Why is Money Energy?

[ZomgK3tchup]

Yes, societies use energy. Yes, we generate energy in tandem with our consumption of it. I do not disagree with any of this. Admittedly, an energy standard would require much energy to be stored and not used if it's to be equivalent to the gold standard, and that raises problems--why should energy in a battery somewhere be considered more valuable than energy somewhere else, and what's to stop someone from creating their own? But no, I don't disagree that energy consumption rises with production. I don't see how that relates to what I've been saying, however.

This can be explained with some good old fashion technobabble about how your battery is some universal standard of all batteries that is both highly efficient and highly difficult to produce. It's a stretch, but it's better than explanations given in a lot of other science fictions.

I don't particularly agree with the explanation, but I assume it was "Let's make an energy-based currency!" instead of "What kind of universal currency could we have?"

 

[eon47]

This can be explained with some good old fashion technobabble about how your battery is some universal standard of all batteries that is both highly efficient and highly difficult to produce. It's a stretch, but it's better than explanations given in a lot of other science fictions.

I don't particularly agree with the explanation, but I assume it was "Let's make an energy-based currency!" instead of "What kind of universal currency could we have?"

Oh, I'm completely down for technobabble. I just disagree with people who think the technobabble is grounded in realism, and especially the gold standard. But I like Star Wars and Dr. Who and The Matrix--technobabble is life.

 

[SeeGee]

I actually just call it "gold" in my head. It's just how it computes in my brain. I think it has to do with all the RPGs...

 

[Kayden_II]

A Currency is the Money of a specific Country and Money is (these Days) a Commodity of a Monopolist, Which We are calling a Bank ...
A Bank creates Money as a Credit and the Credit-Borrower has to pay back his/her Credit in the Future with Interests, so that his/her Credit + his/her Interests are his/her Debts, Which are covered by his/her Properties ...

Parody:
The Bank has created the Credit, but not the Interests, so that the Credit-Borrower can't pay back his/her whole Debts in the Future, so that He/She loses his/her Properties in the Future ...

But in between, the Time between Now and this Future, He/She can uses his/her Credit as Money, too ...
1. to measure the Value of other Commodities ...
2. to exchange It with other Commodities ...
3. to stock It as Value ...
4. to pay back other, but lesser Credits ...

Basicially, That's How this Stuff works nowadays - It's a Cheat.

 

[Tsuihousha]

More economic activity means more to tax, which means you can buy energy with that money (or pay troops with it, whatever, energy and currency can be swapped for one another as needed).

The part that doesn't actually make sense is where this private, taxed economic activity comes if the government builds, owns, and directs Pops to operate all of the economic buildings. (Also, how am I expected to believe that a species that can travel the stars can only manage to make on its initial colonies a hydroponics farm so inefficient that it not only requires the farming efforts of everyone it feeds, it also requires additional upkeep from outside of the colony? One Pop eats one unit of food, and that's all a basic farm produces unless it's on an especially fertile tile.)

Lucky for you a very wanted function is being added; food is now global! The capital buildings now also produce energy from what I've seen on the dev streams. (Hopefully they produce Energy AND Minerals at higher levels so that you can double dip on E/M tiles just you could with F/M tiles before hand.)

Either way energy makes sense as a unit of currency; it's useful and everyone needs it so it seems like an obvious choice for the standard for game-play purposes.

 

[GC13]

Lucky for you a very wanted function is being added; food is now global! The capital buildings now also produce energy from what I've seen on the dev streams. (Hopefully they produce Energy AND Minerals at higher levels so that you can double dip on E/M tiles just you could with F/M tiles before hand.)

Either way energy makes sense as a unit of currency; it's useful and everyone needs it so it seems like an obvious choice for the standard for game-play purposes.

From what I've seen they only produce Unity and Energy, so there aren't any buildings that can double-dip.

It doesn't make it that much better though, since even farms on the capital are nowhere near as labor-efficient as modern farms unless you assume that almost all Pops are involved in private sector work that has no impact on gameplay at all.

 

[Ratanka]

Trade districts on ring world generate energy. Stock exchanges generate energy. Services from artisans and curators need to be bought with energy. Trade enclaves trade with energy.

I don't get why they didn't just call energy what it is, which is money. How would an energy based economy even work, would we all carry batteries around?

money has no value ... especially in intergalatical trade

 

[The Founder]

Yet at the same time, because energy would be so abundant, as a standard, it would, like aluminum, grossly depreciate in value. I could probably buy a Coke for the energy equivalent of many tons of dynamite, or more, which itself is a problem--the bottle of Coke does not require that much energy to make, and yet because the standard is something so common, it is now worth less than itself. Gold gets around this issue by being much scarcer and not having literally (and in multiple senses) universal use and value, but this is not so for energy.

Coca Cola does not cost as much money to make as you pay for it right now. A lot of the price is simply for the Brand Coca Cola.
If the production has a hard limit independant of energy (even an artificial one), then the price in energy per bottle will skyrocket. Basic Economics.
Coca Cola could easily turn into Luxury Good. Or something worthy of a Lottery.

What makes most good valuable is that no mater how MUCH money you throw at it, the supply is still finite. Aluminium had no such issues, wich is why it became cheap with more power.

And since we are talking about value:
Usually coins materials are worth more then the value printed on them. And a 100 Dollar note stands for so much more value then the production costs, it is ludicrous.

I don't have the same interest in storage mediums that many people in this discussion do. It seems profoundly dangerous for the average person to to be able to store several Hiroshimas in their wallet, which would be required for currency to be transferable into energy and vice versa.

Hiroshima was a lot of energy, released in a very short time in a very small space. A equal amount of energy over a longer time and longer surface would maybe give you a sunburn.
The only difference between a Endothermic Reaction (Fire) and a Explision is how fast the reaction runs/releases energy.

The Hiroshima Bomb and Nuclear Power plants both use Fissable material.
The Hiroshima bomb released about 42 Peta-Joule (15 zeroes)
Nuclear Powerplants produce 2558 terawatthours per year. That is 9208,8 Peta-Joule.
We are literally producing 219 times as much enegry as the Hiroshima bomb per year. Just from nuclear power plants. And after conversion losses (all the way from heat to electricity). So we already have "several hundred hiroshimas" in private hands.

The estimaed total energy consmption on our planet was around 3.89 × 10^20 Joule for 2013. That is 389.000 Peta Joule. We are producing 9262 Hiroshima bombs worth of energy per year.
Let's asume that whatever storage medium is given to the averge person, is not easily turned into a planetbuster. Even if it contains 9262 Hiroshima Bombs worth of energy.

I'm really not sure about an energy backed currency. I mean, look at what happened to the ruble when the price of oil crashed. The ruble's basically a present day energy credit. Oil is pretty cheap and abundant, with huge fluctuations in supply and demand and huge fluctuations in price. It's not a good thing to have backing your currency at all.

The issue was this being a Fossil fuel, where supply can quickly change.
All energy production in Stellaris happens on renewable production levels. Just for simplicities sake a planet never runs out of Power Production Resources. Betharian Stone never runs out.

 

[genrtul]

The issue was this being a Fossil fuel, where supply can quickly change.
All energy production in Stellaris happens on renewable production levels. Just for simplicities sake a planet never runs out of Power Production Resources. Betharian Stone never runs out.

I don't see how a fossil fuel's supply could possibly be more volatile than with renewable energy. There's a limited amount of the stuff, so that gives it some baseline value. It's still bad to base a currency on oil, but not as bad as basing it on the output of solar panels or wind farms.

 

[Emraldis]

I don't see how a fossil fuel's supply could possibly be more volatile than with renewable energy. There's a limited amount of the stuff, so that gives it some baseline value. It's still bad to base a currency on oil, but not as bad as basing it on the output of solar panels or wind farms.

I would disagree, to some extent. Sure, basing a currency on a fluctuating power source is bad, but basing a currency on a resource that is dwindling and eventually runs out is worse, IMO. Also, if you have enough wind and solar spread out over a larger area, the fluctuations tend to average out. In the end though, nuclear (fission or fusion) is the most reliable.

 

[eon47]

Coca Cola does not cost as much money to make as you pay for it right now. A lot of the price is simply for the Brand Coca Cola. If the production has a hard limit independant of energy (even an artificial one), then the price in energy per bottle will skyrocket. Basic Economics. Coca Cola could easily turn into Luxury Good. Or something worthy of a Lottery.

Everything has a hard limit independent of energy--production capacity, raw materials, whatever--yet not all prices skyrocket, so I don't know what you mean by that, or how it's relevant. The concern isn't that it doesn't cost as much money to make as you pay for it right now; it's that the bottle of Coke does not require that much energy--not money--to make. You can chain money to energy, but energy still has value and utility outside of whatever numbers we might hypothetically slap on it. Because energy is now currency, however, and because energy is exceedingly abundant in the sort of society we're talking about, and in the universe in general, the absurd situation arises where energy does not reflect the value of energy. This isn't too big of an issue for gold, since while it is used in electronics and jewelry, its presence isn't anywhere near as pervasive as something like energy and its supply is limited both in quantity and the rate at which new gold can be added to the supply. However, none of this is true for a resource that is literally everywhere and that anyone can easily produce at any time, especially with future tech. (And again--what kinds of energy are even counted as currency, and how do you regulate production?)

What makes most goods valuable is that no mater how MUCH money you throw at it, the supply is still finite. Aluminium had no such issues, wich is why it became cheap with more power. And since we are talking about value: Usually coins materials are worth more then the value printed on them. And a 100 Dollar note stands for so much more value then the production costs, it is ludicrous.

Any amount of energy released over a slow enough amount of time is fairly unimpressive. The equivalent of a supernova could be released slowly enough to only give you a sunburn, at least in theory. This doesn't change the fact that the average person today does not have easy access to something containing 1/219 of our current nuclear power output, or 1/9262 of our current energy consumption, or whatever other numbers we want to use to frame the question. There has been talk of batteries and superconductors, which presumably would be easy to charge and use. We don't provide unregulated access to power sources containing even a fraction of the energy we're talking about today because it would be dangerous, so I don't see why that should change with even higher stakes. To assume these vast amounts of energy cannot be dangerous, either as a result of accidental or intentional action, is not something I am willing to do, and this is even before we get to "planetbuster" levels of power.

This is my last post, I think. I feel like I keep adding more and more points to my argument that aren't getting addressed, and in any case, why are we assuming that the future will be based around a notion (something equivalent to the gold standard) that is already antiquated in the present? But I did enjoy our discussion, and I'd gladly read any last response you may have.[/quote]

 

[Drowe]

Usually coins materials are worth more then the value printed on them.

This statement is simply untrue, the medium that is used as currency, almost always is worth less than the value of the currency it represents. There are some current and past examples where this is not true, for example the 1¢ coins in both Dollar and Euro. Whenever this happened in the past, the coin was eventually retired, because it is ludicrous to create coins that are more expensive to produce than the value they represent, it is a net loss and if the materials alone are worth more than the coin, people will melt them down for the raw materials.

 

[The Founder]

This statement is simply untrue, the medium that is used as currency, almost always is worth less than the value of the currency it represents. There are some current and past examples where this is not true, for example the 1¢ coins in both Dollar and Euro. Whenever this happened in the past, the coin was eventually retired, because it is ludicrous to create coins that are more expensive to produce than the value they represent, it is a net loss and if the materials alone are worth more than the coin, people will melt them down for the raw materials.

Melting them down is usually illegal for exactly that reason. Even if they are in your pocket, they are often still owned by the issuing government. Granted they will propably only bother with industrial scale examples.

Germany recently had an localised expierment to retire the 1 and 2 cent coins (just round prices to the nearest multiple of 5 cent). Near the Neatherland border, where they have done that for decades. It simply failed - there is no better way to describe it.

It would be entirely rational to do retire them. But we do not life in a rational world:

 

[Xoatl]

Energy is actually a very good unit for money/gold. It has never occurred to me to use energy as a standard for currency. I've heard about gold and rice but never electricity.

 

[Kat Tsun]

Energy is actually a very good unit for money/gold. It has never occurred to me to use energy as a standard for currency. I've heard about gold and rice but never electricity.

It's too early a meme. It only appeared in the 1930s, so it's nearly contemporary with "quantum" and "nuclear" (a decade might as well be five minutes in popular consciousness time).

https://en.wikipedia.org/wiki/Technocracy_movement

 

[The Founder]

This doesn't change the fact that the average person today does not have easy access to something containing 1/219 of our current nuclear power output, or 1/9262 of our current energy consumption, or whatever other numbers we want to use to frame the question.

Diesel Fuel. Energy desinity about 36*10^6 Joule per litre.
Sure, not a nuclear weapon equivalent. But if you could actually weaponise a 60 Litre tank of Diesel Fuel, it would still create a whopping 2.160 Megajoules of Power. That should dwarf any handgrenade or mine easily. Alas, you can not weaponise it that easily.


Yes, the prospect of nuclear weapons is kind of scary. But ignores that actually making them is damn near impossibly hard. If not, everyone and thier dog would have them.
When a Nuclear weapon does work, it is very impressive.
If it does not work it is a flea fart compared to that.

In nuclear reactors you only need the fuel in "critical" mass.
In nuclear weapons you need it in "supercritical" mass.
The longer the weapon is between the "normal" cirtical and desidered level of superctiricality, the more likely a random decay event will just start a reaction. And thus reduce the yield to pretty much negligible amounts with Fallout.
https://en.wikipedia.org/wiki/Nuclear_chain_reaction#Predetonation
https://en.wikipedia.org/wiki/Nuclear_weapon_design#Pure_fission_weapons

You need enough density and purity (of a specific Isotope) for the realy powerfull energy yields. But the moment you do have a reaction, the fuel will be driven appart by the very reaction. That is why nuclear powerplants have several times the Uranium you need for a Nuclear bomb. But are only a Fallout Danger.
Of the hundreds of Radioactive Isotopes*, only U-235 and Pu-239 are anywhere near common/produceable, stable and longlived enough to be used in nuclear weapons design. And you still need a considerable industrial, technological and skill needed to actually make the thing work even with those.

*Every entry on the Periodic table has a radioactive Isotope or multiple. Starting with Hydrogens 3rd Isotope, Tritium.

 

[Drowe]

Melting them down is usually illegal for exactly that reason. Even if they are in your pocket, they are often still owned by the issuing government. Granted they will propably only bother with industrial scale examples.

Germany recently had an localised expierment to retire the 1 and 2 cent coins (just round prices to the nearest multiple of 5 cent). Near the Neatherland border, where they have done that for decades. It simply failed - there is no better way to describe it.

It would be entirely rational to do retire them. But we do not life in a rational world:

Just because it failed in Germany, it doesn't mean it fails everywhere. Australia for example has done exactly that on a nation wide scale, and it succeeded. The US has retired the half-cent in 1857 for the same reason. And if you take a look at India, you can see what happens if the material coins are made of is worth much more than their face value. They have a coin shortage because people do that.

 

[TheDeadlyShoe]

Perhaps we should just think of the 'energy' part of energy credit to be purely for interstellar trade; the currency used within a civilization (if any) doesn't necessarily have to have anything to do with it.

But then, power plants....

Oh well, it still makes more sense than filling your planet with 'financial districts' or 'markets'.

 

[ashbery76]

Because Alpha centauri.

 

[Harle]

Just because it failed in Germany, it doesn't mean it fails everywhere. Australia for example has done exactly that on a nation wide scale, and it succeeded. The US has retired the half-cent in 1857 for the same reason. And if you take a look at India, you can see what happens if the material coins are made of is worth much more than their face value. They have a coin shortage because people do that.

Canada did away with the penny a while back. Everything is chugging along swimmingly. Just throwing that out there.