four dimensions

Capitalistic systems and liberalistic economies are economic systems comprised of four dimensions: people, goods, money and time. A capitalistic system is built upon a balance of people, things, the value of money, and the value of time.

People are represented by income, goods by production, money by expenditure and time by interest. The balance of people, things and money is achieved by the balance of time, i.e., the balance of short time and long time.
The key question is, “What system maintains the balance of people, things, money and time?” With a short-term view, it is necessary to clarify the relationship of two balances: the unit period balance in terms of profit and loss and the long-term balance in terms of funds.

For controlling the national economy, control of the total quantity and ratio of the currency is important. This is because the foundation of monetary value lies in debt. The control of the total quantity of the currency means the control of the national debt. The control of the national dept must be proportional to the scale of the economy.

In a money economy, debt never ceases to exist. The idea to eliminate debt as much as possible denies the very existence of a money economy. A money economy comes into existence when debt is acceptable as an active factor.
To adjust the total quantity control of the currency means to clarify lending and borrowing by sector and adjust the standard of overall lending and borrowing as well as the rates occupied by respective sectors.

Like the movement of a pendulum, the movement of a market economy is controlled by swing and balance.

The most important elements of the economy are swing and oscillation.

Balance in accounting consists of inner balance and outer balance.
While the inner balance refers to the balance that is inside the economic entity, the outer balance refers to the balance outside the management entity, that is, the balance of the market.

It can be said that contemporary economic systems are based on loans.

While expansion of negative space promotes economic growth, shrinkage of positive space restrains economic growth. The fluctuation of a contemporary economy is controlled by its balance.

The level of the total quantity of the currency is the sum of surplus funds, that is to say, the sum of deficient funds.
The rate of the currency means the shortage and overage in households, corporations and the government and the rate of the capital balance in funds.
The current fund level has been on a declining trend overall because household savings are increasing, and at the same time, corporations are repaying their loans. Therefore, the financial deficit and cash flow are increasing. This means that, under the current situation, the more household savings increase, the more the financial deficit goes up.
To clear away the amount of debt accumulated in each sector, it is necessary to plan to resolve the debt by making use of the time structure of fund operations. Accordingly, it is difficult to eliminate debt under a single-year budget system.

The overall structure of fund shortages and overages depends on the amount of the money supply. Also, the sum of fund shortages and overages is zero.

Market conditions depend on the base money, the money stock and the supply of and demand for goods. The money stock is drawn from the turnover of the base money.

The problem is that the structural balance is cumulative. The only way to eliminate an imbalance based on the unit period is to use the short- and long-term time structure.
The imbalance can be eliminated by adjusting the long-term changes of the economic structure and the structure in the unit period.
An additional incentive to clarify the profit and loss structure and the lending and borrowing structure. While profit and loss represents a dynamic structure in the unit period, lending and borrowing represents a static structure at one point in time.

Bad obligations are essentially a problem of bad debt. Bad debt is debt to be amortized over a certain period. This is because bad debt is a problem in the functions of long-term funds.

The fundamental problem of contemporary economy is that finance cannot help but borrow money excessively because households and corporations are afraid of borrowing money.

The balances of cash flow and fund shortages and overages among economic entities can be classified into seven aspects.

The present economy looks like a boiler with no water left in it. The market economy is controlled by market mechanisms. Market mechanisms come into existence through positive and negative functions working in the market. If you look at only the positive functions of the economy and neglect the negative functions, you cannot control the market.

Revenue is a money collection device. The present revenue mechanism depends much on the tax system. This is because national projects lack, or disregard, the idea of profit-making.

The biggest problem is that the concept of the public sector tends to eliminate the concept of profit-making. The idea of privatization of public works arose from such a tendency. But, it is difficult to privatize all sorts of public works.
The biggest cause is that the public sector will not accept the idea of periodical profit and loss. In short, what we should do is nothing but to change the sense of value that making profits is not good. This is a problem in thinking.

If we took Greece as an example, a review of the ideal state of the revenue mechanism would involve exchanging the value of the tourism industry into stocks based on tourism resources as funds.
In this way, the number of public servants and public obligations could be reduced, private investment could be promoted, new industries could be launched and private sector jobs would be created.
With intensified restrictions, tourism resources and regulations are protected by national laws. Better quality tourism resources and tourism services would invite more tourists who would generate more profits.
The problem in Greece is that they are still unable to convert their globally preeminent tourism resources into marketable properties.
They are not fully aware of their own resources, and therefore their services are not good. Such a condition crushes the value of national assets in Greece remarkably.

The economy is an activity of living, but merely thinking about what kind of society to have or what kind of way to live is not enough. This is why we lose sight of the essence of the economy.


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