HOW DOES MONEY REALLY WORK?

The Real Question Should Be: Is Money Working For You Or Against You?

That would depend on which side of the fence you are standing. And to answer that question to the best of your ability, we’ll have to ask:

What Is Money?

Webster’s Dictionary defines money as something generally accepted as a medium of exchange, a measure of value, or a means of payment. Hmmm. That’s a little vague.

Going back in time, people of the world used bartering instead of money. This is nothing more than to trade by exchanging one commodity for another. Traders would meet at the marketplace and after some haggling back and forth, an agreement would be reached of exactly how much of commodity “A” would be exchanged for commodity “B”.

That leads us to ask: What is a commodity? Simply an economic good. What’s that? Early forms of commodities were food: both produce and livestock. In fact, the term pecuniary is defined as pertaining to money. And this word is derived from the Latin pucinia, which means cow.

Later, metals became a commodity during the Bronze Age. Iron, copper and bronze was all traded along trade routes between merchants. Metals were easier to have a value assigned to them because value was determined by weight. In fact, weight measurements were stamped on smaller pieces, effectively creating the first coins. The benefits of the metals vs. other commodities were their ability to be measure exactly and not being perishable. Of course, the metal most associated as money throughout history is gold. Why has gold over time been the universal money? That’s a whole another debate left to the sociologists of the world to fight over. For our reasons, it is important to know it has been.

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This entry was posted on Friday, May 2nd, 2008 at 11:54 am and is filed under Hot Topic, Interest Cancellation, Money Merge Account, Mortgage Acceleration, United 1st Financial. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.