LET'S THINK ABOUT WHAT MONEY REALL IS.

This was originally posted here http://www.dailypaul.com/... on March 23rd 2008, but became inaccessible during the attacks on Daily Paul a few days later.

This is a repost.

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The very popular story of money goes something like people used to barter , but it was inconvenient, therefore, money was eventually invented . I think this story is totally bogus and it is extremely misleading.

I think that the origin of money was born when humans first learned to store food (if not even before). I think that by the time humans have had learned to store food, humans had been living together for quite sometime, and a group had dominant members who likely became in charge of the stored food. Then, I think that the dominant members made some vague promises to the rest of the group that the food would be shared later. These vague promises, in my opinion, were the origin of money. Then, most likely, ordinary members of the group, later, negotiated how much food they should get. This, I think, was the origin of market.

Eventually, humans evolved and I think that the vague promises were replaced by pictures on a cave wall, sea shells, some metals, etc and these were money at one point or another in human history. Then, perhaps, hundreds of thousands of years later, humans had evolved to a point that individuals became capable of producing enough foods or goods, and humans bartered for the very first time, and it was rather inconvenient since we were already used to using money for, perhaps, hundreds of thousands of years before that.

In any case, I think that a couple of important things to realize here are that the sum total of the money represented the entire economy and the money that individuals held represented their shares of the economy. Also, people exchanged their shares of the economy with some goods or services. When people expanded the economy by producing some goods or services, the money supply was also expanded and some shares of the expanded money supply were rewarded to those who expanded the economy.

However, by far the most important thing to realize here, in my opinion, is that those who controlled the issuance of money had the power to control the entire economy and these dominant members also had the power to control the entire group. In other words, those who controlled the issuance of money also controlled the government.

Today, the time has passed, but I don’t think the rules have changed, at all. The total money supply represents the entire economy of a country and the money that individuals hold represents their shares of the economy. Individuals exchange their shares of the economy with some goods and services. Individuals who expand the economy are still rewarded by money and the money supply is expanded as the economy expands. Those who control the issuance of money still hold the power to control the entire economy, and they still control the government.

In this line of thinking, I think we should all realize that if a world currency was established, it would mean that those who would control the issuance of the world currency would control the entire world economy and the entire world government. It does not matter if the money was backed by gold or it is fiat. Who has the power to issue whose money is by far the most important issue. Whoever would control the issuance of the world currency would control the world. Establishing a world currency means establishing a world government, in my opinion.

Also, in this line of thinking, I think we should also realize that an attack on a currency really is an attack on a sovereign nation. Some people may point out that a world currency is more desirable to solve exchange rate problems. However, in this line of thinking, exchange rate problems caused by manipulations really are indications of attacks on sovereign nations. In other words, the problems are not in the monetary system, but the true nature of the problems is the nations are being attacked. Then, to say a world currency would solve exchange rate problems is equivalent of saying, “if sovereign nations surrendered, they would not be attacked anymore.”

I think that a world currency means the world conquest by collectivists.

I think that diversification of money issuing power is by far the most important issue because the issue of who has power to issue whose money really is the issue of who controls whom. I think that what money is made of, gold or fiat, is a much less important technical detail. Diversified money issuing powers should mean less government powers and more individual sovereignty. I think that individualists should not only prefer money issued by sovereign nations, but also consider a possibility of giving individual states the power to issue their own money. In other words, more diversified money issuing power and more individual sovereignty. Of course, there will be exchange rate problems, but the exchange rate problems caused by manipulations are not the problems of monetary system. Collectivists who desire to gain control over sovereign nations, states and individuals would attack their money. That is the problem. We should diagnose the problem correctly. In terms of the accuracy of representing an economy by money, a money supply that represents a smaller unit of economy should be more accurate.

Finally, I think we should definitely preserve our right to barter. The right to barter really means individual sovereignty, in my opinion. Barter, in my opinion, is a very new concept in the history of money. As we evolve from being collectivists to individualists, money issuing power should eventually, perhaps hundreds of years from now, be further diversified in to each individuals.

Let me know what you think.