I don’t completely disagree with your comments on inflation and money supply, buy your basic economics needs some work.
I believe this is an incorrect statement:
“For any commodity … its real value (use value) is defined by its function”
This is not its “real value.” That is its “value in use”
Each individual has a different value in use for each commodity.
A commodity’s value in use is defined by its function, but its real value is the highest price someone is willing to pay at a given instant in time. Period.
I also disagree with this:
“From that time on, taking in to account depreciation, changes in location desirability (assuming constant use value and reasonably stable wages), the price of the property is completely a function of the value of the currency.”
It may also be a function of the availability of capital – related to, but not the same as “value of the currency.”
Also, we can see an example of how value in use is not the “real value”. A commodity may have a constant value in use, and currency may have the same value, but if nobody can borrow the money to buy it, the price they are willing to pay can go down. Thus, the value of the commodity goes down.
I think the housing increase has not been entirely a result of currency devaluation, but a mis-valuation of mortgage debt instruments by Wall Street that has let to rampant lending of money that should never have been lent.
