I have always felt that money was somewhat of a nebulous concept; during the process of my research on the Yap and their stone money system, some of my thoughts were confirmed. Each society has a different currency and a different monetary system. But are they all really that different?
The Yap use limestone disks, called fei, as currency. The bigger the disk, the wealthier the owner. If the disk was too big to move, it stayed in the same spot on the island. Yet they still acknowledged that it changed hands. They were content with the idea that the money now belonged to someone else. This baffles me. My initial thought was to wonder how they trusted one another with this currency system; after all, it was just someone’s word against another’s. It also made me think about our own currency system. We tend to take it for granted, but really how are we so different from the Yap? We give value to little green pieces of paper, but what is backing them up? We see numbers on our computer screens representing the worth of our bank accounts, but is the money actually there? We satisfy ourselves with the thought that our money can be used to pay bills, buy groceries, fill our gas tanks. But where is this money actually coming from? The bank doesn’t have it. We don’t have it. Is it really just a myth?
Brazil’s monetary situation got so bad that 4 graduate students had to come up with a fake currency just to stabilize the economy. Inflation caused prices to rise each day; people were in poverty. But with this new “currency” called the real, they could trick people into thinking prices weren’t changing. Everything was still bought using the actual currency, the cruzeiro. What changed each day was how many cruzeiros a real was worth. But by pricing everything in reals, the people felt that they had a stable pricing system to work with and thus stopped the wide-spread panic. And eventually it did stabilize the economy. The inflation rate decreased rapidly, and the poverty-stricken population were able to make ends meet. Japan is also attempting to end their national debt crisis by printing new money and creating more jobs.
Reading these stories really makes me think. It brings up a lot of questions about how our economy works. What does the national debt really mean? Why is college so expensive? Why does it take years to pay off a house or a car? Why do we need to pay so much money for healthcare? If Brazil can trick people into believing that the economy was changing, surely we can come up with a clever solution to our own money issues. It seems to be the same world wide.
What I’ve come to realize through this research is that money has imaginary value. We place value on it, but have no real way to back up that claim. We put all of our trust in pieces of paper and numbers on a screen. I started out thinking that the Yap system of fei was illogical and old-fashioned. But in reality, how are we any different? Money holds only the value that we give to it. And I can’t help but think that we could be doing a much better job. Each country’s problem is unique, but stems from the same issue. We put too much trust in the value of money.
Joffe-Walt, Chana. “How Fake Money Saved Brazil.” NPR.org. 4 Oct. 2010. 30 Jan. 2015.
Krugman, Paul. “The Curious Case of Japan’s Economic Stimulus.” truth-out.org. 22 Jan. 2013.