The Lifecycle of the Substitute and Its Purchasing Power

But now let’s review some key aspects of media of payment before we look into what is based upon them. To see all ramifications through, we have to know and understand the roots, fully and thoroughly.

So a medium of payment traded in for something else, when it does not have intrinsic value, such as fiat money, is – or ought to be – an agreed, accepted substitute for the actual product. As such, it is a negotiable instrument, that is, it represents a debt/credit.

The basic key aspect is that debt/credit can be created out of nothing, while products cannot. To bring a debt/credit into existence all it takes is agreement; to bring a product into existence it takes resources and production. Let’s then break this aspect up which is the basis for every debt money, infinite debt trap, suppressive philosopher’s stone.

We can observe how everything subject to physical laws is subject to a lifecycle as well: it begins, it continues, it ends – maybe, when it comes to money –. And we can observe as well how, when it comes to money, each of these three stages of its lifecycle is worth being inspected thoroughly:

Beginning: who is the owner of the purchasing power of the substitute the moment it is born?

Continuation: does the purchasing power of the substitute exist instead, in addition, or in the absence of the purchasing power of the product?

End: does the purchasing power of the substitute cease to exist at all, and if so, when, how, and at the expense of whom?