Money is an interesting aspect to life. When asked what money is, most would suggest that it is a thing, and point to their wallet or the paper money in their hand. This is true for any civilization; we all have different forms of money but it all serves the same purpose. And it always has the same aspect that few people succeed in realizing. Money is not a thing, but rather a concept. We use it to value objects of desire in a clear, algorithmic way. And who dictates money always serves as quite an unpredictable variable.
Before being introduced for the first time to these fundamental ideas, I fell in the pit with all of the other conformists. I looked down at Jackson’s face and thought, ‘I have money right here’. That thought now lies in contention with some of the greater lies I have told myself. Milton Friedman wrote an essay entitled “The Island of Stone Money” which details a small Micronesian island in which the indigenous people use large limestone rocks as their currency. He explains that the stones can be used to purchase things despite not having to actually be transported due to their immense and inconvenient size. While this seems illogical at first, Friedman is able to draw parallels with the United States government during the Great Depression, citing that they conducted a very similar move sanctioning off gold for the French merely by labeling it (Friedman 2-4). He proved that all monetary systems are in essence the same, despite some seeming less logical on the surface.
Today, we suffer from an even more illogical economic strategy, that being online banking. We are all told we earn money and that money is placed in a bank account, but nobody ever sees it. Chana Joffe-Walt explains that the money we earned is not necessarily real, as it is never physically held, just told it exists. Furthermore, in our society today, there is an unbelievable reliance on online banking and transactions. Though the money we pay on Amazon is coming from “our” bank account, what does that truly mean? Is it our money? Or is it just a promise that we’re able to trade and negotiate with at our own will?
Bitcoin deserves a notable mention here, as it gained popularity recently and is already notorious for being a worthless investment. The idea behind Bitcoin is to provide an anonymous, easy method to transfer funds. They present themselves, them being Bitcoin, as a concept, not a currency. This being said, there is no true value to them; they have no backing in the real, physical world (Reeves). Since they advertise themselves as failing to have a tangible value, they are in a sense making themselves vulnerable to an unstable worth. People see them as being not real, unlike paper money, such as USD, which they think is, and people do not value them as much. The concept of money, in this sense, is a curse as it maintains that currency must have a physical “value” in order for the lie that is money to work.
To some extent, money is a real thing with real value. But practically speaking, it functions as a system through a series of lies and promises that may or may not be true. Your money in your bank account may have been dropped in the Atlantic Ocean, but it is still your money, and you can still withdraw it from your account.
Friedman, Milton. “The Island of Stone Money.” Diss. Hoover Institution, Stanford University , 1991.
Joffe-Walt, Chana . “How Fake Money Saved Brazil.” NPR.org. 4 Oct. 2010. 7 Sep. 2015. <http://www.npr.org/blogs/money/2010/10/04/130329523/how-fake-money-saved-brazil>.
Reeves, Jeff. “Bitcoin Has No Place in Your – or Any – Portfolio.” MarketWatch. Livefyre, 31 Jan. 2015. Web. 07 Sept. 2015.
Glass, Ira . “The Invention of Money.” NPR.org. 4 Oct. 2010. 7 Sep. 2015. <http://www.thisamericanlife.org/radio-archives/episode/423/the-invention-of-money?act=0#play