The exhaust from your Chevy also doesn't have the "intrinsic worth" of the oil that it ultimately came from, either. Nor does the electricity from my solar cells have the "intrinsic worth" of the silicon they were made of.
So what? That is about the farthest thing from a valid analogy I've seen in a long time.
> The exhaust from your Chevy also doesn't have the "intrinsic worth" of the oil that it ultimately came from, either.
The difference between it and Bitcoin here is that no one is claiming that automotive exhaust has intrinsic worth due to the resources expended to produce it.
The VALUE is not indirect (i.e., extrinsic). The METHOD OF MEASUREMENT is indirect. Those are two different things. One does not imply the other.
If I measure the "worth" of your automobile in units of "old Chrysler convertibles", that doesn't mean your automobile has any more or less economic value than if I measure it in helium balloons. The method of measurement (if it's done properly) does not affect the actual value.
In the case of Bitcoin, it CAN be traded directly for goods, not dollars. There is nothing REAL distinguishing it from any other commodity, such as rice. The value is roughly equivalent to the cost of production + distribution.
I take that back. There IS one difference, but (at this time) it is minor: that is the ultimately limited supply, but that isn't even remotely close enough yet to affect a RATIONAL market.
An EXTRINSIC value, on the other hand, and to use Wikipedia's example, is like the "value" of a song played on a guitar. It has its own subjective and economic values, but that is completely separate from the cost of manufacturing the guitar. This is NOT even remotely the same situation as Bitcoin.
dragonwriter|12 years ago
The difference between it and Bitcoin here is that no one is claiming that automotive exhaust has intrinsic worth due to the resources expended to produce it.
AnneOminous|12 years ago
The VALUE is not indirect (i.e., extrinsic). The METHOD OF MEASUREMENT is indirect. Those are two different things. One does not imply the other.
If I measure the "worth" of your automobile in units of "old Chrysler convertibles", that doesn't mean your automobile has any more or less economic value than if I measure it in helium balloons. The method of measurement (if it's done properly) does not affect the actual value.
In the case of Bitcoin, it CAN be traded directly for goods, not dollars. There is nothing REAL distinguishing it from any other commodity, such as rice. The value is roughly equivalent to the cost of production + distribution.
I take that back. There IS one difference, but (at this time) it is minor: that is the ultimately limited supply, but that isn't even remotely close enough yet to affect a RATIONAL market.
An EXTRINSIC value, on the other hand, and to use Wikipedia's example, is like the "value" of a song played on a guitar. It has its own subjective and economic values, but that is completely separate from the cost of manufacturing the guitar. This is NOT even remotely the same situation as Bitcoin.