Thursday, December 22, 2011

Vox Day Takes His Confusion to the Misesian Level

Vox Day has responded to my earlier criticism of his view, .

As per my policy with these guys, I won't respond to all their confusions, misinterpretations, etc., but I will bring in the whoppers. Vox Day's entire post is littered with confusions, but I will stick to fixing the real stinky litter.

Vox Day has brought the views of Ludwig von Mises into the picture by quoting him out of context, spinning Mises views in ways that Mises would never take them and giving the outrageous impression that Mises would be a greenbacker.

Vox Day writes:
And what is a "dollar"? A dollar is presently a credit instrument, specifically, a credit instrument known as a Federal Reserve Note. This is what Mises defines as "credit money", and not, as is commonly assumed, "fiat money", nor is it "commodity money", as was the case with the historical dollar, which was defined in 1792 as 24.056 grams of silver.
Vox Day states this without reference because he would never be able to find such a reference in the writing of Mises.

It simply boggles my mind that these guys think that a dollar is some kind of credit instrument. It's not. But further, it would make no difference if it was a credit instrument.

Later in his post, Vox Day quotes Mises and reveals his own confusion. He writes:
While I'm tempted to cut Wenzel some slack due to his support of Ron Paul, that is unfortunately not my idiom. So, to end my response with all the tender mercy of Van Helsing driving home a stake, I shall conclude by quoting Ludwig von Mises:

In a developed monetary system, on the other hand, we find commodity money, of which large quantities remain constantly in circulation and are never consumed or used in industry; credit money, whose foundation, the claim to payment, is never made use of;* and possibly even fiat money, which has no use at all except as money.
- The Theory of Money and Credit, p. 103 (1953)
What this has to do with the debate, I'm not sure. To me it sounds terribly misleading, as though Mises is making the claim that a Federal Reserve note is a credit instrument that is currently circulating. In fact, what Mises was doing at that point in his discussion was stating that many things have been used as money. In the sentence above the quote that Vox Day selected, Mises refers to the time when "An ox or a sack of corn" were used as money.

In other words, Mises discussion has nothing to do with Federal Reserve notes. It's slick copy and pasting by a confused Vox Day.

What is relevant to my debate with Vox Day and comes from the same book Vox Day quotes, The Theory of Money and Credit, is when Mises writes:
To regard note-holders or owners of current accounts as granters of credit is to fail to recognize the meaning of a credit transaction. To treat both notes and bills of exchange in general (that is, not merely sight bills) as "credit instruments" alike is to renounce all hope of getting to the heart of the matter.
There it is, Mises speaking from the grave directly to Vox Day about his crazed thinking that notes should be treated as "credit instruments." As Mises says, the Vox Day view renounces "all hope of getting to the heart of the matter."


  1. With respect who gives a RA (Rats Ass) about what Vox Day has to say? If it was Zerohedge maybe, but they would not be dissing LVM.

  2. Please don't accept the newspeak. Since 1971 the "notes" we're repudiated and became UN-notes. Misses was writing about actual notes in 1933. The greenbackers promote the circulation of unnotes not notes.

  3. I'm really enjoying this back and forth debate.

    Perhaps you two should have a taped discussion and you can post the podcast.

    I've learned a lot about economics from both you and Vox among others and I look forward to learning much much more, but it's very interesting when there is conflict.

    It seems unlikely that either of you will admit to being wrong but obviously one of you must be and both of you are making very persuasive arguments.

  4. I don't know who this Vox Day person is, but I know that Still makes the same mistake when he tries to make the claim that Tally Sticks are a fiat money.

  5. @wolfgang bohringer

    what is an UN-note?

  6. "It simply boggles my mind that these guys think that a dollar is some kind of credit instrument."

    Being as interest is paid on that dollar ... ahhh...

  7. A note is a contractual promise to pay something to someone. For example, when the federal reserve issued actual notes, the pieces of paper were printed with words something like "pay the bearer x dollars of gold or lawful money"

    Then when the promises on these pieces of paper were repudiated, the words "pay the bearer..." were removed, but the word "note" was not removed. Hence, the pieces of paper ceased to be notes and became non-notes or UN-notes.

    You probably understood this and maybe thought I was invoking the united nations or something.

    But it's always irritated me to hear greenbackers talk about their Uniited States NOTES that they want to print up. And just about everybody else uses the word note as wel. As Irwin Schiff often said, "If the pieces of paper said they were dinosaurs would that make them dinosaurs?"

  8. Vox Day? That guy who thinks 'gaming' women (read: being a pick-up artist) is going to - his words here, from the masthead of his other blog - Save Western Civilization? Who thinks he can defend tariff walls on Austrian grounds? Some people are simply beyond help. That textbook example of Rothbard's 'modal libertarian' is one of them.