What is money? Where does our money come from?

[new_trader]

aye, it all boils down to that simple truth in the end. For it to work the transactors do, of course, need to have continuing faith, confidence, trust (call it what you will) in whatever money token they are using.

That is incorrect Jon. The only 'money' that requires faith is fiduciary money which is usually created by Governments. All other money has been chosen by the market because it has intrinsic value, mostly because of utility but also because of it's desirability and wide usage.

Almost everyone in the developed world has a mobile phone and perhaps the most popular is the iPhone. So, can the iPhone be money? Sure. Why? Because it doesn't require you to trust the person giving it to you. You already know it has utility and you know that there is a high likelihood that you can use it yourself or that you exchange it for something else.

 

[new_trader]

Oh, good god, what a calamity of a thread this has become...

And I'm sure you will rescue it by telling everyone that money is what the Government says it is.

 

[darktone]

Oh, good god, what a calamity of a thread this has become...

How so? because the the guys that are good with words befuddle fact?

 

[barjon]

That is incorrect Jon. The only 'money' that requires faith is fiduciary money which is usually created by Governments. All other money has been chosen by the market because it has intrinsic value, mostly because of utility but also because of it's desirability and wide usage.

Almost everyone in the developed world has a mobile phone and perhaps the most popular is the iPhone. So, can the iPhone be money? Sure. Why? Because it doesn't require you to trust the person giving it to you. You already know it has utility and you know that there is a high likelihood that you can use it yourself or that you exchange it for something else.

Oh blimey, you do make it complicated for me, NT I'm only a simple guy.

Can't see that money has any intrinsic value in the way I understand the term. And if it does, how do you measure it? By some form of agreed standard points system I suppose - isn't that what money is in the first place?

So on that basis the intrinsic value of £10 is, er, £10 - well that's got us a long way then

 

[darktone]

Tangibility is not relative, what are you talking about? Either something exists or it doesn’t.

No, I don’t accept Government Sterling because of trust; I am forced to accept Government Sterling because of legal tender laws.

How do you exchange an intangible idea? If you have a ‘thing’ that is tangible then it has nothing to do with trust because someone can SEE what you have. Have you ever walked into a store and tried to buy something with an idea? Try it and tell me how you get on.

I think you have got yourself confused somewhere.

lol, yes your right, i was confused. My use of the word tangible was completely wrong.

 

[darktone]

money is just a convenient way for the masses (ie multiple transactors) to Value and exchange Assets or services

N

I think thats what money should be, and all it should be. ATM, because of the way its created it isnt though :|

 

[new_trader]

Oh blimey, you do make it complicated for me, NT I'm only a simple guy.

Can't see that money has any intrinsic value in the way I understand the term. And if it does, how do you measure it? By some form of agreed standard points system I suppose - isn't that what money is in the first place?

So on that basis the intrinsic value of £10 is, er, £10 - well that's got us a long way then

No Jon

All fiat money (except the Euro) in use today had at one point in history been defined by a certain weight of a commodity, and the commodities happened to be gold and silver. Those commodities came from the market and were once THE medium of exchange because they embodied all the qualities of money ie/ Scarcity, wide usage, recognition, durability, utility, divisibility.

Go back far enough in time and almost all money was specie made from the commodity gold and silver so it required no trust or promises to pay the bearer on demand because the coin itself was the commodity. The founding fathers of the US knew this and that is why they wrote in their constitiution:

Section 10. No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

 

[barjon]

I think thats what money should be, and all it should be. ATM, because of the way its created it isnt though :|

I think it is, darktone, but the creation can leave transactors with a false impression of its "worth".

 

[new_trader]

I'm banging my head against a brick wall

 

[darktone]

I think it is, darktone, but the creation can leave transactors with a false impression of its "worth".

Yes!!!. I think that is the number one point! Unfortunately im not doing a very good job at getting it across i think.

 

[new_trader]

Yes!!!. I think that is the number one point! Unfortunately im not doing a very good job at getting it across i think.

That is because despite my efforts to inform you that value can only come from the market through a process of exchange over a long period of time you still seem insist that someone can arbitrarily create value out of thin air.

Anyway, all this banging has made my head hurt...

 

[darktone]

Yes!!!. I think that is the number one point! Unfortunately im not doing a very good job at getting it across i think.

In fact is go further and say that is where i see the injustice of it all. The majority have little idea as to changability of the buying power of their money. The whole point of me starting this thread is to try and promote awarness of the subject.
But it gets bogged down in opinion and word play. But theres nowt i can do about that eh.

 

[darktone]

That is because despite my efforts to inform you that value can only come from the market through a process of exchange over a long period of time you still seem insist that someone can arbitrarily create value out of thin air.

Anyway, all this banging has made my head hurt...

NT, i think its we just have different opinions on what money is and if it should have any 'value' per say.
What a repulsive subject.

 

[Martinghoul]

And I'm sure you will rescue it by telling everyone that money is what the Government says it is.

Not at all... However, I can't help noticing that you keep repeating the same old and tired arguments that we have already discussed. As far as I am concerned, you have failed to defend your opinion adequately on the older thread where we discussed this. Here you just keep saying the same thing all over again, which really doesn't make it any more convincing. Furthermore, you're missing a fundamental, blindingly obvious reason for why money should be, in fact, what the Govt says it is, whether that is gold, seashells, peanuts or paper.

 

[new_trader]

Not at all... However, I can't help noticing that you keep repeating the same old and tired arguments that we have already discussed. As far as I am concerned, you have failed to defend your opinion adequately on the older thread where we discussed this. Here you just keep saying the same thing all over again, which really doesn't make it any more convincing. Furthermore, you're missing a fundamental, blindingly obvious reason for why money should be, in fact, what the Govt says it is, whether that is gold, seashells, peanuts or paper.

Tired old arguments ... I can't change history can I?

 

[new_trader]

NT, i think its we just have different opinions on what money is and if it should have any 'value' per say.
What a repulsive subject.

Mine isn't an opinion.

 

[darktone]

Mine isn't an opinion.

Only in your opinion!

 

[new_trader]

Only in your opinion!

Well then start saving seashells, peanuts or whatever else in your opinion is money...perhaps Martinghoul can help you with some ideas... as for me and my opinion, I am storing my savings in gold and silver.

 

[Martinghoul]

Tired old arguments ... I can't change history can I?

No, but what you offer has nothing to do with history? And when I say "history", I am referring to "historical facts". What you offer is your particular interpretation of history, which is neither accurate nor particularly insightful. Moreover, your conclusions fly in the face of some very basic facts of life, which is something you choose to ignore.

 

[new_trader]

No, but what you offer has nothing to do with history? And when I say "history", I am referring to "historical facts". What you offer is your particular interpretation of history, which is neither accurate nor particularly insightful. Moreover, your conclusions fly in the face of some very basic facts of life, which is something you choose to ignore.

And you offer nothing but Establishment propaganda...and there we have it.