Coins and Paper Money

So what does that mean today? For Rome burned and Nero fiddled – Aztecs have come and gone, same with ancient Greece, Persia, Egypt and England Once highly developed societies that had money and have come and gone as “rulers of the world”, what does this all mean to ME In America Today ?

Money is just a way to trade our effort (WHE.- Work Hour Equivalents ) for what we need or want. Barter is just not realistic for our complicated lives. So what is a good object to trade? Fish, beads, salt maybe? But as soon as some wiseguy finds a pile of one of these, he will be rich and not done any work and he will not be the last to do it. Valuation goes in the tank.(counterfeiting)

So how about a coin? Made of metal especially precious metal because it is hard to make or find more of it or counterfeit to dilute it’s value. But who makes this “Money”? If a independent business does, each merchant must trust the weight or weigh each piece, so transactions would be very local. Who knows if the private mint of “Far Away Land” is trustworthy?

How many people need to transact further away from “Local”? I don’t know this but just a thought?

On the other hand if a government mints the coinage or “money” it can legislate that it must be accepted, and in truth most citizens want to believe that the government will be honest and fair. But someone must play for this effort.

As Long as the merchants and citizens have faith or trust the value of the money it has value.

So….. why not get rid of the burden of coinage and use paper money????

Well, it still has to have the faith of the merchants and citizens. When I trade my WHE for a coin or paper money I want a fair trade. So when I trade for what I want or need, I want to know my WHE inside of that “money” are well spent. So "Money" is just a storage device for WHE’s, therefore it can be of anything agreed upon. Who would agree upon age device that reduces my WHE’s once it goes into the device? Still the device does not matter as long as it does the job.

But can you use lemons? I say not - yield on a lemon tree has zero correlation to WHE’s and if it was to be made so; everyone would have a lemon tree and some would find a way to have a huge harvest.

What about a promise from your local community bank they are nice people right? They can store the correct WHE’s and then debit the account upon a purchase or spending . If our story ends here, Yes! That would work. So private “money” issuance or banking still works; if the government will allow it.

If “money” gains value over time, very few people would spend it, because it would be worth more tomorrow. On the other hand in it looses value over time, you want to spend it yesterday; because it will be worth less tomorrow. In Nirvanastan (the idyllic kingdom) “money” is neutral in value and does not change, So you can store your WHE’s or spend them, depending on your values not the increase or decrease of the trading medium.

Currently in the good old USA, our money is loosing value, due to reasons addressed later. Therefore it makes the most sense is to spend that money NOW, here we have a simple reason for our consumption driven economy.

Just to buck the “conventional wisdom”, what if we spend our WHE’s right away, but not on consumables but on a investment or move that “money” back through our world, without owning it?

But can we continue to spend as our “Money” looses value? Is there an end to this road? Can changing what is used as “money” change this or have any effect at all?