have to play along out of fear of the madmen?
I never argue that the state is imaginary, I just point out that it is. It's a fact that the state is imaginary, not a position or opinion. Same with countries. I have an opinion that they aren't real, others think differently. When we go to the facts i.e. existence of borders, boundaries what have you in the real world, we find that I was right.
In the real world, there are no countries. Also in the real world are some idiots who think that they are and will use violence if you don't agree with them. It doen't make them right, anymore than it makes a physicist wrong if fundies torture him for a retraction that the world is round and circles the sun.
Of course people try to sell things to cover the costs of production. Whether they do or not is down to the value of the item they produce, nothing else.
How you feeling, anyway? Better I hope.
"You however seem to think that value is created from thin air."
Yeah, sure it is. It's only an issue when you are trading, for those few brief moments when the exchange is made. The subjective valuation of the parties involved, with their negotiating abilities etc all go to make up the value of an item at that time.
Afterwards it's the cat in the box again. It might be worth something, it might not, but you won't know until you look, so to speak. Value doesn't wander around with an item like some magical aura, or mystic sigil. Value is a function of the process of trade. When you aren't trading, theres no value.
It's a subjective value to the user at that point, totally immeasurable and impossible to define or make use of.
However, let's suppose you are right - it is consumers that fix exchange value. And the market is clever enough to ensure that consumers never decide that the exchange value is to be less than the production costs. This still means that the production costs have to be a factor - and if it isn't economic to make something, if there is a demand, then the production costs will be squeezed until it is economic. The easiest way to do this is to make your workers do more work for the same money or paying them less money, i.e. labour value. Thus, whichever way you look at it, labour costs are a factor - you're just approaching it backwards. Labour is also a commodity to be bought and sold in capitalism.
Or it won't get made at all. Even using this as being true, eventually production costs will be squeezed to the bone, and if the market still won't pay for the good in question, it's going to stop being made. Production costs relative to value decide what gets made over time, not the value or price of items.
"The easiest way to do this is to make your workers do more work for the same money or paying them less money, i.e. labour value."
Easiest way is to replace them entirely using technology. Freeing up those workers to make more products, businesses and services. This is the biggest argument for capitalism, that it increases the amount of goods and services produced.
Problem is, the amount of creative people coming up with new things to do is far outstripped by people who couldn't come up with something new if you put a gun to their head. This problem is compounded by the fact that those few creative people only have to get it right once and they get so many resources from their creation they don't have to bother anymore.
"Thus, whichever way you look at it, labour costs are a factor - you're just approaching it backwards."
I agree labour costs are a factor, but not in determining price or value. They are the determining factor in what can be produced succesfully over time. Because you have an attachment to the idea that the workers are being under paid, your whole rationale is to prove that this is the case.
"Labour is also a commodity to be bought and sold in capitalism."
So is money itself. There is no objective value for cash, it's still subject to the same trading process as everything else. As we will see when the current UK/US governments revisit the weimar republic any day now.
Exactly, that's my point. If something doesn't get made, it can't have an exchange value. However, the way you put it is backwards - you think that consumers can somehow foresee what will and won't be economical - you're even denying a little thing called supply and demand! If something is demanded, someone will find an economical way to produce it - and to be economical, production costs are a factor. You even admit it yourself!
Who makes that technology? More labour.
Or...more likely...they end up on the dole queue.
This does not follow.
Yes, this is my point too - they determine what can be produced and therefore what can have a value. You see, you've completely ignored the fact that things have to be made to be sold.
No, its rather the other way round. You're so keen to prove that profit is justified that you'd rather use a circular argument to prove your case than to approach it from another angle.
Exactly - the real measure is labour.
But it can get made without having an exchange value. You see, until you exchange it it doesn't have a value at all. Once you have traded it, it ceases to have a value. Value being a function of trade. And you have to pay for labour first.
Theres no reason that this is the case. It's got to be demanded by enough people at the right price relative to labour costs to continue to be made over time. If we make a new product and it costs a hundred quid to make, we have spent the hundred quid to make it. Cost comes first, you see. Then we have a product to take to the marketplace, which may or may not get more than that hundred quid, because of it's value in the market.
If we get more than our hundred quid, we can go make more. If we get less than the hundred quid, we have to stop. The value of items that are routinely made in an economy will appear to be related to production cost, because only those items that can pay their labour costs on a consistent basis will remain in the market. It's still not the determining factor of the value of the item though.
Yes, once. Once you have a series of sparkly new fangled machines they just have to be maintained (again through labour). If we make a machine that does the work of a hundred men, that takes 3 men to operate and maintain, those other 97 men can go do something else productive.
I agree. For the reasons I stated. The big flaw in capitalism is that the number of people who can come up with new goods and services is small, needing a special kind of mindset and drive and the number of new products that can be meaningfully made must reach a saturation point somewhere. Capitalism has no system for dealing with this eventuality, it just keeps on trucking.
As we see at the present time, we have enough food for all, the technology to sort out a hell of a lot of our problems, probably the political will if anyone ever really asked the people what they wanted to do, but because the old system itself is now obsolete but benefitting some powerful people who don't want to let go of it, there's friction all over it.
Itr does, up to a point. Then it fails. (See above)
And you completely ignore the fact that labour costs have to be paid for in advance of having a product, the value of which is not known until you come to sell it.
I don't think profit is justified, neither is inflation, fiat currency or any of the things of modern banking. I think it's possible to create a system where profit is justified i.e. by having 100% worker/share ownership with no one who doesn't work at that place able to buy shares in it, and the shares being given out evenly.
No, the real measure is what people want and will pay.
Any comments on fiat currency?
No, I am saying that no one knows, nothing knows, it's unknowable. For products that have already been successfully made, the guess is that you can go make more and sell them. You still have to pay labour costs first, and you still don't really know if your product will sell. The value of the item produced could be lower than your costs, and your business will fail, and this won't effect the value of the item in the slightest.
I am also saying that there is no relationship between the value of an item and how much labour goes into it. (Still) I've proved it half a dozen times now.
Yes, if it doesn't sell, it doesn't have an exchange value and is therefore not part of what we're talking about. This is what you seem to be ignoring, then agreeing with then ignoring again. If the item produced costs more to produce than the exchange value, this will be because exchange values are averages. What you would then do is to reduce your production costs. As I said - you're approaching it backwards and investing the market with mythical qualities it doesn't have.
Except you haven't. All you've done is state that exchange value is determined by exchange value. Which is clearly impossible.
No mate, what about if it sells for less than what you want for it? This does happen you know. Your thinking it's an either/or situation, it patently isn't. You might need a hundred quid to make something but only get ninety in the market. You've made a loss, and will fold, making no more stuff. The labour is still a hundred quid and has been paid for. The stuff is still worth ninety.
What with? You just went pop!
Impossible, why? Things only have a price at the moment of trade. It's a function, part of the process of trade. Again I come up against the verb/noun problem. Value is a verb, not a noun. It's something that's done with two or more people.
Yes, because exchange value is an average. You're doing it again - taking isolated examples rather than looking at the system.
In the real world of course, you'd borrow from a bank because it is recognised that most businesses run at a loss for the first couple of years.
You're arguing in circles. You're saying that exchange value is determined by exchange value just because it is determined by exchange value. It explains nothing.
No, it works for the system as a whole too. Think about it.
I thought the banks didn't decide what gets made in our economy? Of course, once you've borrowed from a bank you have to make a good fat profit to pay the interest rates, don't you? Your taking isolated examples again.
Look, this is why capitalism is the way it is. Have a kiddies story -
http://www.relfe.com/plus_5_.html
[/QUOTE]You're arguing in circles. You're saying that exchange value is determined by exchange value just because it is determined by exchange value. It explains nothing.
I have. It doesn't.
No, they don't. What is your point?
Yes, you do, so you squeeze your production costs down even further.
Aaaah, patronsing shite from a free marketeer! What a surprise.
Your system can't explain why this value is arrived at, not another one. It is self-referential.
Ok, please explain to me how the system as a whole can have a cost, make a loss or a profit.
If you have to borrow from a bank the cash to start a business they are the ones who decides what gets made or doesn't, yes?
Assuming you can, of course. You really should have read the link.
Yes. Theres also some very accurate information about how modern banking works in there. Read it. I agree it's a shame it's buried beneath free market guff, still worth understanding fiat currency.
That's because there is no reason. It's a product of available resources to the buying group, negotiating skill on both sides and the availability of a secondary good or fiat currency to trade in. Price is a result of the process of trade, nothing else. Otherwise, why are labour intensive thigs worthless, why are vital things like water cheap? Oh and why does value change over time?
this is a complete non-sequiter
Errrr...no.
Its a load of free market guff.
So there is no reason why prices average out to a particular value? Errr...ok.
Doesn't matter how many times you assert it, it still won't make it true.
More non-sequiters. Why is the price of water going up? Nothing to do with having to put more money into infrastructure according to you.
Changes in supply and demand, new technologies, changes in labour market. Many reasons.