What is Money?
What is money?
A place to start in understanding money is going back into the past and examining what has served as money over the centuries.
Here is a list of some of the objects that have served as money:
* paper -- identical (mostly identical) pieces of paper, that are fairly rare (bills)
* metal -- identical stampings of pieces of rare metals (coins)
* cigarettes -- single or in packs
* snail shells -- of approximately the same size, shape, color and quality
* beads -- identical beads that were generally rare
* grain -- a certain mass/weight, rather than per seed
* salt -- a certain mass/weight
* pepper -- in the corn or kernel state
* standard sized bags of dried mackerel fish (in US prisons)
* nails -- of the same size and quality
* rare teeth, feathers, bones (skulls)
* oxen, pigs, sheep, chickens, people (slaves), etc.
As O'Hara points out, in order for these objects to become money, several things had to be true:
* Desirable
* Portable -- easy to move in large amounts - or easy to "prove" or access the info
* Durable -- it should not wear out or become difficult to distinguish as time passes
* Homogeneous -- if it is a commodity, then the actual material value of one unit should be very close to another of the same unit
* Divisible -- if it is a commodity, then it should be possible to cut a high value one in half, and each half should be worth 1/2 as much as the original
* Stable Value -- from one moment to the next, it should not change much in value
* Cognizable -- easy to see or tell or know that it is the money and not counterfeit or something else
An interesting question is: With a credit-based money, which of these still have to apply for it to make a "good" money?
In the future, what else could be money? Cubes of coal? Vials of oil?
Wikipedia Articles on Money
History of Money, Commodity Money, Money Creation
Credit Money, Credit, Creditor, Debt, Debtor
Additional Reading
http://www.indiastudychannel.com/resources/48850-Origin-Functions-Nature-Evolution-Classification-Money.aspx
"The money material should possess stability of value in order that it may serve as a standard of deferred payment. It is important for the debtor to know how much value he is to return at the end of a year or five years, and this is not possible where there is not some standard of value which remains fairly constant."
http://chestofbooks.com/finance/economics/Intro/114-Qualities-Of-A-Good-Money-Material.html
A place to start in understanding money is going back into the past and examining what has served as money over the centuries.
Here is a list of some of the objects that have served as money:
* paper -- identical (mostly identical) pieces of paper, that are fairly rare (bills)
* metal -- identical stampings of pieces of rare metals (coins)
* cigarettes -- single or in packs
* snail shells -- of approximately the same size, shape, color and quality
* beads -- identical beads that were generally rare
* grain -- a certain mass/weight, rather than per seed
* salt -- a certain mass/weight
* pepper -- in the corn or kernel state
* standard sized bags of dried mackerel fish (in US prisons)
* nails -- of the same size and quality
* rare teeth, feathers, bones (skulls)
* oxen, pigs, sheep, chickens, people (slaves), etc.
As O'Hara points out, in order for these objects to become money, several things had to be true:
* Desirable
* Portable -- easy to move in large amounts - or easy to "prove" or access the info
* Durable -- it should not wear out or become difficult to distinguish as time passes
* Homogeneous -- if it is a commodity, then the actual material value of one unit should be very close to another of the same unit
* Divisible -- if it is a commodity, then it should be possible to cut a high value one in half, and each half should be worth 1/2 as much as the original
* Stable Value -- from one moment to the next, it should not change much in value
* Cognizable -- easy to see or tell or know that it is the money and not counterfeit or something else
An interesting question is: With a credit-based money, which of these still have to apply for it to make a "good" money?
In the future, what else could be money? Cubes of coal? Vials of oil?
Wikipedia Articles on Money
History of Money, Commodity Money, Money Creation
Credit Money, Credit, Creditor, Debt, Debtor
Additional Reading
http://www.indiastudychannel.com/resources/48850-Origin-Functions-Nature-Evolution-Classification-Money.aspx
"The money material should possess stability of value in order that it may serve as a standard of deferred payment. It is important for the debtor to know how much value he is to return at the end of a year or five years, and this is not possible where there is not some standard of value which remains fairly constant."
http://chestofbooks.com/finance/economics/Intro/114-Qualities-Of-A-Good-Money-Material.html