Stone Money- Themrpublicdisplayname

Posted on September 7, 2015 by Public Display Name

The idea of a currency is extremely complicated, and this could be attributed to the fact that money, the basic building block of a currency, is also an extremely complicated subject. Up to this point, and mostly due to my lack of interest to study more into the subject, I believed in the gold standard. The gold standard was the system in which the US backed all of its money by gold. This meant that in theory a dollar bill could be exchanged for its worth in gold. To my amazement I learned through the NPR broadcast about money that the gold standard was abolished in the 1930s and that our economy, and most economies, are simply not backed by anything other then the fact that it is agreed that they have a value. Also mentioned in the aforementioned broadcast was a group of people that had an economy system based off of smoothed disks on sandstone. This actually makes more sense then the US economy as it is very concrete; you see the stones, you know who the stones belong to, you know how they can be exchanged. However this system parallels the US system when told the story of a large stone that, on its way to this island, had to be dropped at sea (Friedman). Those that had went to retrieve the stone described the stone in such detail that their fellow island-dwellers all agreed that the stone would be put into circulation (Friedman). An object that could not be seen could be traded around for goods and services. This sounds very much like the banking system of the US; we cannot see the money, we see the numbers and with that we purchase goods and services. In a way the ocean was almost like a bank for the people of the island.

The bitcoin is a newer attempt at a new economy with the main draw being that it is entirely through the internet. New of course being relative. This kind of currency makes sense to me as it is traded over the internet and can be exchanged for a price of your regional equivalence. A lot of people are against this new(er) “cryptocurrency” (Reeves). One reason being that it fluctuates in price (Reeves). These fluctuations can be small to massive (13 dollars to 1,150) and have no rhyme or reason (Reeves). This currency system, however, does fit the common mold of currencies previously discussed. Additionally, that is a lot of criticism for a relatively new system of currency. As the bitcoin stabilizes, many are hopeful that the bitcoin might actually be a viable currency for more then online purchases. It is usable now, however it is extremely niche and not many know how to use them (Phillips). As the technological age is upon use, it is not a total shot in the dark in saying that making the bitcoin more accessible to everyone, and therefore more stable, could happen.

Economies are crazy. Attempting to change to a cryptocurrency, however is also crazy. However in a world where money is simple numbers, it is a rather feasible venture. My thinking about money has gone from a dated view of the “gold standard”, to a much greater understanding about how money works, and how the internet can help us create a streamline international economy.

Works Cited

Friedman, Milton. “The Island of Stone Money.” (1991): n. pag. The Hoover Institution, Stanford University, Feb. 1991. Web. 7 Sept. 2015.

“The Invention of Money.” This American Life. NPR.org, 7 Jan. 2011. Web. 07 Sept. 2015.

Phillips, John. “Bitcoin: What to Expect in 2015.” CNBC. N.p., 15 Dec. 2014. Web. 07 Sept. 2015.

“Bitcoin Has No Place in Your – or Any – Portfolio.” MarketWatch. N.p., 31 Jan. 2015. Web. 07 Sept. 2015.

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4 Responses to Stone Money- Themrpublicdisplayname

  1. Public Display Name says:
    September 11, 2015 at 8:20 am

    Feedback was requested.

    Feedback provided.
    —DSH

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  2. Public Display Name says:
    September 18, 2015 at 9:17 am

    The idea of the bitcoin is wild; it is a currency entirely through the internet. This is a currency that we cannot touch, in comparison to the united states dollar, which yes does have an element we cannot touch with the banking system, but also has dollars and cents that are very real. To put this into perspective lets say you own a diamond. A very nice and shiny diamond of whatever size your heart desires. Now say we put an invisible cloak over the diamond and we can never remove the cloak, but the diamond can still be traded, and even more like the bitcoin, the diamonds price will fluctuate (because the price of all goods, especially precious stones and metals, will never stay the same). However, unlike the invisible diamond, the price of the bitcoin fluctuates extremely wildly (Reeves), this could be due to the fact that this is, once again, that the idea of the bitcoin is in the bitcoins infancy. Another issue with the bitcoin is that it is very niche, not many know how to use it, or even what it is. Hopes remain high that bitcoins will become more accessible to the everyday internet user.

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  3. davidbdale says:
    September 21, 2015 at 12:51 pm

    Hey, PDN, I realize it’s late in the game to be giving you feedback, just a day before your rewrite is due. Feel free to take your time on the revisions if what I say here encourages you to considerable work; HOWEVER, please publish a new post by the deadline with your best revisions, THEN take your time to improve it in subsequent edits. I promise I’ll grade yours late to give you time to make it the best you can.

    P1. With your permission, I’d like to offer a radically different version of your first paragraph that, by example, will demonstrate more than I can begin to describe in the same number of words.

    I was stunned to learn from a recent NPR broadcast that the gold standard was abolished in the 1930s, and that our dollars are backed by nothing more than a communal faith in their value. The same broadcast told of the Yap, whose currency are huge shiny disks of limestone quarried and polished 400 miles away and brought to the limestone-free island of Yap as rare tokens of wealth called fei. Of the two systems, the Yaps’ was more comforting: their fei were rarer than dollars, couldn’t be counterfeited, and could be parked outside one’s house to prove the household’s wealth.

    But in another way, the fei were just as abstract as our dollars. When a particularly fine fei was lost at sea before anyone on Yap had seen it, the Yap accepted the description of its value, and its owner—who had never “possessed” it—was enriched by it regardless. Not so different from that fei are the dollars in our bank accounts: invisible quantities of intangible entities that can be spent for very real goods and services

    Very little is lost in this radical editing, TPD, except the presence of TPD. It’s fine to indicate that you have experienced a change of perspective on money, but money is the topic, not your attitude. I hope the example make that clear, and also demonstrates the method for incorporating essential background information BRIEFLY, not as the primary information conveyed, but as support for your own premises.

    P2. Even more unlikely, I’m going to repeat that modeling technique again for P2, TPD. Who knows? This may be the only way I can help you.

    Bitcoin is unapologetically even more abstract than dollars. This new virtual currency never exists in physical form and does not pretend to be “backed” by anything other than its acceptability to some vendors as a reasonable exchange for goods and services. Its novelty and its small user base subject its value to wild fluctuations, but as more people accept it, more people trust it; and if that trend continues, Bitcoin could achieve legitimacy as an international currency without the support of any nation: a true economic novelty.

    It seems to me this is what you meant to say.

    P3. What the heck. Here’s your third paragraph, Hodgesized:

    To a culture weaning itself from gold coins to dollars, bitcoin would have seemed insane, but we’re already so accustomed to swiping cards and “checking our balances” online, that we’d probably be instantly comfortable with any cryptocurrency that amazon, ebay, and PayPal endorsed. After all, if we can use it to “pay our bills,” who cares what money looks like, or whether we can see it at all?

    I resist this technique whenever I can, TPD, but here it was the most economical way to explain what I is I hope you will accomplish with your writing. I apologize—after teasing you with it—that you’re not permitted to use it as your rewrite. I hope you’ll be able to use it as a model. It’s brief but clear, uses the source material to good purpose, and makes the premises—instead of your reactions to them—the subject matter.

    Please reply with your reactions to this type of feedback.

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  4. Public Display Name says:
    September 21, 2015 at 6:10 pm

    Thank you very much for the feedback, my rewrite will done today. I like this kind of feedback as it gives me a basis to back my rewrite on.

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