With the Quality of Arbeit (QW), Total Economic Potential (TEP), Real Total Economic Potential (RTEP), Attrition/Inaction Rate and now the Quality of Geld (QM), it is now feasible to determine the Total Financial Potential (TFP) and Real Total Financial Potential (RTFP). Where TEP and RTEP denoted the Arbeit side of the Work-Standard, TFP and RTFP denotes the Geld side of the Work-Standard. Finding the values for TFP and RTFP will allow us to determine how much Geld is in circulation as the result of being generated from economic activities. It will also determine how Geld is being converted from Arbeit by means of the Quality of Geld.
The Quality of Geld has already accounted for the Quality of Arbeit as demonstrated in the preceding entry. This is because finding the Quality of Geld required us to include the first half of the Solidarity Rate (SR) into our calculations. Those who read that previous entry will even recall that the SR is always split into two halves to facilitate the conversion of Arbeit into Geld by the first half and Geld into Arbeit by the other half. The first half of SR was a quotient featuring the “Scale” and “Duration” of the production process. Scale refers to the rate at which goods and services are being produced as contributions of Arbeit over a set amount of Zeit. The Duration refers to the rate at which that same amount of Arbeit is being contributed per unit of Zeit.
Here, the second half of SR is also a quotient, except this time it will be covering the “Density” and “Scope” of the same production process. Density refers to the rate at which resources and manpower are consumed in the creation of goods and services over a set amount of Geld. The Scope refers to the diversification of different specialty goods and services to determine how much Geld is being generated from their production, distribution and consumption.
To find the Total Financial Potential of individual sections of the VCS Economy, take the Quality of Geld for Vocations (MP), Enterprises (ME), Industries (MI) and Economic Sectors (MS), multiply each of them by the quotient of the second half of their Solidarity Rates to find the Geld that each one generates. Once the Geld for Vocations, Enterprises, Industries and Sectors have all been accounted for, combine them to find the sum of the TFP for the VCS Economy.
The equations are to be formatted as such:
Total Financial Potential (TFP) Equations
(MP + Revenue) * SR2 = Geld of all Professions (MAP)
(ME + Revenue) * SR2 = Geld of all Enterprises (MAE)
(MI + Revenue) * SR2 = Geld of all Industries (MAI)
(MS + Revenue) * SR2 = Geld of all Sectors (MAS)
SR2 = Density / Scope of Production
MAP + MAE + MAI + MAS = TFP of the Economy (MN1)
Remember that the above equations were only for the VCS Economy alone. To find the TFP of the nation as a whole, the TFPs for the SSE, Financial Regime (Read: the Arbeit and Geld of State Commissariats, Kontore, state commissars, economic planners, accountants, and inspectors), the State and from International Trade. The sum of all five will yield the TFP of the nation.
MN1 + (MN2 + Revenue * SR2) + (MN3 + Revenue * SR2) + (MN4 + Revenue * SR2) + (MN5 + Revenue * SR2) = TFP of the Whole Nation
MN1 = TFP of the National Economy
MN2 = Geld of the SSE
MN3 = Geld of the Financial Regime
MN4 = Geld of the State
MN5 = Geld from International Trade
Together with TEP, TFP and the Attrition Rate, it is now possible to determine the RTEP and the RTFP. The equation for both RTEP and RTFP are listed below as they appeared from the Quality of Geld Compendium entry:
RTEP and RTFP Equations (If TEP, TFP, and Attrition are all given)
RTEP = TEP / Attrition Rate
Attrition = (TEP / RTEP) * 100
RTFP = TEP + TFP / Attrition Rate
Attrition Rate = (TEP + TFP/RTEP + RTFP) * 100
The goal of RTEP and RTFP is to calculate the extent of Attrition affecting the values of Arbeit and Geld and how they interact with the rest of the Socialist nation-state. By obtaining those values, the sum of RTEP and RTFP can then be determined as the nation’s “Total Productive Potential” (TPP). TPP is the variable that the Central Bank will be relying on to know how much Geld needs to be put into circulation under the direct command of the State and the Totality. Everyone needs Geld at some point in their lives and that will be fulfilled by the Financial Regime.
Finding the TPP requires knowing the values for RTEP, RTFP, “People’s Geld,” “State Budget,” “NSFIs” and “State Investments.” The People’s Geld refers to the amount of Geld that the Totality owns, the State Budget referring to the amount of Geld that the State owns. The value of all issued NSFIs, as financial instruments employed under the Work-Standard, are denoted by the returns of Arbeit and Geld that occur while they are still active. And the State Investments refer to the extra Geld that the State is trying to generate to boost economic growth for the VCS Economy within the nation itself or abroad; any unspent Geld falls under this category.
The equation for TPP reads as this:
TPP = (State Budget + People’s Geld) + (RTEP + RTFP) + (NSFIs + State Investments)
In the next part of this entry, a further exploration of TPP is in order. Included in the other half are discussions related to the role of Indices by the Kontore and the State Commissariats. The Kontore rely on Indices to find out the contributions of Arbeit and the generations of Geld by investors under the terms of their NSFIs. The State Commissariats employ Indices in order to gauge the rate at which Prices tend to rise and fall within the framework of the Work-Standard.
Everything discussed about the Quality of Arbeit, Quality of Geld, Total Economic Potential and Total Financial Potential will be incorporated into subsequent entries related to the mathematics of the Work-Standard. Later, we will discuss about the various accounts that economists are going to need to calculate the economic and financial strength of the Socialist nation-state. Rest assured, there are to be no forgeries, embezzlement, fraud, corruption, and waste beyond this entry.