Alternative Economies

[SkydiveJonathan 0]

The U.S. Department of Commerce estimates that 20 to 25% of world trade is now barter, and corporate barter is now a 20 billion dollar industry. Barter continues to carve out an important place in the U.S. and world economy.

[weekender 0]

I'll ask again. what is your point for these post? do you think the world could operate on a barter system?

you keep cuttin and pasting interesting observations but your starting to sound like dustin hoffman in Rainman. Do you have a an original thought or point? Please respond without quoting someone else and answer my queston.

(billvon, this time i am asking actual questions. yes, i see the irony in my post to you.)

"The point is, I'm weird, but I never felt weird."
John Frusciante

[SkydiveJonathan 0]

Quote

I'll ask again. what is your point for these post? do you think the world could operate on a barter system?

you keep cuttin and pasting interesting observations but your starting to sound like dustin hoffman in Rainman. Do you have a an original thought or point? Please respond without quoting someone else and answer my queston.

(billvon, this time i am asking actual questions. yes, i see the irony in my post to you.)

Yes, now that we have computers, the world could operate on a barter system.

[weekender 0]

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The U.S. Department of Commerce estimates that 20 to 25% of world trade is now barter, and corporate barter is now a 20 billion dollar industry. Barter continues to carve out an important place in the U.S. and world economy.

Thats peanuts. GM had 151.5 bill in rev's last year alone. Best Buy, 50 bill and they are going out of business. Thats two of 6 thousand or so public companies. you dont have a good understanding of how big the world is.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[billvon 2,991]

>I asked the OP what his point was and if it is to replace our current system with a
>barter system. I think that is a childish thought and anyone who understands the
>basics of the modern world could see that.

>I dont think his alternative economy makes sense to adults. i brought up the alternator
>repair to new car purchase to show that when the silly theory is expanded into the real
>world it doesnt work. You could not run one motor company on a barter system let
>alone several.

I just don't see a big difference between dollars, hours, euros, gold coins etc. All are just names we give to units of currency used to represent goods and services. My claim is that it doesn't matter what you call it. It's already basically a barter system.

The one big difference is that it is no longer a fiat system. A fiat system is one where a government or central bank sets the value of money, and adjusts it via its fiscal policy. Barter systems are based on units of currency that are NOT fixed by the government, and laws that are based on fiat money are more difficult to enforce with non-fiat money.

Let's take an example. Let's say you want your alternator fixed, but you do not have enough dollars to pay for it, or enough hours to work to barter for it. But you do have some gold coins. Might the car repair guy accept gold coins for his work? Perhaps. Not because it is fiat money, but because gold has value that he can exchange for other goods or services.

[SkydiveJonathan 0]

A virtual economy (or sometimes synthetic economy) is an emergent economy existing in a virtual persistent world, usually exchanging virtual goods in the context of an Internet game. People enter these virtual economies for recreation and entertainment rather than necessity, which means that virtual economies lack the aspects of a real economy that are not considered to be "fun" (for instance, players in a virtual economy often do not need to buy food in order to survive, and usually do not have any biological needs at all). However, some people do interact with virtual economies for "real" economic benefit.

[weekender 0]

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I'll ask again. what is your point for these post? do you think the world could operate on a barter system?

you keep cuttin and pasting interesting observations but your starting to sound like dustin hoffman in Rainman. Do you have a an original thought or point? Please respond without quoting someone else and answer my queston.

(billvon, this time i am asking actual questions. yes, i see the irony in my post to you.)

Yes, now that we have computers, the world could operate on a barter system.

I dont understand how something as complicated as our world economy could operate on such a primative system as bartering. Of course thats because i have at least a basic understanding of it. you dont seem to be burdened by that problem.

id like to point out to the audience that this is the same guy who claimed Goldman Sachs was hoarding grain in Chicago. This was evidenced by a Rolling Stone article about commodities clearing and escrow services they provide. an article he could not wrap his brain around. Same guy.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[SkydiveJonathan 0]

The release of Blizzard Entertainment's World of Warcraft in 2004 and its subsequent huge success across the globe has forced both MMORPG and their secondary markets into mainstream consciousness, and many new market places have opened up during this time. A search for WoW Gold on Google will show a multitude of sites (more than 90 sponsored results as of June 2006) from which Gold can be purchased. Real money commerce in a virtual market has grown to become a multi billion dollar industry. In 2001, EverQuest players Brock Pierce and Alan Debonneville founded Internet Gaming Entertainment Ltd (IGE), a company that offered not only the virtual commodities in exchange for real money but also provided professional customer service. IGE had a trained staff that would handle financial issues, customer inquiries and technical support to ensure that gamers are satisfied with each real money purchase. It also took advantage of the global reach of synthetic worlds by setting up a shop in Hong Kong where a small army of technically savvy but low wage workers could field orders, load up avatars, retrieve store goods and deliver them wherever necessary. This lucrative market has opened a whole new type of economy where the border between the real and the virtual is obscure.

[weekender 0]

You are NOT describing the same thing as the original poster. your point is valid but not applicable to my questions to him. he is describing a simple barter system as evidenced by his Spanish example. that would not work expanded to a larger economy. your are trying to convince of something i already understand and accept.

Currency and all securities trade on perceived value not issued value. Thats is how the entire economic world works. for the record i know that. i understand how things are exchanged for their non tangible values. i have been a securities trader for 20 years. you dont need to explain that to me going forward, fyi.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[SkydiveJonathan 0]

Taxation

Income from sale of virtual items is being considered as real revenue as players in such games have ascribed a real-world value onto them: "By taking any aspect of the game and connecting it directly to the real world, the games have only brought this possibility on themselves." And as that ascribed value is being increasingly converted into real money, attention is now being given by those in taxation law and in governments.

Commentators in taxation law speculate "that profits made in virtual worlds could be taxable even before they are withdrawn as dollars." The speculation seems to be based on the observation that, as one commentator said, "the easier it is to buy real goods with virtual currency (e.g. order a real life pizza) the more likely the IRS will see exclusively in-world profits as taxable."

[weekender 0]

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The release of Blizzard Entertainment's World of Warcraft in 2004 and its subsequent huge success across the globe has forced both MMORPG and their secondary markets into mainstream consciousness, and many new market places have opened up during this time. A search for WoW Gold on Google will show a multitude of sites (more than 90 sponsored results as of June 2006) from which Gold can be purchased. Real money commerce in a virtual market has grown to become a multi billion dollar industry. In 2001, EverQuest players Brock Pierce and Alan Debonneville founded Internet Gaming Entertainment Ltd (IGE), a company that offered not only the virtual commodities in exchange for real money but also provided professional customer service. IGE had a trained staff that would handle financial issues, customer inquiries and technical support to ensure that gamers are satisfied with each real money purchase. It also took advantage of the global reach of synthetic worlds by setting up a shop in Hong Kong where a small army of technically savvy but low wage workers could field orders, load up avatars, retrieve store goods and deliver them wherever necessary. This lucrative market has opened a whole new type of economy where the border between the real and the virtual is obscure.

what is your point? do you even understand the article your reading? it should be of no surprise nerds would pay money to give them an advantage at their video games. its no different than a golfer paying up for a new driver to give him an advantage in his golf game. it is not new and is certainly not a new type of economy. you are sounding more and more like Rainman with each post.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[billvon 2,991]

>You are NOT describing the same thing as the original poster. your point is valid but
>not applicable to my questions to him. he is describing a simple barter system as
>evidenced by his Spanish example. that would not work expanded to a larger
>economy. your are trying to convince of something i already understand and accept.

>Currency and all securities trade on perceived value not issued value. Thats is how the
>entire economic world works. for the record i know that. i understand how things are
>exchanged for their non tangible values. i have been a securities trader for 20 years.
>you dont need to explain that to me going forward, fyi.

My point is that they are not all that far apart. From an article on Spanish time banks:

"While each social-money project has its own accounting rules, the basic concept is the same. You earn credits by providing services or selling goods, and you can redeem the credits with people or businesses in the network."

To me, there is no difference between that and non-fiat money. (Other than in scale; most are still fairly small.)

[SkydiveJonathan 0]

For a persistent world to maintain a stable economy, a balance must be struck between currency sources and sinks. Generally, games possess numerous sources of new currency for players to earn. However, some possess no effective "sinks", or methods of removing currency from circulation. If other factors remain constant, greater currency supply weakens the buying power of a given amount; a process known as inflation. In practice, this results in constantly rising prices for traded commodities. With the proper balance of growth in player base, currency sources, and sinks, a virtual economy could remain stable indefinitely.

As in the real world, actions by players can destabilize the economy. Gold farming creates currency within the game more rapidly than usual, exacerbating inflation. In extreme cases, a cracker may be able to exploit the system and create a large amount of money. This could result in hyperinflation.

In real world entire institutions are devoted to maintaining desired level of inflation. This difficult task is a serious issue for serious MMORPG's, that often have to cope with mudflation.

[weekender 0]

Quote

>You are NOT describing the same thing as the original poster. your point is valid but
>not applicable to my questions to him. he is describing a simple barter system as
>evidenced by his Spanish example. that would not work expanded to a larger
>economy. your are trying to convince of something i already understand and accept.

>Currency and all securities trade on perceived value not issued value. Thats is how the
>entire economic world works. for the record i know that. i understand how things are
>exchanged for their non tangible values. i have been a securities trader for 20 years.
>you dont need to explain that to me going forward, fyi.

My point is that they are not all that far apart. From an article on Spanish time banks:

"While each social-money project has its own accounting rules, the basic concept is the same. You earn credits by providing services or selling goods, and you can redeem the credits with people or businesses in the network."

To me, there is no difference between that and non-fiat money. (Other than in scale; most are still fairly small.)

yes and the scale part is my entire point. only a child would think the world economy could run on the same system he uses to get an cupcake. (i used exchange someones turn to clap the erasers for their cupcakes. my mom NEVER made or bought cupcakes.)

for the record, im calling his thinking childish, not yours. i was not even trying to have a discussion with you. hah

"The point is, I'm weird, but I never felt weird."
John Frusciante

[billvon 2,991]

>it should be of no surprise nerds would pay money to give them an advantage at their
>video games. its no different than a golfer paying up for a new driver to give him an
>advantage in his golf game. it is not new and is certainly not a new type of economy.

The difference here is that there are people with full time jobs who do nothing but play the game to acquire wealth; they then trade this for real money and live on the proceeds. (called "gold farming.") The basis of any currency is valuation of goods and services, and both goods (virtual items) and services (labor) can be traded within such persistent games as WoW. While it's a tiny part of the overall economy, it has attracted a lot of interest from economists, who now have a chance to study fiscal policy implemented on a small-scale (but quite real) economy.

[billvon 2,991]

>yes and the scale part is my entire point. only a child would think the
>world economy could run on the same system he uses to get an cupcake.

Ah. If scale is what you claim the difference is, then I agree; barter systems are much smaller.

[weekender 0]

Quote

>it should be of no surprise nerds would pay money to give them an advantage at their
>video games. its no different than a golfer paying up for a new driver to give him an
>advantage in his golf game. it is not new and is certainly not a new type of economy.

The difference here is that there are people with full time jobs who do nothing but play the game to acquire wealth; they then trade this for real money and live on the proceeds. (called "gold farming.") The basis of any currency is valuation of goods and services, and both goods (virtual items) and services (labor) can be traded within such persistent games as WoW. While it's a tiny part of the overall economy, it has attracted a lot of interest from economists, who now have a chance to study fiscal policy implemented on a small-scale (but quite real) economy.

ok thats pretty interesting. not the gaming for money part. thats nothing new but that fact that its being studied by economist. why do i get the impression that Rainman doesnt even understand what he is posting? i think he might seriously be a robot or a high functioning retarded person.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[Lefty 0]

Just to save everyone some time, this is where DD is copying his posts from.

Provoking a reaction isn't the same thing as saying something meaningful.
-Calvin

[Fearjoburg 0]

The only industry where I see barter working effectively and at a global scale is in the media where advertising is involved across various publications and or platforms.

Other than that I don't think its viable.

Also playing games and selling eg "virtual gold" is not bartering.

Another problem with bartering taxation is how does the tax authorities tie a value to the barter deal eg which one is worth more? In the end the tax consequences will net out if the transaction was at arms length. eg If I fix your delivery car and you do my restaurant's plumbing all for the purposes of the production of taxable revenue?

Money is there because it is more practical to use than trading

[billvon 2,991]

>Another problem with bartering taxation is how does the tax authorities tie a value to
>the barter deal eg which one is worth more?

Neither one; both are assessed at their fair market value for purposes of taxation. After a big wave of barter in the 1980's in the US, the IRS got good at such assessments.