Social Structure And Network (A Mathematical Model For Social Behaviour)

Analogy and metaphor are often used by social scientists to explain a social phenomenon because certain social concepts are otherwise very difficult to comprehend. For example, a physical structure like ‘building’ or a biological structure like ‘organism’ is compared to define the concept ‘social structure’. Actually, social structure is not a physical structure. An abstract concept which can’t be seen is explained in a simplified way by using an analogy which can be seen easily by everyone. Physical scientists use a model to test the predictions. If the predictions are correct when the model is tested every time then the model constructed is perfect. Otherwise, the model is suitably modified and then the predictions are tested again. This process is continued until the model becomes perfect. Do we have a grand model of social structure that can be used to test social predictions? In this article, an attempt is made to understand how far network theory is useful in explaining social structure and whether social predictions can be made using the network.Radcliffe-Brown was one of the earliest to recognise that the analysis of social structure would ultimately take a mathematical form. Radcliffe-Brown defines social structure as a ‘set of actually existing relations at a given moment of time, which link together certain human beings’. According to Oxford dictionary, ‘relations’ means the way in which two persons, groups, or countries behave towards each other or deal with each other. The phrase, ‘link together certain human beings’ can be compared with a ‘net work’ of connections.Network is defined as a closely connected group of people who exchange information. Each point (person or agent) in the network is called a ‘node’ and the link between two nodes is connected by a line called an ‘edge’. When two nodes have a direct social relation then they are connected with an edge. So when a node is connected with all possible nodes with which the node has social relations, it produces a graph. The resulting graph is a social network. The number of edges in a network is given by a formula nc2, where ‘n’ is the number of nodes. For example, if there are 3 people in a party then the number of handshakes will be 3. If there are 4 people then the number of handshakes will be 6. If there are 5 people then it will be 10. If there are 10 people then the number of handshakes will be 45. If there are 1000 people then the number of handshakes will be 499,500. When the number of people has increased 100 folds from 10 to 1000, the number of handshakes has increased 10,000 folds. So the number of relationships increases significantly as ‘n’ increases. The network theory was developed by the Hungarian mathematicians, Paul Erdos and Alfred Renyi, in the mid twentieth-century. Networks of nodes that can be in a state of 0 or 1 are called Boolean networks. It was invented by the mathematician George Boole. In Boolean networks, the 0 or 1 state of the nodes is determined by a set of rules.If two nodes are connected then the network of the two nodes assumes four states (00, 01, 10, and 11). The number of states of network grows exponentially as the number of nodes increases which is obtained by a formula 2n, where ‘n’ is the number of nodes. When n is greater than 100, it is quite difficult to explore all the possible states of the network even for the world’s fastest computer. In a Boolean network we can fix the number of states as 0 and 1. In a Boolean network, if there are three nodes A, B, and C which are connected directly by edges then the state of C can be determined by fixing the states of A and B. It means the state of C depends upon the states of A and B in some combination. Further it implies that if we know the state of C then we will know the combinational behaviour of A and B. But in a social network of persons, we do not know how a person’s behaviour is deterministic. Further, in a Boolean network, the behaviour of the nodes can be studied in controlled experiments as nodes here are objects. But in a social network, nodes which are individual persons can’t be treated as objects. In a social network how do we define the states of a person? How many states does a person have? What is the nature of a state? If the expected behaviour of a person is reduced to two states like ‘yes’ or ‘no’, then the number of states of a network will be 2n. Out of this, only one state will show up at a given moment of time. How do we predict that one particular state?Family is a micro network within the network. The family members are closely connected with each other. Most of the members are also connected to other networks external to the family. Interactions take place within the family among the members who also have interactions outside the family. So there are several edges proceed from one node of a family towards nodes within the family and nodes outside the family. The edges within a family show intimate relationship, whereas the edges connecting nodes outside the family do not necessarily show intimate relationship. This intimate relationship is a very important assumption that we have to consider so as to reduce the number of states of the social network. For example, the likelihood of a family member to conform to the family norms will be higher. Similarly, the likelihood of a person to side with a close friend will be higher. Also, the likelihood of a member of a particular group to conform to group norms will be higher. These assumptions are necessary to measure the probability of how the whole network behaves in a certain way.Interaction takes place along the nodes. The connection of one node to the other is either direct or indirect. For example, a person’s friend is connected to the person directly; the person’s friend’s friend is connected to the person indirectly, separated by one friend or technically by one degree. Research (Stanley Milgram, 1967) shows that every person in the world is separated only by six degrees to any other person. This implies that every person is connected directly or indirectly with other persons in the network except for an isolated community whose members do not have any contact with outside world. The six degrees of separation is only an approximation. For example, if you know the targeted person then the degrees of separation is zero. If your friend knows the targeted person then the degrees of separation is one and so on. Milgram’s conclusion was if you have selected a person to be targeted at random, then the maximum degrees of separation would have been six. However, the number of degrees of separation depends upon the number of critical nodes in the network in question. We will discuss about critical nodes later. So, connectivity is more or less a social reality. The question is whether this connectivity can be used as a tool to study social phenomena? If the answer is affirmative, then where can we apply this tool?If we analyse social structure in terms of a network system, then it may be useful to understand the nature of ‘dynamism’. The state of a system at the current moment is a function of the state of the system at the previous moment and some change between the two moments. Therefore, ‘a set of actually existing relations at a given moment’ depends upon the actually existed relations at the previous moment. It implies the importance of time interval, whatever the interval may be. That means if we want to know why a particular type of social structure prevails over a society at a given point in time, then we should necessarily bring ‘historical perspective’ to the study. Change is an important ingredient of dynamic system. A change at the micro level sometimes doesn’t affect the system. But, in other occasions the system becomes chaotic. It depends upon the nature of change in time and space. What is to be noted here is, a person’s behaviour is shaped by the person’s past experiences and the present situation.Moreover, a person in a social network is connected to different smaller networks which are dispersed widely. After all, a social network is networks within networks. But we should note that the system behaves differently with respect to a particular behaviour of different persons; it depends upon who the person is and how the person is placed in the hierarchy of the network. The network landscape is not even; it contains persons with different status and position. A person moves vertically and horizontally as well as deletes and adds connections. This brings change frequently at the micro level of the network. A person who is in power can easily influence others to follow an idea which need not be correct and a person who is not in power may not be able to influence others though the idea may be correct and good for the society. An idea doesn’t arise in a vacuum; it comes from the mind of a person. Even if an idea is correct, sometimes our society takes a lot of time to accept it. For example, it took a lot of time for our people to accept the fact that the earth is revolving around the sun and not the other way.In a social network, (1) each node is unique as two individuals can’t be treated as two similar objects; (2) a node may have a large number of edges connected to it directly or indirectly though it may not influence the behaviour of other nodes; (3) a node may not have a large number of edges connected to it directly or indirectly, yet it may influence the behaviour of other nodes in its network; (4) a node may have both larger connectivity and the power of influence over other nodes. So it is necessary that each node is to be studied and graded according to its connectivity and power of influence. Once this is done, we will be able to predict, to some extent, how a particular network would behave. A critical node is a node that has a larger connectivity as well as the power of influence. Why people took a lot of time to accept that the earth is revolving around the sun and not the other way: It was because the critical nodes might not have been immediately ready to accept the fact for certain reasons; secondly, each node is required to be connected with at least one critical node in order to get influenced quickly; finally, a node was in confusion because it might have been connected to two critical nodes which had opposite views.Though network is a good analogy to explain the concept of social structure, it has certain limitations: (1) The states of a network increases exponentially as the number of nodes increases; (2) The number of states of each node and its dependency on other nodes can’t be fixed as it can be done in Boolean network; (3) The number of edges (social relationships) increases as the number of nodes increases by a formula nc2; (4) Edges do not have uniform relationship; (5) Each node is unique and continues to change; (6) Information of opposing values continues to flow in the edges on both directions.Though the number of relationships increases significantly as the number of nodes increases in a social network, it does not increase the complexity of the network. Society has certain norms. People are expected to follow these norms. These norms regulate the behaviour of people. Social regulations tend to reduce the noise in the network.Though the behaviour of a node in the social network is difficult to determine, we can measure it by applying the theory of probability. For example, a family may hold a particular value. As the family is a closely knit group, all the members are expected to hold the same value. If we attribute a colour to this particular value, then the nodes of the family network will have the same colour and will look distinct. When the information pertaining to this value flows out from the family network to other networks through the edges, the information will have this colour. Therefore, the other nodes which receive and value this information will be influenced by this colour. Similarly, the nodes of a family will also be influenced by other colours as different information flow into the family network. The colour of a node depends upon how strong the node holds a particular value. Suppose, a certain node is surrounded by several nodes of a distinct colour, then the probability that this particular node will have a strong influence of that particular colour is higher. This is what happens when a person joins a group; the person will be strongly influenced by the values of that group. And when this person interacts with other nodes, those group values are transmitted. Therefore, if we know (a) the network of a particular node, (b) the colour of other nodes in the network, and (c) the colours of the critical nodes in the network, then we will be able to determine the probable behaviour of the particular node by giving weighted measure to each node of the network according to its location, distance, and colour. Though the nodes in a social network are not objects, the nodes can be studied objectively in this manner with a probabilistic determination.Suppose a node is a drug addict and living in the neighbourhood of other nodes who are drug users and sellers, then we have reasons to believe that the node’s addiction is due to its location and easy availability. But we can’t attribute the same reason to a node’s addiction to drugs if the node doesn’t live in the neighbourhood of drug users and sellers. The circumstances under which the two nodes have got addicted to drugs would be different. There may be many causes for a node to become a drug addict. However, network analysis with probabilistic determination will be useful to find out the significant cause. In the former case, the node should be treated leniently because the probability to become a drug addict is higher due to its location and easy availability. The node is prone to be a victim of circumstances. The circumstances could be due to retreatism, a concept developed by the sociologist Robert Merton (1968).According to Merton, retreatism is a response to inability to succeed; it is the rejection of both cultural goals and means, so that, in effect, one drops out. The sale of illegal drugs itself is another kind of deviant behaviour which Merton defined as innovation. Innovation involves accepting the cultural goals but rejecting conventional means. This excessive deviance results from particular social arrangements. Whereas in the latter case, the node’s probability to get addicted to drugs is lower and the circumstances are not obvious. It could be a personal choice or the drug sellers’ spread to new locations. If it was a personal choice, then in addition to social arrangements, biological and psychological factors would also be considered to find the causes. In this case, the node’s deviant behaviour needs a different treatment.The above example illustrates how a social phenomenon can be studied using a network analysis with probabilistic determination. The probability of a node’s behaviour will guide us to make social predictions such as how a particular neighbourhood will behave in a certain situation at a given moment of time. One problem which would arise in this model is how the nodes are coloured. Suitable research method is to be employed to arrive at the probable nature of a node. The probable nature of a node depends upon the probable nature of other nodes in the network. The researcher should proceed from the established and known nature of certain nodes. For example if a group’s values are overtly known to everyone then the group will be coloured accordingly. However, the researcher should note that if the nodes are wrongly coloured, the measures will be wrong and so our predictions.Another problem is the dynamic nature of the system. The behaviour of a node is constantly changing. However, the change in a particular node does not bring about a change in the system immediately in most of the cases. The change in the system is felt only after reaching a tipping point. Social change does not take place every second. After all, a period of 1,000 years is just a blink of an eye in the biological evolutionary time scale. Hence, social predictions can be made at a given moment of time. A third problem is, there can be individual differences within a family or group. This fact is to be considered in the research method before colouring a node.To sum up, we are living in this information society with lots of complex problems. This is not surprising because it is natural and an outcome of evolutionary process. Many problems do not have a single cause. Taking a decision looking at one cause of a complex problem will lead us to face another problem in different form. We will have to look at all causes simultaneously to see how the riddle unfolds itself. It implies there are many solutions for a complex problem. Probabilistic determination might give us the best possible solution.
jackpotslotsweb.infospinslotwins.infoslotbidwins.infofantasyslots.infobestslotmachine.infocasinoslotonline.infojackpotslotwins.infojasabacklinkpro.infojasabacklinks.infoseosites.infolinkseo.infoslotmachinetips.infoslotmachinestrategies.infoslotmachineodds.infoprogressiveslotwins.infojyufnehnd.inforqqbgnd.infohhxyygznd.infolrhvand.infoylcalnd.infouqlnhnd.inforesrhnd.infopsdrvnd.infopabrsnd.infomtayand.infolirensmnd.infokekepnd.infohgnffnd.infokratombz.infomenody.infoauryadbe.infosongmide.infolandecz.infoeventvde.infoitrolde.infoorgivde.infofestbg.infoyzkstcom.infogdzbzcom.infoneuqncom.infoozmuzcom.infofudggcom.infoqzykwcom.infolyympcom.infodnenycom.infohqaaecom.infogpzslcom.infoaaehlcom.infobxtjzcom.infontpocom.infoeppomcom.infoemaeocom.infofbsvncom.infoezamzcom.infofghoacom.infodzypjcom.infodsfdbcom.infoebifmcom.infoisurinet.infonusuonet.infobceluk.infosnjabcom.infoOlgato.infomsmmycom.infoomdircom.infoVilato.infoegoltcom.inforrdeocom.infoAllyto.infomcsdpcom.infoweigbcom.infobwmovcom.infoqyhlnet.inforedcanet.infoimwapnet.infowbtgwcom.infosoyhocom.infomxjxlcom.infogmlatcom.infoldstxcom.infoxjwxxcom.infogpabocom.inforeofkcom.infozayhdcom.infosxbbdcom.infoszyeqcom.infoycjyccom.infocccfhcom.infoSweeto.infonzeamcom.infomycsdnet.infoTraxto.infovvhento.infopnfzwcom.infoyygjbcom.infosrywjcom.infonxtypcom.infoshrjdnet.infozaylccom.infoxjnspcom.infohznjqcom.infoqpcswnet.infotwtmtcom.infomdouwcom.infoielpzcom.infofjpancom.infoabdezcom.infoMoonug.infozgnavcom.infoplknycom.infoasbtlcom.infokumchnet.infonioomcom.infoigutrcom.infomepncom.infostixto.infobbponcom.infodrupccom.infozujarnet.infootocscom.infohrpubnet.infosabpccom.infontfckcom.infoMinito.infoagpclcom.infoapkpzcom.infoLunarto.infolielnet.infoblunxcom.infouekkocom.infovwgemcom.infosvelto.infosbicbcom.infobdysmcom.infoealelcom.infoqdonynet.infofcsadnet.infochnrxcom.infojomopcom.infozbmhwcom.infoaqdficom.infohfzeucom.inforjjilcom.infoocszzcom.infotauhpcom.infoehbnecom.infoememenet.infootrocom.infongoiccom.infosekuycom.infoceolucom.infocdklkcom.infoehwelcom.infobassjcom.infourlrlcom.infopppwccom.infoydavscom.infouandunet.infoqhtcmcom.inforghdccom.infoptcsdcom.infozgggbnet.infobmkfycom.infoldickcom.infocwkshcom.infoyxjkdcom.infozmgmbcom.infomqegocom.infoszytgnet.infomkoorcom.infoiutahnet.infoditflcom.infocolqrcom.infosjboxnet.infogxcxwcom.infohyhajcom.infoiharzcom.infojcacscom.infomilicnet.infomsmmocom.infoiktvscom.infodixlecom.infoymfabcom.infolfpetnet.infomedphnet.infonabxnet.infocxfzcom.infoazttscom.infosjielcom.infofkxlbcom.infomuzoknet.infogjainnet.infosorkinet.infopugrccom.infoSacAdnet.infoylnzhcom.infolggokcom.infoticeonet.infovvhatto.info

Finance, Credit, Investments – Economical Categories

Scientific works in the theories of finances and credit, according to the specification of the research object, are characterized to be many-sided and many-leveled.

The definition of totality of the economical relations formed in the process of formation, distribution and usage of finances, as money sources is widely spread. For example, in “the general theory of finances” there are two definitions of finances:

1) “…Finances reflect economical relations, formation of the funds of money sources, in the process of distribution and redistribution of national receipts according to the distribution and usage”. This definition is given relatively to the conditions of Capitalism, when cash-commodity relations gain universal character;

2) “Finances represent the formation of centralized ad decentralized money sources, economical relations relatively with the distribution and usage, which serve for fulfillment of the state functions and obligations and also provision of the conditions of the widened further production”. This definition is brought without showing the environment of its action. We share partly such explanation of finances and think expedient to make some specification.

First, finances overcome the bounds of distribution and redistribution service of the national income, though it is a basic foundation of finances. Also, formation and usage of the depreciation fund which is the part of financial domain, belongs not to the distribution and redistribution of the national income (of newly formed value during a year), but to the distribution of already developed value.

This latest first appears to be a part of value of main industrial funds, later it is moved to the cost price of a ready product (that is to the value too) and after its realization, and it is set the depression fund. Its source is taken into account before hand as a depression kind in the consistence of the ready products cost price.

Second, main goal of finances is much wider then “fulfillment of the state functions and obligations and provision of conditions for the widened further production”. Finances exist on the state level and also on the manufactures and branches’ level too, and in such conditions, when the most part of the manufactures are not state.

V. M. Rodionova has a different position about this subject: “real formation of the financial resources begins on the stage of distribution, when the value is realized and concrete economical forms of the realized value are separated from the consistence of the profit”. V. M. Rodionova makes an accent of finances, as distributing relations, when D. S. Moliakov underlines industrial foundation of finances. Though both of them give quite substantiate discussion of finances, as a system of formation, distribution and usage of the funds of money sources, that comes out of the following definition of the finances: “financial cash relations, which forms in the process of distribution and redistribution of the partial value of the national wealth and total social product, is related with the subjects of the economy and formation and usage of the state cash incomes and savings in the widened further production, in the material stimulation of the workers for satisfaction of the society social and other requests”.

In the manuals of the political economy we meet with the following definitions of finances:
“Finances of the socialistic state represent economical (cash) relations, with the help of which, in the way of planned distribution of the incomes and savings the funds of money sources of the state and socialistic manufactures are formed for guaranteeing the growth of the production, rising the material and cultural level of the people and for satisfying other general society requests”.
“The system of creation and usage of necessary funds of cash resources for guarantying socialistic widened further production represent exactly the finances of the socialistic society. And the totality of economical relations arisen between state, manufactures and organizations, branches, regions and separate citizen according to the movement of cash funds make financial relations”.
As we’ve seen, definitions of finances made by financiers and political economists do not differ greatly.
In every discussed position there are:

1) expression of essence and phenomenon in the definition of finances;

2) the definition of finances, as the system of the creation and usage of funds of cash sources on the level of phenomenon.

3) Distribution of finances as social product and the value of national income, definition of the distributions planned character, main goals of the economy and economical relations, for servicing of which it is used.

If refuse the preposition “socialistic” in the definition of finances, we may say, that it still keeps actuality. We meet with such traditional definitions of finances, without an adjective “socialistic”, in the modern economical literature. We may give such an elucidation: “finances represent cash resources of production and usage, also cash relations appeared in the process of distributing values of formed economical product and national wealth for formation and further production of the cash incomes and savings of the economical subjects and state, rewarding of the workers and satisfaction of the social requests”. in this elucidation of finances like D. S. Moliakov and V. M. Rodionov’s definitions, following the traditional inheritance, we meet with the widening of the financial foundation. They concern “distribution and redistribution of the value of created economical product, also the partial distribution of the value of national wealth”. This latest is very actual, relatively to the process of privatization and the transition to privacy and is periodically used in practice in different countries, for example, Great Britain and France.

“Finances – are cash sources, financial resources, their creation and movement, distribution and redistribution, usage, also economical relations, which are conditioned by intercalculations between the economical subjects, movement of cash sources, money circulation and usage”.
“Finances are the system of economical relations, which are connected with firm creation, distribution and usage of financial resources”.

We meet with absolutely innovational definitions of finances in Z. Body and R. Merton’s basis manuals. “Finance – it is the science about how the people lead spending `the deficit cash resources and incomes in the definite period of time. The financial decisions are characterized by the expenses and incomes which are 1) separated in time, and 2) as a rule, it is impossible to take them into account beforehand neither by those who get decisions nor any other person” . “Financial theory consists of numbers of the conceptions… which learns systematically the subjects of distribution of the cash resources relatively to the time factor; it also considers quantitative models, with the help of which the estimation, putting into practice and realization of the alternative variants of every financial decisions take place” .

These basic conceptions and quantitative models are used at every level of getting financial decisions, but in the latest definition of finances, we meet with the following doctrine of the financial foundation: main function of the finances is in the satisfaction of the people’s requests; the subjects of economical activities of any kind (firms, also state organs of every level) are directed towards fulfilling this basic function.

For the goals of our monograph, it is important to compare well-known definitions about finances, credit and investment, to decide how and how much it is possible to integrate the finances, investments and credit into the one total part.

Some researcher thing that credit is the consisting part of finances, if it is discussed from the position of essence and category. The other, more numerous group proves, that an economical category of credit exists parallel to the economical category of finances, by which it underlines impossibility of the credit’s existence in the consistence of finances.

N. K. Kuchukova underlined the independence of the category of credit and notes that it is only its “characteristic feature the turned movement of the value, which is not related with transmission of the loan opportunities together with the owners’ rights”.

N. D. Barkovski replies that functioning of money created an economical basis for apportioning finances and credit as an independent category and gave rise to the credit and financial relations. He noticed the Gnoseological roots of science in money and credit, as the science about finances has business with the research of such economical relations, which lean upon cash flow and credit.
Let’s discuss the most spread definitions of credit. in the modern publications credit appeared to be “luckier”, then finances. For example, we meet with the following definition of credit in the finance-economical dictionary: “credit is the loan in the form of cash and commodity with the conditions of returning, usually, by paying percent. Credit represents a form of movement of the loan capital and expresses economical relations between the creditor and borrower”.

This is the traditional definition of credit. In the earlier dictionary of the economy we read: “credit is the system of economical relations, which is formed while the transmission of cash and material means into the temporal usage, as a rule under the conditions of returning and paying percent”.
In the manual of the political economy published under reduction of V. A. Medvedev the following definition is given: “credit, as an economical category, expresses the created relations between the society, labour collective and workers during formation and usage of the loan funds, under the terms of paying present and returning, during transmission of sources for the temporal usage and accumulation”.

Credit is discussed in the following way in the earlier education-methodological manuals of political economy: “credit is the system of money relations, which is created in the process of using and mobilization of temporarily free cash means of the state budget, unions, manufactures, organizations and population. Credit has an objective character. It is used for providing widened further production of the state and other needs. Credit differs from finances by the returning character, while financing of manufactures and organizations by the state is fulfilled without this condition”.

We meet with the following definition if “the course of economy”: “credit is an economical category, which represents relations, while the separate industrial organizations or persons transmit money means to each-other for temporal usage under the conditions of returning. Creation of credit is conditioned by a historical process of fulfilling the economical and money relations, the form of which is the money relation”.

Following scientists give slightly different definitions of credit:
“Credit – is a loan in the form of money or commodity, which is given to the borrower by a creditor under the conditions of returning and paying the percentage rate by the borrower”.
Credit is giving the temporally free money sources or commodity as a debt for the defined terms by the price of fixed percentage. Thus, a credit is the loan in the form of money or commodity. In the process of this loan’s movement, a definite relations are formed between a creditor (the loan is given by a juridical of physical person, who gives certain cash as a debt) and the debtor.
Combining every definition named above, we come to an idea, that credit is giving money capital of commodity as a debt, for certain terms and material provision under the price of firm percentage rate. It expresses definite economical relations between the participants of the process of capital formation. Necessity of the credit relations is conditioned, from one side, by gathering solid quantity of temporarily free money sources, and from the second side, existence of requests of them.

Though, at the same time we must distinguish two resembling concepts: loan and credit. Loan is characterized by:

o Here, the discussion may touch upon transmission of money and also things form one side (loaner) to another (borrower): a)under the owning of the borrower and, at the same time, b) under the conditions of returning same amount or same quantity and quality of the things;

o The loaning of money may bear no interest;

o Any person may take part in it.
With the difference with loan, credit, which is somehow a private occasion of the loan, represents:

o One side (loaner) gives to the second one (borrower) only money, and _ for temporal usage;

o It may not bear no interest (if the assignment doesn’t foresee something);

o In it creditor is not any person, but a credit organization (at the first place, banks).
So, a credit is the bank credit. To our mind, it is not correct to use “credit” and “loan” as the synonyms.
Banking crediting is the union of relations between bank (as a creditor) and its borrower. These relations touch upon:

a) Giving a certain amount of money to the borrower for definite purpose (though, we meet with the so-called free credits, aims and objects of crediting are not appointed in the assignment);

b) Its opportune returning;

c) Getting percentage rate from the borrower for using the sources under his/her disposal.
The essential foundation of the credit essence and its important element is existence of trust between the two sides (in Latin “credo”, from which comes the word “credit”, means “trust”).
From the position of circulation of money forms (in the abstraction, historical process of formation economical relations and social budget and banking systems expressed by them) comparing different definitions of finances and credit, the paradox conclusion appears: credit is the private occasion of finances. And truly, from the position of movement of the money forms, finances represent the process of formation and usage of the funds of cash means. Very often such movements are fulfilled without returning, but sometimes, it is possible to give loans from the budget for the investment projects of other needs. Also, when a manufacture or corporations use their cash funds and we mean the finances of industrial subject, such usage may be realized as inside the manufacture or corporation (there is no subject about returning or not returning of the usage), so gratis under conditions of returning. This latest is called commercial form because of transmitting the sources to others, but even in this occasion, it is the element of financial system of the manufacture and corporation.

From the point of cash means movement, main character of credit is the process of formation and usage of the funds of cash means under the conditions of returning and, as a rule, taking the value-percentage. If gating the credit value doesn’t take place (even in the exceptional occasions), according to the movement form, credit becomes a private occasion of finances, as from the net financial funds (consequently from the state budget) the loans which bear no interests may be used. If gating credit value takes place, by the appearance form, credit is discussed to be financial modification.

From the historical point of view, finances (especially in the sort of the state budget) and credit (beginning with usury, later commercial and banking) were developing differently for considering credit to be the part of finances. Though, from the genetic-historical point of view, previous loaners, before giving loan, needed gathering the permanent capital not returning, that is the net financial foundation. The banks analogously needed concentration of the important own capital for influxing the consumers’ means and for getting higher percentage rate under the conditions of returning. Herewith, exactly on the financial basis, in the sort of financial fund (which later partially becomes loan fund) part of the bank capital appears to be the reservation (insurance) part of the fund, which by nature is financial and not loan. So notwithstanding the essential distinctions between finances and credit form the genetic-historical point of view, credit appears to be formed from finances and represent their modification.

From the essential position of expressing economical relations of finances and credit, we meet with cardinal distinctions between these two categories. Which mostly expressed by the distinction of the movement forms notwithstanding they are returnable or not. Finances express relations in the aspects of distribution and redistribution of social product and part of the national wealth. Credit expresses distribution of the appropriate value only in the section of percentage given for loan, while according to the loan itself, a only a temporal distribution of money sources takes place.
Herewith, there is a lot of common between the finances and credit as from the essential point of view, so according to the form of movement. At the same time, there is a significant distinction between finances and credit as in the essence, so in the form too. According to this, there must be a kind of generally economical category, which will consider finances and credit as a total unity, and in the bounds of this category itself, the separation of the specific essence of the finances and credit would take place.

Funding of the cash means is common to the researched economical categories. It takes place in any separate system of finances and credit, which have been touched upon during the analyses of defining finances and credit. Word combination “funding of the cash sources (fund formation)” reflects and defines exactly essence and form of economical category of more general character, those of finances and credit categories. Though in the in economical texts and practice, it is very uncomfortable to use a termini, which consists of three words. Also, “unloading” with an information hardens greatly its influxing into the circulation even in the conditions of its strict substantiation and thoroughness.
In the discussing context we consider:

1) wide and narrow understanding of economical category of the finances;

2) discussing finances in narrow understanding under general traditional meaning;

3) discussing finances, as funding of the cash means, in wide understanding, which concerns finances – in narrow meaning and credit – in complete meaning.
Termini “funding” and its equivalent “fund formation” are used by us as the purposeful structuring of cash means, which is based on two poles – accumulation of money sources (gathering) and its usage for definite purpose in the way of financing and crediting.
We have established a new termini – “finance-investment sphere” (FIS). Analyses about interrelation of finances and credit made by us give us an opportunity of proving, that in the given termini, the word “financial” is used with the meaning of funding cash sources, its purposeful structuring. In this process we consider at the same time financial, credit and investments’ economical categories.

Let’s sum up middle results of discussing new concept – “finance-investment sphere” and discuss its investment consisting parts.

The concept “investments” was brought into the native economical science from the West. In the Soviet economical science they for a long time used in the place “investments” the termini “capital placement”, which expressed the usage of the industrial factors in the sphere of real industrial activities during realization of capital projects. From one glance, this termini in its concept is identical to the “investments”, consequently it is possible to use them as synonyms. Though the termini “investments” and “investing” have the advantage towards the termini “capital placement” from linguistic and philological points of view, because they are expressed with one word. This is not only economical and comfortable in the process of working with the termini “investment” itself, but also it gives an opportunity of termini formation. More concretely: “investment process”, “investment domain”, “finance-investment sphere” – all these termini are much more acceptable.
Changing native economical termini with foreign ones is purposeful, if it really matters (by keeping parallel usage of the native termini for the inheritance). Though we must not change native economical termini into foreign ones all together, when by ordinal traditional language easy to explain private and narrow concrete processes and elements get their own termini. The “movement” of these termini is approved in the narrow professional bounds, but their “spitting out” into the economical science may turn economical language into the tangled slang.

Let’s discuss termini – “investment” and “capital placement’s” usage in the economical literature.
Investments are placement of funds into the main and circulation capital for the purpose of getting profit. “Investments in material assets – are the placements of funds into the mobile and real estate (land, buildings, furniture and so on). Investments in financial assets are the placements of funds into the securities bank accounts and other financial instruments”.

We don’t meet with the termini “investments” in the earlier economical dictionary, but we meet the combined termini “investment policy” – the union of the industrial decisions, which guarantee main directions of the capital investments, the activities of their concentration in the determinant suburbs, on which the reaching of planned rates of development of the society production is depended, balancing and effectiveness, getting more and more production and profit of the national income for every lost Ruble”. For today, in the most actual definitions, the capital investments are bounded only by financial means, when not only financial, but also the investment of natural, material-technical and informational resources takes place. Labour resources take an actual place in the investment process. They themselves fulfill this or that investment process.

A positive side of the discussed definitions is that they connect investment policy and capital placements (investments):

- economical development according to the key directions to the concentration;

- providing high rates of economical growth;

- raising an economical effectiveness, which is expressed:

a) by growing the throw off of the production and national income for every lost Ruble;

b) by fulfilling the branch structure of the investments;

c) by improving their technological structure;

d) by optimization of their further production structure.

Compared with such definition of the investments (capital placement) the definition of investments in the dictionary attaching the “Economics” seems to be unimproved: “investments – the expenses of gathering production and industrial means and increasing material reserve”. In this definition current expenses (production expenses) are mixed with the investment (capital) expense. Also, not the investment expenses but (though the investments are followed by the appropriate expenses) exactly advancing. It differs from the expenses by that the means (means) are put by returning the advanced values, also, under the conditions of growth, to which the concept-advanced capital is corresponding. the advancing may be realized in the money, natural-material and informational forms.

Except the termini “investments”, there are two more termini related with the investment. They are shown below.

“Human capital investment” – any activity provided for rising the workers labour productivity (in the way of growing their qualification and developing their abilities); at the expenses of improving the workers’ education, health and raising the mobility of the working forces”. It is very useful to use the mentioned termini, though it needs one correction: the human capital investments do not concern only workers, but also the servants, representatives of every kind of labour.
“Investment commodity, capital goods – a capital.”

In the official manuals of political economy of the reformation time the capital investments are discussed as “expenses for creating new main funds and widening, reconstruction and renewing the active ones”. In this definition the investments (capital placements) during separation of the forms (types) of further production of the main funds are bounded only by main funds (without increases of the circulation funds and insurance reserves):

a) creating new ones;

b) widening;

c) reconstruction;

d) renewing.

Also, the concept of the industrial gathering appears, at the expenses of widening of basic, circulation funds and also insurance reserves takes place”.

You’ll meet below the definitions of investments from “the course of economy”: the investments are called “placements of fund into the basic capital (basic means of production), reserves, also other economical objects and processes, which request long-termed influxing of material and cash means. “According to the division of capital into physical and money forms, the investments too must be divided into material and cash investments”.

They apportion investment commodity, to which belong industrial and nonindustrial building objects, vehicles purposed for changing or widened technical park and the furniture, increasing reserves and others.

“They call the total investments of production an investment product, which is directed towards keeping and increasing the basic capital (basic means) and reserve. Total investments consist of two parts. One of them is called the depreciation; it represents important investment resources for compensation of renewal till the level of before industrial usage, wearing out and repairing of the basic means. Second consisting part of the total investments is represented by net investments – capital investments for the purpose of increasing basic means”. Depreciation is not a compensation resource of wearing the basic funds out, but it is the purposeful financial source of such resources.
Human capital investment is “a specific kind of investments, mostly in education and health protection”.

“Real investments are the investments in the economical branches and also, they are kinds of economical activities, which provide influxing the increases of real capital, that is increasing material values of the industrial means”. We can agree with such definition with one specification that material and nonmaterial values too belong to the real capital (wealth), consequently science-researching experimental-construction results, various information, education of he workers and others. Such service as organization of the excitable games, also the service of redistribution social wealth from one private person to another (except charity).

“Financial investments represent placement of funds into the shares, obligations, promissory notes, other securities and instruments. Such investments, of course, do not give increases of the real material capital, but they help getting profit, consequently at the expenses of changing the course of the securities in the time of speculation, or distinguishing the course in different places of sell and purchasing”. We share wholly such definition, hence it follows that financial investments (if it is not followed by real investments as a result) do not increase real material wealth and real nonmaterial wealth. According to this context, the expression below is very important: “we must distinguish financial investments, which represent placement of the funds in the ways of selling and purchasing the securities for the purpose of getting profit and financial investments, which become cash and real, moved to real physical capital.”

In the “economical course” quoted before long and short-termed investments are separated. Recognizing the existence of the bounds between them, the authors ascribe short-termed investments to “one month or more” investments. If we get such conditioned criteria, that we can call the investments which overcome the terms of some months, long-termed ones, which is very doubtful and we don’t agree with it. A long-termed character of the fund placement is a significant feature of the investments (short-term doesn’t combine with the concept of investments). Principally, it would be better to point out quick compensative, middle termed compensative and long-termed compensative investments:

- less then 6 months – quick compensative;

- from 6 months up to the year and a half – middle termed compensative;

- more then the year and a half – long termed compensative.

We stopped at the definition of the investments in the capital work “economical course” for the special purpose, as, in it the author tried to discuss the concept of investments systemically and quite completely, herewith the book is published just now.

We’ll return to the discussion the definition economical category of “investments” in different publications in the following chapter. The definitions given here are quite enough for having a notion of the level of lighting up the given category in the economical literature.
What conclusions may be made according the definition of the mentioned economical category in the published works, except the made notions and specifications?

There is quite deeply, concretely and thoroughly defined the concept of “investments”, different definitions in the economical literature; but mostly in every works about the investments discussed by us until now, there is not opened the essence of investments as an economical category. In every monograph , even if it has a title investment, as an economical category , there is given only the definition, concept of investments. But, as the Academician Vasil Chantladze explains, “a concept is a discussion, which proves something about the distinguishing feature of the researched object. A concept out of much essential characteristic features represents only one, and essential in it is only – definition”.

But the categories are much wider; it is “a key, the most fundamental concept of every science”. Economical categories theoretically represent real, objectively existed productive relations. A category is the defining of occasions of existed characters, connections, relations of the objective world. Generally, any educational process is fulfilled by the categories, which give opportunities for dividing the processes and occasions semantically, for expressing the definitions of a subject and realize their specific peculiarities and economical relations of a material world.
Our goal is exactly to substantiate investments – as an economical category and also, as a financial category in the narrow understanding.

Here we apply for another manual thesis made by the academician Vasil Chantladze: “every financial relation is an economical one and every financial category is and economical one, but not every economical relation and economical category is financial relation and financial category”.
In the process of defining the investments, it is important to take in mind the sides of resources, expenses and incomes, because investment, from one side, is the result of the manufacture’s activity, and, from another one, – a part of income, which, in this case, is not used for usage.
Another occasion: it is advisable to discuss investments in two aspects: as a category of reserve and flow, which will reflect exactly the connection between “placement of funds” and “investments”.

What We Have Here Is A Failure To Communicate

The results of this past election proved once again that the Democrats had a golden opportunity to capitalize on the failings of the Trump Presidency but, fell short of a nation wide mandate. A mandate to seize the gauntlet of the progressive movement that Senator Sanders through down a little over four years ago. The opportunities were there from the very beginning even before this pandemic struck. In their failing to educate the public of the consequences of continued Congressional gridlock, conservatism, and what National Economic Reform’s Ten Articles of Confederation would do led to the results that are playing out today.. More Congressional gridlock, more conservatism and more suffering of millions of Americans are the direct consequences of the Democrats failure to communicate and educate the public. Educate the public that a progressive agenda is necessary to pull the United States out of this Pandemic, and restore this nations health and vitality.

It was the DNC’s intent in this election to only focus on the Trump Administration. They failed to grasp the urgency of the times. They also failed to communicate with the public about the dire conditions millions have been and still are facing even before the Pandemic. The billions of dollars funneled into campaign coffers should have been used to educate the voting public that creating a unified coalition would bring sweeping reforms that are so desperately needed. The reality of what transpired in a year and a half of political campaigning those billions of dollars only created more animosity and division polarizing one extreme over another.

One can remember back in 1992 Ross Perot used his own funds to go on national TV to educate the public on the dire ramifications of not addressing our national debt. That same approach should have been used during this election cycle. By using the medium of television to communicate and educate the public is the most effective way in communicating and educating the public. Had the Biden campaign and the DNC used their resources in this way the results we ae seeing today would have not created the potential for more gridlock in our government. The opportunity was there to educate the public of safety protocols during the siege of this pandemic and how National Economic Reform’s Ten Articles of Confederation provides the necessary progressive reforms that will propel the United States out of the abyss of debt and restore our economy. Restoring our economy so that every American will have the means and the availability of financial and economic security.

The failure of the Democratic party since 2016 has been recruiting a Presidential Candidate who many felt was questionable and more conservative signals that the results of today has not met with the desired results the Democratic party wanted. Then again? By not fully communicating and not educating the public on the merits of a unified progressive platform has left the United States transfixed in our greatest divides since the Civil War. This writers support of Senator Bernie Sanders is well documented. Since 2015 he has laid the groundwork for progressive reforms. He also has the foundations on which these reforms can deliver the goods as they say. But, what did the DNC do, they purposely went out of their way to engineer a candidate who was more in tune with the status-quo of the DNC. They failed to communicate to the public in educating all of us on the ways our lives would be better served with a progressive agenda that was the benchmark of Senators Sanders Presidential campaign and his Our Revolution movement. And this is way there is still really no progress in creating a less toxic environment in Washington and around the country.