First, this fellow is self-employed. He was caused much pain given nonsensical gold trade statistics, so he found joy in just validating (or more often invalidating) gold trade data and its sources. So now he makes money with his work, and is a big draw at conferences.
What came to light as on odd discrepancy between GFMS’ Chinese gold demand and “apparent supply” has proven to be a tenacious cover-up by the oldest consultancy firm in the gold market. And not only does GFMS publish incomplete and misleading data on Chinese gold demand, all its supply and demand data is incomplete and misleading. As a result, the vast majority of investors across the globe has been brainwashed to believe total gold supply and demand mainly consists of global mine output and jewelry demand. In reality, the supply and demand data GFMS publishes is just the tip of the iceberg. But the firm is reluctant to admit this publicly, lest their business model would be severely damaged.Next, as I have said repeatedly here, it is definitions of money that are so misleading, as to malinform thought. Frank Shostak is brilliant, and his essay good, but I disagree with him here as well. This new definition surprises me, but it is in the context of his certain argument here, and he may merely be making a point.
No definition, however, can be established by means of a correlation. The purpose of a definition is to present the essence, the distinguishing characteristic of the subject we are trying to identify. A definition is to tell us what the fundamentals of a particular entity are.In any event, he debunks most other definitions of money in this post.
In this sense money is that for which all other goods and services are traded. The distinguishing characteristic of money is that it is the general medium of exchange. It has evolved from the most marketable commodity.
I've defined money here classically (search the blog for "money"), to have a solid basis for thinking and analyzing. It is no guarantee that my thinking is sound, but to start with mal-definitions is to guarantee others is unsound. Take the trouble to define terms correctly, to have a better chance.
J. K. Galbraith: ‘The study of money, above all other fields in economics, is the one in which complexity is used to disguise truth or to evade truth, not to reveal it.’ Money, p. 5
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