At a young age I was told money could buy you happiness. After all, as a child who would get whatever I desired, I began to believe it was true. No matter how I felt at the moment, whether I was filled with frustration or sorrow, whenever money was given to me my face would light up. This belief that money could buy happiness stuck with me until I saw people who were much happier without the materialistic things money could buy and also when I noticed that money in certain areas of the world didn’t hold value.
In Milton Friedman’s essay, Island of Stone Money, he talks about the small island of Yap and how he was impressed with their monetary system that revolved around stone. I found an immediate contrast between American society and Yap society, as Americans hold gold with much more value than stones would ever have. Unlike American society, Yap society holds stone with the same value as we Americans hold gold, which is why stone or as the Yap people may call it “Fei” is the currency of the island. As I continued to read the essay, I found it interesting that “it is not necessary for its owner to reduce it to possession.” Meaning if the stone could not be carried, the ownership would be switched, marked as a form of exchange and left undisturbed. I was surprised to know how easy it was for the people of Yap to trust someone with their stone but I noticed that it isn’t any different than me putting my “money” into a bank account.
As I continued on with my readings, I didn’t understand how Americans have allowed money to cause so many economic issues and control us. Then I remembered the time I believed money could buy happiness. In the article, “How Fake Money Saved Brazil”, the people in Brazil believed that “people have to be tricked into thinking money will hold its value”. In this article, four economists trick the people of Brazil into saving the country from inflation by slowing down the the creation of the Brazilian currency and developing a new currency called the “real”. The catch to the real was that this currency could not be carried like the people of Yap could not carry the Fei because of its weight but because it wasn’t real. It didn’t involve coins or bills because it never existed. Although the real wasn’t physical, it was virtual and was involved with anything that had real currency. The trick behind this new, fake currency is that people would think prices weren’t going up because it was listed as something different. This demonstrates how people control the value of money and can continue to control the value of money because money itself is fiction.
The belief that money can buy happiness is fiction. The idea that money can hold value is fiction. In various articles, the value of money is whatever we allow ourselves to believe it is. For instance, the Yap use stones to determine their wealth and how much they have. Also, the people of Brazil allowed four economists trick them into thinking prices weren’t going up and that they were saving more money. Money is nothing but an idea, that can involve value and trust. Most importantly, money is what we allow it to be.
Friedman, Milton. “The Island of Stone Money.” The Island of Stone Money (1991): 1-5. Print.
Joffe-Walt, C. (2010, October 4). How Fake Money Saved Brazil. Retrieved from http://www.npr.org/sections/money/2010/10/04/130329523/how-fake-money-saved-brazil
“The Invention of Money.” This American Life. N.p., 7 Jan. 2011. Web. 7 Sept. 2015. <http://www.thisamericanlife.org/radio-archives/episode/423/the-invention-of-money>