Stone Money- Justheretopass

The Difficult Understanding of Money 

Most people’s goal in life is to be financially stable to the point where they don’t have to stress about certain things. How does one become financially stable though; Money is always the answer. Money dictates a lot of things in our life. For example how we are educated, how healthy we are, and the overall quality of living. We all strive to obtain an abundance of this paper or virtual paper we call money. The value of money can go up or down depending on the country you’re in and the period you’re in. If you think about it, money is just paper or random numbers to let us know how good or bad we are doing in life. Society has established a certain amount of money on each paper to differentiate them. The idea of money keeps people waking up every morning and chasing their dreams and to one day be financially stable. 

In The Island of Stone Money by Milton Friedman, he talked about how people on the island of Yap use stone money as a form of currency. The author talked about how when they make trades they will usually keep the stone untouched at the former owner’s land even though he doesn’t own it anymore. Having money is an idea and mindset as shown by the people of Yap because even though they don’t physically have the stone with them they have the stone in their name and head. This process is similar to the United States process when they started to move from gold to paper. Over time, people got tired of holding the heavy pieces of gold so the banks took the gold and exchanged it for paper money which we use today. 

In NPR’s podcast, The Invention of Money by Ira Glass discussed the 2008 financial crisis with Jacob Goldstein who is the author of Money: The True Story of a Made-Up Thing. Jacob asked his aunt who is a very successful businesswoman what happened to all the money that just vanished. His aunt stated that “money is fiction.” The money never really existed in the market like they said it did. All the houses used to be worth a certain amount but plummeted which is the reason why all the money was lost. All the houses just lost their original value. Essentially no money was lost during this financial crisis the money was just devalued. 

To look deeper into the idea of money being an idea and fictional we can look at The Lie That Saved Brazil by Chana Joffe-Walt. The Brazilian government tricked 150,000,000 into believing their money had value, when in reality it didn’t. Brazil had a problem with inflation due to the president wanting to build a massive city in the middle of the jungle. The government didn’t have the money to build that city so they just printed more and created more money from nothing. As each year passed with them building the city, the money in Brazil became more worthless by the day. A beer manufacturer stopped making beer during this saying, “making beer just takes too long. You buy all the wheat and the hops and by the time it was brewed everything was worth so much less.” The money in Brazil was losing its value as soon as they got it like a car right when you drive it off the lot. This shows you money is fictional because even if you get a $100 bill that bill might not be worth $100 in an hour. The value might decrease to $98 but it’s still the same bill. 

As I was reading the article regarding the Bitcoin, E currency it was interesting to see how fast something could drop so fast. On Wednesday the price of bitcoin was at a high $266, but then on Friday, it dropped to $54. In three days the price of bitcoin dropped $212. This goes to show you how unrealistic money is, and that is just the idea of a person. No one would have been able to predict the drop of bitcoin to plummet that far down because no one knows how much the world has. On the contrary, having electronic money may be good to save space and make it lightweight but it is definitely easier to steal your money earned. In 2014, Mt.Gox hackers were able to make off with bitcoins that were worth roughly $460 million dollars. 

Money isn’t always in the form of paper or coins. It can be in the form of a virtual presence called e currency. Jacob Goldstein stated that, “the most money he has or gets paid is usually direct deposit.” He never actually physically touches the amount of money he makes every pay cycle. When you pay bills online money never changes hands. The numbers on the computer will just change on your screen. You just see numbers from the other side of the screen. For example, bitcoin is a very popular virtual currency that is made from complex computer coding. It can be accessed virtually by anyone on the computer. You never really see your bitcoin money unless the user wants to cash out. The 21st century is heavily influenced by technology and how to make our lives easier. This way of money is starting to become the new norm in society.

To think about the concept of money is very complex and difficult to get a full understanding of it. Money has changed in so many ways throughout history from when it was first invented to now. The idea of the money went from having heavy coins, to having printed paper, to replace the coins – to now having virtual money and credit cards and people rarely seeing their physical amount of money. We could see inflation starting to rise due to the fact of the growth of the economy and how fast it is moving with e-currency on the rise. The amount of money will keep going up and down as the economy continues to move, putting a whole spin on if money is real or fiction.

References  

Friedman, M. (1991, February). The Island of Stone Money. https://counterintuitive2015.files.wordpress.com/2015/01/stonemoneyessay.pdf.

Glass , I., & Joffe-Walt , C. (2018, February 19). The Invention of Money. This American Life. https://www.thisamericanlife.org/423/the-invention-of-money.

Park, H. Money’s Role in Society. Money’s Role in Our Society. http://scripts.cac.psu.edu/users/h/w/hwp5131/Assignment%205.html.

Reeves, J. (2015, January 31). Opinion: Bitcoin has no place in your – or any – portfolio. MarketWatch. https://www.marketwatch.com/story/bitcoin-has-no-place-in-any-portfolio-2015-01-28.

Renaut, A. (2013, April 13). The bubble bursts on e-currency Bitcoin. Yahoo! News. https://sg.news.yahoo.com/bubble-bursts-e-currency-bitcoin-064913387–finance.html.

What is MONEY? Jacob GOLDSTEIN’S book Explains ‘SHARED FICTION’. (2020, September 8). https://www.npr.org/2020/09/08/910586930/what-is-money-jacob-goldsteins-book-explains-shared-fiction. 

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10 Responses to Stone Money- Justheretopass

  1. davidbdale says:

    Paragraph 1. Most people’s goal in life is to be financially stable

    Introductions to complex subjects are difficult, JustHere, but every paragraph needs ONE MAIN IDEA, no matter how many ideas you’ll be discussing in the essay. Here you try to cover a bunch:
    —Money provides financial stability and success
    —Humans devote their lives to amassing as much money as they can
    —Currency depends on location and the local economy
    —Money’s value fluctuates
    —It’s pretty arbitrary
    —Every economy establishes an arbitrary and flexible value to its currency
    —How much we have determines our success in life
    —The desire to achieve success drives us, and since it’s largely determined by how much money we have, acquiring money is a primary motivator.

    You start and end with the same basic premise, that money drives us. That stuff in the middle about the arbitrary and flexible nature of money is pretty distracting right now. Emphasize one or the other. Save the rest for another paragraph if the content demands TWO MAIN IDEAS.

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  2. davidbdale says:

    Paragraph 2. In The Island of Stone Money by Milton Friedman,

    Readers don’t care as much about what “Milton Friedman talked about” as you might think. They do care, though, or you can make them care, that the people of Yap use HUGE STONE DISKS THE SIZE OF A VOLKSWAGEN as a form of currency, so cumbersome, in fact, that they leave the money where it lies when they make transactions instead of bothering to move it.

    I see here why you want to introduce the idea of awarding value to bits of paper in your introduction. Notice the shift in this paragraph from your first MAIN IDEA, that money drives our daily actions, to the ARBITRARY NATURE OF ASSIGNING VALUE TO CURRENCY. Maybe THAT’s the true MAIN IDEA your Introduction should focus on. You trace the move from heavy metal to paper here in this paragraph. It seems like a thread worth emphasizing.

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  3. davidbdale says:

    Paragraph 3. In NPR’s podcast, The Invention of Money

    by Ira Glass discussed the 2008 financial crisis with Jacob Goldstein who is the author of Money: The True Story of a Made-Up Thing.

    I see the value of identifying your “speakers” and the publication that is your source, but your ACTUAL SOURCE is Jacob Goldstein’s aunt. We don’t need to know about Ira Glass. We might not need to know about Goldstein or his aunt in particular. We could probably live with having here identified as a financial expert whose opinion was expressed on “The Invention of Money.”

    You do a nice job of explaining that the “money” wasn’t there (because it’s not a pile of dollar bills), but you’ll confuse readers if you tell them the money was “devalued.” If anything, money was MUCH MORE VALUABLE (relatively) AFTER the financial crisis. My $500,000 AFTER the crash could buy the same house that would have cost me $2Million BEFORE the crash. Right? Houses were devalued. Stocks lost their value. Portfolios became worthless. But CASH, if you had it, was suddenly VERY valuable.

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  4. davidbdale says:

    Paragraph 4. To look deeper into the idea of money being an idea

    —”the idea of money being an idea”?
    —This is an interesting paragraph, but you promise to explain that the Brazilian government tricked the country into believing its money had value when it didn’t. You then spend the entire paragraph describing the reason they got into their mess but not how they got out of it.
    —You sort of undermine your point too by concluding that all money can be de-valued. In your paragraph, the cruzeiro is not replaced by the fictional “real.” Instead, you describe the fictional value of the original cruzeiro (and virtually all currency).
    —I do admire the inclusion of the “beer-making” story. It’s a very good illustration of the corrosive effect of inflation.

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  5. davidbdale says:

    Paragraph 5. As I was reading the article regarding the Bitcoin,

    You might be interested to know that last week a single Bitcoin was valued at about $45,000. So that volatility can work BOTH ways. Those financial advisors who declared “Bitcoin has no place in your—or anyone’s—portfolio” are kicking themselves in the ass today.

    Liked by 1 person

  6. davidbdale says:

    Paragraph 6. Money isn’t always in the form of paper or coins.

    Bitcoin is a very good example of a virtual currency, but it’s not a good example of the sort of ordinary automatic deposit payroll practice Goldstein’s employers use. He’s likely still being paid in dollars. YES it’s digital, NO it’s not virtual. Most of what you say here about money’s abstraction is correct, but abstraction is not what makes Bitcoin a virtual currency. Bitcoin’s ultimate departure from the standard rules of currency is that it’s issued by some anonymous source not associated with any government. It’s not backed by a country. It takes is value SOLELY from its participants’ belief that it will find takers willing to part with goods and services for it.

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  7. davidbdale says:

    Paragraph 7. To think about the concept of money is very complex

    to now having virtual money and credit cards and people rarely seeing their physical amount of money

    Here again, you want to distinguish between digital and virtual transactions. So far, there are no Bitcoin-based credit cards. Credit transactions are still conducted in recognized currencies like dollars.

    We could see inflation starting to rise due to the fact of the growth of the economy and how fast it is moving with e-currency on the rise.

    Fast-moving economies aren’t necessarily inflationary. SPENDING way too fast by the government that prints the money can certainly cause inflation, as it did in Brazil. Maybe that’s where you picked up the idea. Inflation occurs any time demand exceeds supply, producers can charge more, and buyers are willing to spend more.

    The amount of money will keep going up and down as the economy continues to move, putting a whole spin on if money is real or fiction.

    You should be answering, not asking, questions at the end of your essay, JustHere. Here, I think your point is that the VALUE of, say, dollars will continue to rise and fall (as it does every time inflation or deflation affects how many pizzas $100 will buy).

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  8. davidbdale says:

    I’ve graded your assignment at Canvas, JustHere. If you’re satisfied with the grade, do nothing. If you’d like to revise for a better grade, make significant improvements to your post and place it into the Regrade Please category.

    Whichever you choose, responding to your professor’s feedback is not only polite, it’s the best way to assure that he continues to take an interest in your development as a writer. Any response is good. “Thanks, professor,” and “I have further questions,” and “What the hell was that!” are popular choices.

    If you’d prefer to be ignored, leave no response at all. 🙂

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  9. justheretopass says:

    Thank you professor for giving me this feedback.

    Like

    • davidbdale says:

      You’re welcome, JustHere. Is it advice you’ll use to revise your post, do you think? If so, you can update the text as much as you want for one week, then put it into the Regrade Please category.

      Like

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