What Is Money?

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donOld
What Is Money?

Money affects the quality of both our individual lives and the collective society in which we live more than any other single factor, yet very few of us ever bother to seriously ask or consider what money actually is. Despite its tremendous importance, we are taught very little about its true nature either in school, the workplace, the church, the mainstream media or from the government. This silence is not only deafening, it is highly destructive in that it leaves us vulnerable and at the mercy of those who do understand how to manipulate money to their own advantage. So share what you know about money here, so that we all can learn a little bit more about the true nature of this mysterious stranger.

I'll go first with this ...all money, even government currency, is initially created as debt. This is reflected in our double-entry accounting system of assets and liabilities. As all debts bear interest, all money bears interest. In other words, all of the money in existence is rented, and someone somewhere in the marketplace is paying the interest that is required to keep it all in existence.

Only about 3% of what people use as money is actual currency, originally created by the government. The other 97% is either other paper currency (like cheques, money orders, etc.) or electronic transfers of digital credits between financial institutions.

 

Fidel

Bankers and other creditors create money as interest owing debt.  Marx referred to their money commodity as "imaginary" and a "void" form of capital because it's based on fictitious claims for payment. Finance capital is not based on production but bonds, consumer and commercial mortgages, bank loans and other claims on the means of production. It is a fictitious claim on the future output side of things and not tangible assets produced.

“The">http://tinyurl.com/2a4o6jo]“The capital of the national debt appears as a minus, and interest-bearing capital generally is the mother of all crazy forms …” ... The insanity of it all, explains Marx, is that "instead of explaining the self-expansion out of the exploitation of labour power, the matter is reversed and the productivity of labour power itself is the mystic thing, interest-bearing capital."

And Marx goes on to describe how this was a favoured practice in the 17th century but was brought back into vogue in his time by vulgar economists and German statisticians.

Michael Hudson wrote:
[url=http://michael-hudson.com/2010/07/from-marx-to-goldman-sachs-the-fiction... capital[/url] sees any flow of revenue as economic prey – industrial profit, tax revenue, and disposable personal income over and above basic needs. The result is not unlike the “primitive accumulation” by armed conquest – land rent paid initially to warrior aristocracies. And much as the tribute taken by the military victors is limited only by the defeated population’s ability to produce an economic surplus, so the accrual of interest on savings and bank loans is constrained only by the ability of borrowers to pay the mounting interest charges on these debts. 

The problem is that the financial system, like military victors from Assyria and Rome in antiquity down to those of today, destroys the host economy’s ability to pay.

Jacob Richter

Money is more than a means of exchange.  It is *the* means of accumulating capital, for capital is money being used to purchase classical commodities (not "commodities" in the limited sense today), labour included, the final product of which is then resold for more money.

Socred

"Money is any medium which has reached such a degree of acceptablility that, no matter what it is made of,and no matter why people want it, no one will refuse it in exchange for his product." (Professor Walker)

Bec.De.Corbin Bec.De.Corbin's picture

What Is Money?

You can give all the fancy answers you want but in the end it's the stuff most of us here don't seem to ever have enough of...

absentia

Money is a way of assigning an artificial and arbitrary value to material, time ande energy. It's a way of quantifying without qualifying the productivity of a society; of commodifying all human interaction. Among honest people, it would work very well, but wouldn't be needed. Among people who need the accounting that money facilitates, it works very badly.  

scrotout

Money is God. We worship it, we would give our lives for it. It determines our lot in life.

Uncle John

Your loving gives me such a thrill

But your loving doesnt pay my bills...