What is money?

Have you ever seen a coin made entirely of blank, unmarked metal? All coins start like this, but at some point most coins are stamped or marked by the king, emperor or country. When stamped, these metal discs suddenly become money

What happened here? The value of metal coins has little to do with the metal value of the coin itself - it is well known that it takes about 2 pennies to make one penny in the US, but by adding numbers to it, the government corrects the price worth it . This system is just the reason the money the government is saying is worth, it is called legal tender currency. Today, our money, such as gold, salt and tobacco, is useless on its own. These kinds of currencies consist of convenient items called commodity currencies that have been used in the past, but almost all of our money is useless today.

We agree to use it and give it monetary value by treating it as worthwhile. Otherwise, it is only metal, paper, numbers on the page. As long as everyone plays, money is deemed worthwhile and can be used regularly to buy and sell objects. That's why you can say that a $ 100 invoice is worth $ 100. In other words, the value of Fiat money is mainly derived from our trust in the institution that issues and maintains it. As this trust collapses, the money quickly loses its value so the result can be dramatic - this (very bad) process is called hyper inflation

But coins and bills are a kind of money. When you think about how much you have, you may also calculate the savings you deposit in the bank. If you own them, you can even look at the financial assets you own as stocks or bonds.

As you can imagine, what is counted as money and what is not? This is a difficult problem and economists have proposed multiple currency definitions of various contents. Because the physical currency accounts for surprising total funds supply, this is very important when trying to understand how to make money.

What is money? Money is speech. Money is a value store, it is account unit. If you ask the ten people on the street how much money you have - you may get 10 different answers. If you ask lawyers, you will get more subtle answers than economists. As an economist calls "exchange medium", the law association declares "public government currency". Why are there plans to sell health insurance and landscaping by turning over the hamburger when only colored paper is available? When people believe in their collective imagination, they think that they are willing to do these things. Trust is a raw material for casting all kinds of currencies

What is money? Currency is widely used and accepted in transactions involving the transfer of goods and services from one person to another. Economists distinguish between three currencies: product currency, legal currency and bank currency. A product currency is a product whose value is the value of money. Gold coins are an example of the product currency. In most countries, the product currency has been replaced by the statutory currency. Fiat 's money is well, its value is lower than the monetary value it represents. Dollar banknotes are examples of fixed money because the value as printed paper is lower than the value as currency. Bank funds include credits for books provided by banks to depositors. Transactions using bank deposits checks include the use of bank funds

Currently, most modern currency systems are based on the Fiat currency. However, in the majority of history, most of the money was gold coins and silver coins. As the economy develops, the product currency will eventually be replaced with a representative currency like gold standard. Because traders feel that actual transportation of gold and silver is troublesome. Fiat's currency has been gradually taken over the past 100 years, especially since the collapse of the Bretton Woods system in the early 1970s. Many items such as natural rare precious metals, shell shells, barley, beads, etc. have been used as the currency of goods, but also many other things considered valuable. The value of the product currency is obtained from the product it produces. The goods themselves constitute currency and the currency is goods