Crime Against Humanity: Forms of Seigniorage, 8
Ok, enough with the fun; now let’s get serious. Since legalese is usually concocted to allow the sly to screw the honest, let’s set legalese aside and get to the core in plain English. The question, “What is the core of seigniorage?” can be reformulated as, “What is the functional, useful common denominator of its various definitions and forms?” and the answer is, “The common denominator, the core of seigniorage is the profit resulting from the faculty of creating purchasing power out of nothing; that is, that very purchasing power resulting from the faculty of creating it out of nothing.” If we want an effective keyword on our flags, the best foundation is a true, comprehensive, clear, practical and shared definition of it. In other words, so, in terms of definition, we can call seigniorage the faculty, the action, the result: the faculty of creating purchasing power out of nothing, the act of creating purchasing power out of nothing, the purchasing power created out of nothing. All facets of the same crime against humanity.
Once the core is clear to us, we’re immune to the smokescreens and tendentious propaganda and we can see for ourselves. And it makes sense to subdivide the scene for further clarification, and previous subdivisions may look clearer than before, too. In accordance with our practical purposes, I’ll consider a subdivision into the following simple and broad types.
Primary, or monetary, seigniorage is the one based on physical money.
Secondary, or scriptural, seigniorage is the one based on any form of intangible money, of quasi−money actually exploited as money despite the fact that it does not exist.
Tertiary, or financial, seigniorage is the one based on negotiable instruments, on not−money actually exploited as money despite the fact that it is not money. I would offer to you my own draft of a definition, which is: purchasing power created out of nothing in any form, physical or dematerialised, that does not even mind to pretend to be money by carrying its name any more.
It could be said that the difference between secondary and tertiary is that, while in both cases IOUs are exchanged as if they were money, a secondary IOU pretends to be money irself, while a tertiary IOU does not, and promises secondary IOUs, instead: just an additional step, though.
Quaternary, or international, seigniorage is the one based on differences in supply and demand of the same money in different circumstances, on inducing in someone somewhere an artificially inflated want for that money.
Let’s say straight away that, should there ever be any ambiguity within these subdivisions or should the borders between them be ever evanescent, this is caused by the ambiguity in the definition of money itself, actually in the definition of legal tender: what the government demands and enforces as debt settlement. As I said, this comes as no surprise at all; it is intentional and it is as ambiguous and evanescent as the official answers to the question, “What is money and what is not money, then?” Its meaning, its purpose is as usual the profiteering of purchasing power out of nothing, in this case resulting from the faculty of passing as money what is not money. This faculty too is creation of purchasing power out of nothing and therefore seigniorage, falls within these subdivisions, and these subdivisions serve to highlight that, too.
As all the psalms end in glory, etymologically the word “seigniorage” means “profit of the seignior that issues money”, which rhymes with the “property of money upon issuance” discussed before. To the degree the costs borne by the issuer for the intrinsic value of money approach zero, to that degree it’s a rhyming couplet.
