Money Rules the World
Money is one of the most important factors of the world. Money holds value, currency, and status. Money can have the power to make human beings do crazy things, and can often lead humans to think a certain way. Why is money one of the most influential factors on Earth? What is money really? Prior to reading and listening to these articles I thought of money as power.
When our class first learned about idea of Stone Money, I was shocked. While first hearing about it, the idea of a middle ages children’s story glimpsed into my head. It was interesting learning that on the island of Yap currency was measured in large stone. After reading Milton Friedman’s “The Island of Stone Money”, I realized that although the island of Yap and the U.S currency doesn’t look the same it generally the same motive. I feel as though authoritative figures manipulate the people with the concept of money. The Island of Yap, the people deciphered the more value fei with a black painted cross. I compared the fei to the U.S dollar. The U.S dollar has numbers written on them for Americans to decipher the value of the dollar.
Money can have the effect of empowering people. In Friedman’s essay, he mentions that the wealthy people of Yap did not need proof of their fei that they were wealthy and it was not questioned. The United States and the Island of Yap’s currency are very different. A feature of our monetary system that the Yap might consider bizarre are banks. Banks track how much money a person has, it costs money to keep money in banks, it is also a trusted place where people keep their money. The people of the island of the Yaps would probably think of the idea of a “bank” to be bizarre because they see and hold money. Friedman’s essay explains that wealthy people in Yam remain wealthy by family tradition. “There was in the village near-by a family whose wealth was unquestioned, — acknowledged by everyone – and yet no one, not even the family itself, had ever laid eye or hand on this wealth.” (Friedman.) Wealthy people of Yam are wealthy because families claimed having many or large fei. In the United States of America, a person is not wealthy without record of their money, people can also go bankrupt when they do not have enough money and banks can track that. It is interesting that different places have their ways to value currency. It makes me think, money rules most of the world, and is a huge aspect of life but is it even real?
After listening to the NPR broadcast “How Fake Money Saved Brazil” I am very aware of the concept “one man can change the world”. But in this case a group of friends. It was very nice to read how intrigued this group of friends were about the economy, enough to help the inflation of Brazil’s economy. It was very interesting hearing about college students saving their counties economy from major inflammation, especially with a virtual currency. It made me think, if money is such a stable factor in our world how could students come up with a fake currency to help their fix Brazil’s economy? It was insane to see the examples of how the inflation could have affected prices. “At that rate, if eggs cost $1one day, they’ll cost $2 a month later. If it keeps up for a year, they’ll cost $1000.” (Joffe-Walt). The group of friends made a “fake” virtual currency, with no bills or coins. They named the virtual currency “Unit of Real Value” (URV’s). I was amazed how much of an impact a group of economists could make, a big enough impact that even their taxes use URVs. “The idea was that people would start thinking in URVs – and stop expecting prices to always go up.” (Joffe-Walt). With a new currency, the people of Brazil were probably confused and relieved. One of the most confusing factors of this probably was the technology aspect. The NPR broadcast “How Fake Money Saved Brazil”, states that people called it a fantasy and many of people did not understand what the new Brazilian currency was. What made Brazilians trust the new virtual currency? What I think made the people of Brazil trust the new currency (URVs) was a couple things. One being that people still had the “real” currency, but just about everything was listed in URV’s so it probably made people more familiar. Also, another thing that could have helped make the people trust the virtual currency, was realizing that it was for the people and the economies benefit. The economist’s idea to fix the economy with their virtual currency “Unit if Real Value”, was beneficial. The new currency (URVs), became the real currency, the inflammation in Brazil ended. This broadcast made me realize that people impact and influence money and currency.
For a couple of years now something that has been interesting me is Bitcoin. This really relates and is relevant to the topic “Money Rules the World”. Bitcoin is a virtual decentralized currency that is trying to take over all other currencies. Bitcoin cannot be tracked so the United States government does not have the ability to control it like the U.S dollar. Bitcoin is now treated like a commodity and people are making fortunes from it. Two years ago, Bitcoin was estimated around two hundred and fifty dollars per coin. In December of 2017, Bitcoin reached its high of nineteen thousand five hundred dollars. I can relate this to the NPR broadcast, because just like the economists made the virtual currency (URVs) from being a fake to real currency in Brazil to help the economy from inflation. Bitcoin is also a virtual currency trying to become a major currency, except trading Bitcoin is helping people make money or perhaps lose money in some cases.
- Joffe-Walt, Chana . “How Fake Money Saved Brazil.” NPR.org. 4 Oct. 2010. 30 Jan. 2015. <http://www.npr.org/blogs/money/2010/10/04/130329523/how-fake-money-saved-brazil>.
- Friedman, Milton. “The Island of Stone Money.” Diss. Hoover Institution, Stanford University , 1991.
- Lee, B Timothy. “Want to really understand how bitcoin works? Here’s a gentle primer” 15 December 2017 .