On Mar 11, 2008, at 1:57 AM, David B. Shemano wrote:
I am truly curious -- do you (and others on this list) really,
really, reject that value is subjective? It is so self-evidently
true to me that it is hard for me to even conceptualize the
opposite. I understand the labor theory of value as polemic, but as
philosophically correct, I don't get it.
This is at bottom a verbal misunderstanding. "Value" is both a noun
and a
verb. As noun it is by definition objective, the name for an
"object" (of thought or action). As verb ("to value') it pertains to
the subjective act of valuation . Prices are the objective result of
the interaction among huge numbers of subjective valuations. The
difference should be clear from ordinary capital theory: the price of
a share of General Motors was one thing in September 1929, and we know
it from looking in a newspaper. We know now to a very close
approximation, in March 2008, the value of a share of General Motors
at that instant of time: it was the sum of all dividends paid to that
share until now (adjusted for stock splits) discounted by the
appropriate interest rate, plus the similarly discounted price at the
present moment. And because all these monetary sums are now known,
with perfect certainty, the appropriate 1929 interest rate to discount
all those future dividends is the then-rate for a security whose
future payout is known with equivalent certainty (ideally a sovereign
debt instrument with no expiration date, a "Consol"). The distinction
between price and value of a commodity, though determined altogether
differently, is like that between price and value of a capital asset--
the difference between an objective historically determined reality
and a transient resultant of interacting subjective valuations.
Shane Mage
"Thunderbolt steers all things...it consents and does not consent to
be called Zeus."
Herakleitos of Ephesos
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