Parman - Activate OP_GFY now!! on Nostr: Help in DMs, How does scarcity in money lead to abundance? This is something that ...

Help in DMs, How does scarcity in money lead to abundance?

This is something that [email protected]
says, and i was asked how to explain it...

Abundance comes from humans specialising to produce what they are best at, rather than trying to do everything themselves.

In a world where the is no money, you have to barter. In that world, it's very risky specialising in producing only what you're good at because it hurts your ability to trade (barter).

You get what you want through trade, so that improves your life, but there isn't abundance of things because production capacity is low, as people aren't efficient at making things - they're wasting time.

When society evolves to have money, we get more production (and abundance).

This makes everyone have more, and it's the same as "things are cheaper".

Money measures the products available.

All the money buys all the things.

Fixed money supply --> more things. Then prices become lower for each thing.

If everything available doubles, and money supply doubles, the abundance doesn't lead to things being cheaper. Prices stay the same.

So even though there is more stuff, you don't get to benefit, as someone else printed money and stole those cheap goods - now prices go back to what they were.

It's like a company has overproduced something and sells them at a discount. Then before everyone's awake at 5:00 a.m, some people with extra money (counterfeited) come and buy a lot, deplete the supply, and then price goes back up, so the general public doesn't benefit from the extra production.