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GTA36362355

An economy without money and urbanization

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GTA36362355

I have been thinking about this a lot lately.

I didn't intend this to be a debate but I think a debate will help in shaping this economic model which works without money and urbanization.

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The two major points of this model must be:

 

1. No money!

Money is the root to most modern day evils. An economy without money is the main aspect of this model.

I was thinking of a modern barter system with production and distribution being done by an organized body under the government.

Working population is employed with this single organization.

Authority is decentralized and balance of authority-responsibility-accountability is somehow managed.

Also, I am not saying no to privatization, I'm saying no to over-profiting industries.

 

A lot is to be discussed about how it can function.

 

2. Close to nature.

No densely populated cities but balanced habitats and industrial areas.

Environment has degraded a lot in the past few decades. Sustainable development is only in theory. The model takes an extreme step of leaving urbanization for going back to nature. No more concrete jungles.

I do not suggest abandoning technology, I propose abandoning the current idea of development. 60% of attention is to be given to environment maintenance while the other 40% goes to development of an economy functioning without money. The needs being provided by the organization in return for the work they do in production.

Huge distribution requires transportation facilities and thus transportation infrastructure is of prime importance along with production.

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Please avoid the description of those two points if you wish as they are just my ideas.

 

I just want to know how a world like 'Avatar' (not THAT exaggerated) can function.

Just keep these two things in mind:

1. No money or similar instruments.

2. Close to nature.

 

This is a model so there are some assumptions:

The economy is the only nation on the landscape. Think of this as making a new world on a twin-earth.

Resources are scattered but none are missing. Obtaining and processing those resources is necessary. There are no unreal quantity of resources though.

Size and population of this world is not amazingly vast as this would hinder conclusions. We can start with a small arena and let it grow considerably. *Rise of nations?* (This is not a game, just want this model to work.)

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Not wanting to make this post too long to read, I leave everything open for debate and discussion.

 

We can enlist problems and think of ways to solve them.

I request those participating to not play devil's advocate for a while and take an optimistic path in shaping this model.

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AND NO, this is not my home work/project or something like that. This is just a thought which keeps playing in my mind.

 

If you are a pessimistic f*ck and want to throw away this model saying, 'this is useless, this can never work', please avoid this post and proceed somewhere else with a smile in return.

 

 

Though it seems impossible to implement such model in the real world, there can always be a chance of one catastrophic event wiping out the majority of the world population and a slight less chance of a few GTAFians surviving and making a new world. wink.gif

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sivispacem

Money at its simplest is a number applied to a product or service to value its worth. Traditionally currencies were based on a commodity and many still are. If you remove money, replacing it with (say) a service/goods derived barter system, you are faced with two problems. One, how does someone who does not have something a seller wants purchase a good or service? And two, how do you establish an easy to understand way of expressing the perceived worth or a good or service, when the commodity used to purchase said good/service is not standardised? Do you, say, place a comparative number created by the marketplace to assess the comparative value of commodities? That seems like the only viable solution.

 

Guess what? That's a monetary system. In brief, I cannot see a way of creating a non-monetary system which doesn't end up being a monetary system in itself.

 

Also, without a monetary system or some system which allows fluid transition of purchasing power, how would one (be they a government, a company or an individual) fund hypothetical goods or services such as research, manufacturing, food cultivation or environmental protectionism? Because there is a need for immediate resourcing but no immediate comparable return, I can't see the holders of readable commodities being able to agree on terms that make such ventures worthwhile. If you are paying me on food, board, water and transport to design you a new piece of technology, how can you recoup your investment if I use the commodities and you don't get what you want out of it? I think you'd struggle to quantify your debt in cereal fir a non-delivered computer and even if you could, the resources are expended- how can they be recovered? Then your back to comparative values and that's basically a monetary system anyway.

Edited by sivispacem

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GTA36362355

With money, I meant the current money system.

The model which I'm proposing does have a value system. As I said, the necessities and amenities are provided in return for the service provided by the people. The higher the production of an individual, the higher standard of living he/she is provided with.

About your question regarding scientists being given facilities despite their failure in research: Its the cost of research. Its investment and not all investments reap benefits.

 

I'm against materializing value. This leads to need to earn money which is also the reason for various criminal activities as well as migration to urban areas. If there is no flow of material value, most illegal activities can stop because there is nothing to earn except higher standard of living which is provided by the organization.

 

I want inputs to develop this system from you guys. How can this work?

 

Edit: Also, there is no sale or purchase in this economy. Everything is rationed and provided by the organization. Everything produced is for people and by the people. No one does a business. Everyone does a job. The necessities and amenities are given according to the responsibility they take upon. The quantity depends upon a family's needs and quality depends upon the level of work they do. Obviously there is a standard quality and quantity below which it cannot fall.

Edited by deepthroatgta6

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sivispacem

If you want to develop a theoretical economic system rather than discuss the merits or otherwise of a theoretical one, D&D is not really the place to do it. Here, you'll get some suggestions as to what you could include or alter, but the majority of responses will be people debating the merits of said system and picking holes in it, so you're either going to have to take it elsewhere or take the rough with the smooth and discuss potential flaws. I'm quite interested in this theory- tell me, what about the value system of your proposed economic model is inherently better than the current economic system? A government monopoly on both the proposed value of goods and services and on their distribution is only as good as the government itself, and one of the strengths of democratic government in economic terms is that much of the real economy operates outside of government interference and is therefore difficult for bad government to corrupt. How do you propose you protect your value system which may or may not be a monetary system somewhat like and/or possibly somewhat unlike the current one from the exactly same flaws that you highlight in the current economic system, for instance? How do you promote entrepreneurship, human advancement, ingenuity and individual progress (on which a good economy should be based) without prejudicing the system in favour of a few at the expense of the many and therefore giving rise to an economic monopoly of individuals whose actual societal value is open to debate but who have established and working, mutually beneficial relationships with a government?

 

Also, how can you be against materialising value and yet assign values to material, as you must to have an economy? It seems like a compete contradiction to me. You cannot remove material value from an economy without removing the value of materials, and once you do that trade becomes an individual force outside of regulation and that gives rise to individual profiteering as those with the goods that are most in demand can effectively set whatever price they want for them outside of any system of understood value.

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GTA36362355

That is what I wanted to discuss. I posted this in the D&D section because I thought that moulding a system while considering every flaws is a good way to create perfection. I'll definitely take time to think and answer your post. I'll edit this post for the same as I myself am not ready with an available answer but I want answers to the same flaws.

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Chunkyman

1.) "Money is the root to most modern evils". Money is no more the root of evil than forks are the root of obesity or guns are the root of crime. Individuals and their actions are the roots of evil and good, not inanimate objects. Money is a (highly useful) object that allows us to advance beyond the incredibly inefficient barter system and instead use a medium of exchange that gives us greater freedom in trading with people. Barter systems were abandoned because the economy can't really advance beyond trading food and handmade tools without money to facilitate the trade of more complex items. Even something as basic as a

requires hundreds of thousands of people working in conjunction in order to produce something. No barter system (or centrally planned system) could ever efficiently produce such items because the things involved in their production is so complex that only a price system can successfully work.

 

Trade is basically the only way to create significant wealth, due to the immense productive power unleashed by the division of labor. Therefore, reducing trade (like removing money would do) would reduce the division of labor, which would in turn make us all significantly poorer.

 

2.) As mentioned previously with the example of the pencil, centrally planned systems cannot work. When prices are allowed to move up and down freely (as they are in a free market), they sent what are called price signals. Price signals are how resources are efficiently used because they transmit information to both the producers and the consumers which helps determine what is produced, how much is produced, and for what price the item will be sold for. Centrally planned systems can't use price signals for information because they don't have any (no free floating prices = no price signals). Instead they have to rely on whatever the leaders arbitrarily decide. Having resources allocation/production being based on the ideas of central planners always fail because of what is often called "the knowledge problem".

 

Some real world manifestations of the knowledge problem in central planning include overconsumption, surpluses, and shortages (with shortages being extremely common)). The Soviet Union was infamous for this problem, with people having to wait in line for 6+ hours to get things like bread or toilet paper (and just about everything else). This problem is observed even in countries typically called capitalist. Congestion on highways (AKA an overconsumption of road space) is the result of their being no price signals altering the demand for using the road. Since roads are "free" (and thus have no price variance in the cost of utilizing road space) people tend to over consume and cause massive congestion (and pollution). Another instance is centrally planned medical services. Despite being "free", all suffer from shortages (and overconsumption) that manifest themselves in long waiting lists for treatment.

 

I'm a terrible explainer of things, but Learnliberty is a good source of basic, easy-to-digest information if your interested in learning about free markets and why they're inherently better than centrally planned economies.

 

 

Edited by Chunkyman

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GTA36362355

I assumed that the problems in production and distribution can be solved with proper management. Why only look at negative experiences of the past? Rationing every single thing is possible with advanced technology and methods. People buy commodities and services everyday yet there are no queues because they pay money. Now lets make them swipe their amenities card which gets recharged every pay day. I called 'money' the root of evil because it has turned into a necessity. It is required to buy anything and everything. Your point stands correct at individual actions being responsible for those evils but think of it again, those actions are due to requirement/greed of amassing wealth.

Yes, the model which I propose loses out on providing personal freedom but it is for the greater good.

 

I totally understand the advantages of a free market but when commodities are not to be valued on demand-supply but instead on necessity, what's the use of a free market? A central planning plans centrally but functions through decentralized sub-organizations, each made to carry out their functions perfectly.

Knowledge problem and other such problems related to over production/under production do not exist in extreme levels like they were in the 20th century.

 

Also, I mentioned assumptions regarding the scale of population and geography. This is a model.

 

Lets just make it an economy consisting of 5000 people. No resources are missing and out of these 5000 people, only 2000 people are involved in production, and by production I mean, obtaining/processing resources, creating commodities/services and distribution. Isn't the technology today efficient enough to provide for 5000 people's necessities with human force of 2000 people?

 

Another aspect of the model is getting close to nature which is very important to sustain the world we live in. This deserved 60% importance in the model i described.

 

My thought went this way: Need to sustain environment - necessary to remove factors degrading environment - urbanization, a major cause - why urbanization has become necessary? - wish to amass wealth for a better standard of living - why wealth becomes the basic requirement to enhance living? - a better alternative: a place where human necessities and environment are maintained together.

 

I know that the model is full of flaws, its just a draft. I am again saying that I just intend to make a model fulfilling the two basic necessities I mentioned. Can an economy exist without the use of tangible currency but with the use of technology with priority being given to directly increasing standard of living instead of forwarding wealth to the people?

Can economy be developed without urbanization? Can we leave the concrete jungle and move towards natural habitats?

Edited by deepthroatgta6

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Finn 7 five 11

Sounds similar to communism now, everyone has equal jobs that are allocated to them and gets similar benefits.

 

Without money we would just resort to some other form of worth like trading grain (as an example) and it would be the standard as Sivis mentioned.

 

Guess what? That's a monetary system. In brief, I cannot see a way of creating a non-monetary system which doesn't end up being a monetary system in itself.

 

Many claim rich people are the evil, but without people getting rich and trying to make more money we wouldn't have many of the things we have today, who would have invented touch screen smartphones if there wasn't massive money involved in developing it to reap massive profits?

 

Who would spend millions/billions developing all this technology we have? A lot of the technology you speak of would not be present if it wasn't for the rich, as Sivis mentioned as well, what would fund/promote research and such?

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sivispacem

 

I assumed that the problems in production and distribution can be solved with proper management. Why only look at negative experiences of the past? Rationing every single thing is possible with advanced technology and methods. People buy commodities and services everyday yet there are no queues because they pay money. Now lets make them swipe their amenities card which gets recharged every pay day. I called 'money' the root of evil because it has turned into a necessity. It is required to buy anything and everything. Your point stands correct at individual actions being responsible for those evils but think of it again, those actions are due to requirement/greed of amassing wealth.

I cannot fathom any way of creating a system, this one included, which does not lead to individual profiteering of one kind or another. Individuals can still amass wealth if trade takes place under free market conditions; if you limit the market and run it centrally rather than on demand, it's the government who benefits not the citizens. In my view, any trade system be it based on money or commodities cannot be run centrally as government tend not to have the first clue about the minor fluctuations in a market which in a normal monetary system would be ironed out by, say, changing comparative lending rates or reducing the equivalent cost of a good or service, but I cannot honestly see any government-run central organisation responsible for administering such a system as both so overarching as to prevent profit-motivated side-dealing, black-marketeering and secret free trade, and yet so agile as to be able to react properly to ever fluctuation in supply and demand. I just don't think it's at all possible.

 

 

I totally understand the advantages of a free market but when commodities are not to be valued on demand-supply but instead on necessity, what's the use of a free market? A central planning plans centrally but functions through decentralized sub-organizations, each made to carry out their functions perfectly.

Who has the right to determine what is necessary and what is frivolous? Are you suggesting that in order to accurately assess need and necessity, some of these decentralised organisations, say with an area of jurisdiction, must make every decision as to whether any item is necessary in a given scenario? I mean, it's not like you could produce hard and fast rules to govern it. My next door neighbour doesn't need a concrete mixer but I'm building a house so I do, so is it frivolous or necessary? And if my neighbour wants to obtain a concrete mixer so he can also build a house, is that necessary?

 

 

Knowledge problem and other such problems related to over production/under production do not exist in extreme levels like they were in the 20th century.

Yes they would. If anything, an economy with a monolithic, centralised and compartmentalised government body handling distribution and economic policy as well as supply and demand would be drastically worse at managing under- and over-supply purely because there would be little to no impetus to actually get it right. In a free market with economic competition, over- and under-supply are economically harmful to a company and their stakeholders, which acts as a deterrent and makes estimating requirements very important indeed. How does a government, which has no connection with purchasers or end users of economic services or products usually, go about ascertaining and estimating requirements of its citizens any better than a company does, especially when over- and under-supply in this example wouldn't actually directly affect the decision maker and therefore they would be isolated from the consequences of their own mistakes- a very dangerous idea.

 

 

Lets just make it an economy consisting of 5000 people. No resources are missing and out of these 5000 people, only 2000 people are involved in production, and by production I mean, obtaining/processing resources, creating commodities/services and distribution. Isn't the technology today efficient enough to provide for 5000 people's necessities with human force of 2000 people?

I'm not quite sure what you're getting at here. Your right to say that only a proportion of any economy is actually employed in the direct creation, distribution or management of goods or service, but I fail to see the relevance. Are you suggesting that the remaining proportion of the population work on something not directly related to the creation, distribution and management of goods and services? Whatever this would be (I'm thinking something environmentalism-related), it would still be indirectly if not directly related to those two thousand hypothetical individuals doing the G+S stuff. And that's largely how economies work anyway, though perhaps with a different balance. You've also got to remember that not everyone in a given economy can be economically active, either in a passive or contributory sense.

 

 

Can economy be developed without urbanization? Can we leave the concrete jungle and move towards natural habitats?

Urbanisation is a direct effect of the transition from individual, cottage-type industry to multifaceted progress-dependent industry. Cities simplify distribution of goods and services; they save on transportation costs and provide an environment in which work and home coexist in close proximity, which is beneficial for the actual industrial process. I would argue that a move away from urbanisation is actually more environmentally harmful than a continuation of it, because even with your hypothetical economy distribution would still be required, and whatever method you use will pollute the environment in some way. The more time and energy spent on distribution, the more harmful it becomes; the closer the proximity between the producer and the consumer, the less time and energy spent on distribution.

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Tchuck

Money is a tool, nothing more, nothing less. It enables you to do things, it enables you to trade things, it enables you to place value on things so you're sure you'll always be able to do something with it. It allows you to take up any trade you wish and have something with which be able to acquire what you need.

 

Valuing something on the merits of "need" or "necessity" simply doesn't work, solely due to the fact that it's not something that can be objectively determined. And if it can't be objectively determined, it's useless as a measurement.

 

If you really want to take a look at a system that is similar to what you are suggesting, I suggest you read Thomas More's Utopia. It was written around 400 years ago, give or take, and explores an imagined voyage to an imagined country with a system vastly different from the norm, based on trading and the community rather than the "individual needs".

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GTA36362355

^Suggestion taken. Reading it. Thanks.

 

 

Lets just make it an economy consisting of 5000 people. No resources are missing and out of these 5000 people, only 2000 people are involved in production, and by production I mean, obtaining/processing resources, creating commodities/services and distribution. Isn't the technology today efficient enough to provide for 5000 people's necessities with human force of 2000 people?

I'm not quite sure what you're getting at here. Your right to say that only a proportion of any economy is actually employed in the direct creation, distribution or management of goods or service, but I fail to see the relevance. Are you suggesting that the remaining proportion of the population work on something not directly related to the creation, distribution and management of goods and services? Whatever this would be (I'm thinking something environmentalism-related), it would still be indirectly if not directly related to those two thousand hypothetical individuals doing the G+S stuff. And that's largely how economies work anyway, though perhaps with a different balance. You've also got to remember that not everyone in a given economy can be economically active, either in a passive or contributory sense.

With the other 3000 people, I meant children and retired citizens.

 

 

 

Thanks to all the above posters for directing me to the main flaw of this system: trying to remove money. Money is definitely a catalyst in developing the economy so I cannot blame it to be the source of any problems and any alternative will ultimately act as money.

The second flaw is: removing the free market system based on demand/supply. A government may estimate the demands of a population of 100 people but an economy is too vast to procure correct estimates.

Also the point about requirement of a concrete mixer proves a flaw of this system. Where will a citizen go for this kind of demands?

 

About moving away from urbanization, I still am not sure how pollution will increase just because of more transportation cost. More environment friendly mediums can be used for transportation.

Urbanization has this characteristic of densely populated area and urbanization creates a society which only concentrates on moving comparatively above in terms of wealth from other citizens, this leads to more purchases of luxurious commodities which at the end of the day is degrading the economy. Not only it is a waste of resources, but it also turns out to be polluting the environment in most cases. For e.g. cars. The densely planned buildings increase temperature and emissions made by cars and air conditioners increase global warming. There are slums and poor health conditions.

Edited by deepthroatgta6

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sivispacem

 

About moving away from urbanization, I still am not sure how pollution will increase just because of more transportation cost. More environment friendly mediums can be used for transportation.

All else being equal, greater distances will be travelled in a non-urban environment and therefore regardless of method of transportation pollution increases. Of course, as you point out, you could use more environmentally friendly transport mediums, but mediums that do not rely on a) internal or external combustion, b) extensive use of machinery in construction or operation and c) do not have the potential to cause physical harm to the environment are rather limited in their scope, especially in a non-urban environment. The greater the average distance between individual end users and the producer, the more need for a mechanical and therefore not ecologically friendly method of transportation to fulfil their distribution tasks. In short, it's simpler and less environmentally costly to distribute a good or service to a selection of end users in a relatively small geographical space than it is a larger one.

 

 

...this leads to more purchases of luxurious commodities which at the end of the day is degrading the economy.

You need to substantiate this because I don't think it's even close to reality. I've seen absolutely no evidence that the increasing purchasing power of consumers degrading a domestic economy; quite the opposite in fact. What measure are you using to assess economic strength which has resulted in you reaching the conclusion that increased economic expenditure actually harms the economy? It's almost a self-contradiction.

 

 

Not only it is a waste of resources...

Waste by whose standards? Concepts like this are very subjective- refer to my earlier discussion of the pitfalls of discussing necessity versus frivolity.

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GTA36362355

More money going towards buying luxurious commodities whose price tag is much higher than its production cost causes inequality of wealth. The rich becomes richer while the poor bears with inflation. In this sense, it is degrading economy.

 

Just because of fewer number of environment friendly mediums, it cannot be concluded that transportation is a costly in longer distances. Also, I haven't as well talked about going rural instead of urban. I'm talking about a residential setting which is not as dense and populated as most cities of the world. Industrial units are on the outskirts of these residential areas and these factories transport their goods via electric trains. All the factories share this single medium and thus transportation cost per unit is less because operating cost of trains is distributed over many factories. The factories only focus on the demand of the residential area they are near to geographically and are scaled in the proportion required to fulfil their demands.

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sivispacem

 

More money going towards buying luxurious commodities whose price tag is much higher than its production cost causes inequality of wealth. The rich becomes richer while the poor bears with inflation. In this sense, it is degrading economy.

Economics doesn't work like that in reality, though. If anything, having a multi-tier economy where individual compete for a finite number of commodities at a variety of levels is actually better at slowing inflation than a "fair" economy where everyone competes for the same commodity pool. It's when large numbers of people demand a finite good or service that you get inflation- in that respect, the "luxurious commodities" argument is logically flawed as because the truly wealthy are so small in number price inflation on these goods is not caused by competition but by fluctuations in the costs of raw materials and related services. A standard, run-of-the-mill stereo system probably costs five times as much as it's build cost, but a high-end professional quality one from a smaller, niche manufacturer would cost only perhaps 30% more than its build cost- the demand for the former having a greater impact on the pricing of the product than the tangible costs in it's making. Of course, there are some commodities which all people compete for either directly or indirectly at the same level- fuel, for instance, and certain foodstuffs- but these are the drivers behind general inflation, not the luxurious products you allude to. Think of it this way- do you think it's fairer for your purchasing power to have to compete with, say, 2 million people in a roughly similar income band to yourself, or 20 million people including those considerably wealthier than yourself? This is why you get so many versions of what is essentially the same product- appealing to different sectors of the economy.

 

 

Just because of fewer number of environment friendly mediums, it cannot be concluded that transportation is a costly in longer distances.

Yes it can. It's pure logic. In any given scenario, if you are transporting the same item or items the same way, then the one that travels the furthest distance has the most potential cost. If you are not comparing like with like, then it's a pointless comparison.

 

 

I'm talking about a residential setting which is not as dense and populated as most cities of the world.

Can you explain to me why a less densely populated residential setting is any more environmentally friendly per inhabitant than a large, high-density city? I don't think its logical at all, for a number of reasons:

 

1) By its very nature, an environment with a lower population density and the same number of inhabitants takes up a larger land-mass than an environment with a higher population density and the same number of inhabitants. Hypothetically, if you want to permit the maximum prevalence of unsoiled natural ground in a given finite land-mass (such as a country), the best way of achieving it would be using extremely compact, very high-density cities

 

2) As well as the increased cost in transportation due to a lower population density (all else being equal, such as location of factory in question and proximity to living environment), residential environments with lower population density will by their nature be less energy efficient than those of a higher population density, again all else being equal. Electricity supplies suffer transmission losses; additional energy is used in providing pumping for water and sewage to supply homes over longer distances, heat dissipation into the environment during winter months is increased as compared to air brick, steel and concrete are very good at retaining heat- therefore meaning higher heating costs. The only real advantage I can see is giving a larger surface area for the mounting of photovoltaic cells for electricity generation or thermal cells for water heating, but the former is a very inefficient and environmentally harmful way of producing electricity (heavy metal treated glasses, complex electronics) and the latter could be managed better with ground-source heat pumping, which would be less costly to operate for the same net effect in a smaller environment.

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fgcarva1

I'd love to discuss but I cannot create arguments in sivis-level yet so I'll sit back and post this movie which can help those of you who do not understand the issue at-hand get to know it better.

 

- Whilst I appreciate the contribution, please don't post YouTube videos without some kind of explanation of their content. Not everyone can always view YouTube and some of us post from mobile devices with data restrictions, so it's always good to summarise a video so it can still be discussed -

Edited by sivispacem

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