When looking back, when I first heard Stone Money in class, I was completely dumbfounded by the country of Yap. To understand who they are, they were a small country in the Pasicific Ocean. Here the Islanders had these stone coins that could of been over 12 feet tall. These were not used for everyday buying power, they were made for special occasions. One example that you hear about in the story invention of money is “They used to use these to buy dead bodies of warriors. This is when you would offer the stone coin.” The most counterintuitive part about this was, when they made the deal, they would never get this stone. It was too big to move. They just told everyone who it was and that was it. The owner may never see it but they know that the stone coin was theirs.
Now that you have some backstory about what Stone money is about, you may think this is insane. Now take a second and think about our economy. Each dollar amount is worth a certain amount of gold. We keep this locked in a vault at fort Knox. No one ever thinks about it but we never see it.
Then when you think about the country of Yap, doest it sound familiar? The only difference with them was that they never had this fake thing like a dolar made up. We get checks from your job every week or two. There is no money ever being transferred. You go home, you cash the check and look at it in your bank account. Then you go and buy something from a store such as walmart. You use your debit card and those fictional numbers lower and get added to someone else’s account, where the same process repeats and repeats. There is no such thing as a dollar bill, we just came up with the idea of it.
When you listen to the lie that saved Brazil, by Chana Joffe-Waly, you find out how brazilians could not grasp the idea of money and inflation. Each month, you find out that the thing you sold to your friend last month for $10 was now only worth about $5. This completely shocked me because if something like this happened in the US people would lose their minds. Many of our lives revolve around making money. What would happen to our values, if whatever you did last week is worth less than half what you thought it did. Confusing? I know, It took me days of reading to actually grasp the idea of what was actually going on.
To try and fix this situation, the government of Brazil tried many things. One of the things they did was hold all of the citizens’ money. When this happened, many people committed sucide. I wanted to say this because, what would we do if we couldn’t touch our money from the banks. I know all chaos would break loose among us. Peoples entire life revolve around it, and in my opinion it is a made up object.
The whole reason why this situation was because of four drinking buddies. The solution that they came up with was tricking the people that the money had value again. They did this by printing a new currency. This followed the rules of economics, they would not be printing anymore. The only way this could work was if the people believed it had value. This was a completely made up currency just to save the country.
Money is a very marteritic and numeral thing. Our country alone is over 14 trillion dollars in debt. When you look at that your jaw may drop but you need to understand that there will never be that much money every made. I will lay it out you would need to spend one million dollars a year for 14 million years. No matter where you look money makes the world go round. People work their lives away 9 hours a day to get it. Without it we have nothing, and with too much of it you hold too much power. In reality money we use is made up, but that is all we know.
Friedman, M. The Island of Stone Money. Stanford, CA: Hoover Institution, Stanford University.
“The Invention of Money.” 423: The Invention of Money. This Is American Life, WBEZ. Chicago 2011