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MONEY 101

Money 101 is an introductory, college-level mini-course designed to help students understand what money is, what it was, and what it will be in the future.

What is Money?

What is currency?
What is cryptocurrency?

What was Money?

What was money a hundred years ago? A thousand years ago?

What will be money?

What will be money in the future? Will Bitcoin or another crypto-currency be money?

Overview

 

Money is anything that takes work to produce.

 

Historically, money was gold or silver (hard commodities) or wheat or barley (soft commodities). 

Because it takes work to produce money, energy is directly correlated to the production of money (gold, silver, wheat, barley).

More energy equals more money.

 

Historically, farmers and miners controlled the money supply.

A bumper crop of wheat would increase the money supply if farmers allowed their produce to hit the market all at once.

Likewise, a new discovery of gold would increase the money supply if miners allowed their product to hit the market all at once.

As market participants, farmers and miners controlled the money supply.

In a true market economy, market participants control the money supply.

 

Today, in contrast, government-appointed academics with PhDs in economics control the fiat currency supply.

Fiat currency is created with a mouse click.

It doesn’t even require a printer.

And it doesn’t take work to make new fiat currency units.

But fiat currency is not money.

What’s the difference? 

 

Read on to find out…

“All the perplexities, confusion and distress in America arise, not from defects in their Constitution or Confederation, not from want of honor or virtue, so much as from the downright ignorance of the nature of coin, credit and circulation.”

-John Adams