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a_general_history_of_money_and_banking [2013/07/05 09:05]
nsddev created
a_general_history_of_money_and_banking [2018/07/29 01:22] (current)
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 So we invent an exchangeable token - call it a dollar - and all of us in our community decide that a dollar is worth 1 tonne of potatoes, and it's worth one 5 meter by 5 meter hut, and it's worth 3 2-meter long tuna fish (a favorite food source of ours), and it's worth 100 square meters of farming land. It is also worth 100 of hut-cleaning and/or child-minding service. Indeed we denominate the dollar'​s worth in whatever commodities and services interest us, and vice versa we, as a community or as individuals reaching mutual agreement, can agree give a dollar value for any goods and services that interest us. So we invent an exchangeable token - call it a dollar - and all of us in our community decide that a dollar is worth 1 tonne of potatoes, and it's worth one 5 meter by 5 meter hut, and it's worth 3 2-meter long tuna fish (a favorite food source of ours), and it's worth 100 square meters of farming land. It is also worth 100 of hut-cleaning and/or child-minding service. Indeed we denominate the dollar'​s worth in whatever commodities and services interest us, and vice versa we, as a community or as individuals reaching mutual agreement, can agree give a dollar value for any goods and services that interest us.
  
-So that we can keep control of the issuance and transmission of tokens, we authorize an overseeing body. We'll call it a government - a body of people whose decisions and actions are given legitimacy by the consent of the community ​of whose behalf that government operates. They issue metal and paper tokens (and later, on-screen numbers that represent those tokens), and they punish anyone other than themselves who creates or copies (counterfeits) these money-tokens.+So that we can keep control of the issuance and transmission of tokens, we authorize an overseeing body. We'll call it a government - a body of people whose decisions and actions are given legitimacy by the consent of the community ​on whose behalf that government operates. They issue metal and paper tokens (and later, on-screen numbers that represent those tokens), and they punish anyone other than themselves who creates or copies (counterfeits) these money-tokens.
  
 The value of the dollar tokens changes from time to time, as people decide they love huts more than potatoes, and potatoes more than tuna, and so on, but a central exchange is set up so that people know (officially,​ at any rate) what a dollar token is worth in terms of huts, potatoes, tuna, cleaning services, and so on. The value of the dollar tokens changes from time to time, as people decide they love huts more than potatoes, and potatoes more than tuna, and so on, but a central exchange is set up so that people know (officially,​ at any rate) what a dollar token is worth in terms of huts, potatoes, tuna, cleaning services, and so on.

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