What is money?

HJP · November 5, 2020 10:45AM

What is money?
A representation of value – of agreed upon specie (i.e. coins, “bank” & other types of “notes”, seashells, ounces of silver, pork bellies, bushels of wheat.... what ever has a perceived and recognized value - at the time of transaction and is of agreed upon value to BOTH parties).

What is specie?
An object that has an agreed upon value.

Who determines the agreed upon value?
The parties who enter into a transaction.

Can we disrupt use of “Digital Money”?
See above.
HJP

HJP · November 5, 2020 11:32AM

On a small scale, it will be possible to circumvent the use of Digital money to a degree. There are many scenarios for implementing the use of “specie” to do business.

The infrastructure to implement a new “specie” based monetary system - that is private and not a part of the Digital banking system - can be set up to use “specie” and Digital money as needed (at relatively low levels, individually). An exchange rate for “specie” to “Digital money” - will be agreed upon by the parties involved when they enter into a new transaction.

Barter is a good way to look at the use of “specie”. When we “barter” or “trade”, the parties involved in a transaction must reach agreement agree on the “value” of what is being exchanged. Taken a step further, the promise to “barter” or trade, at the agreed upon “value” can be set up to act as a fiduciary instrument that obligates buyer and seller to perform – at a future date. No need for anything but a simple “note” between parties stating the terms & valuation agreed upon. This “note” now becomes “specie” – it has an agreed upon value (expressed in “specie” units of value) and performance terms.

Perhaps business A needs X pounds of commodity Y and reaches an agreement to trade with company B. The “specie value units” and terms of the agreement are memorialized in the form of a note, that note now becomes “specie”. Company B delivers the agreed upon commodity to company A, and company B delivers to company A & the specie is cashed or “called in”.

This way of doing business is just another way to define “units of value” and avoid the use of Digital money for transactions where agreement of value is established between the parties to the transaction – and no one else.

Depending on the type and demand for a company or individuals products or services, “specie” can be set up to be exchangeable, based on “items of value”, that are stored and administrated by a “specie holding organization”. This organization would be owned by the individuals and companies who are providing the “specie” inventory for the “specie units” outstanding (i.e. in use). Problematic, sure – but look at what we have to deal with now?

It will take a lot of effort to coordinate such a project on any significant scale. The initial “specie” exchange models would most likely be community based and be segmented within various types of businesses and individuals – based on their needs.

Supply and demand will determine what the perceived “value units” are for a given product or service. This is an extrapolation of the ancient barter system and can only work when those who trade are honorable and fulfill their obligations to perform. The “legal” issues will need to be sorted out, but this is a different subject…

Lots of complications and risks, but it can be done.
HJP

Kkathyl · November 5, 2020 11:43AM

Money is a negotiable instrument that is used in general commerce to set a trade value on good and or services. It can be in many different types of physical characteristics and must be backed by a legal governing body that is approved by a country or countries. When I say money we have 2 types. Sound money and Fiat.
Sound money is backed by physical assets primarily Gold Fiat is what the federal reserve and other use and is tied to GDP labor and other nonsense. 👍

blitzdude · November 5, 2020 12:16PM

What is money? Around here it's just a bunch of red digits on a computer screen. Semper Fi!

HJP · November 5, 2020 12:47PM

As long as all “specie” transactions are quantified in units of “specie” value and are not stated, published or recorded as being equivocated with any countries Digital money units (i.e. Dollars, Rubles, Euros, Yuan…etc.) – we can play this “money” game.

There will be attempts to break this method of transaction by those who benefit from the use of Digital money. Only good business ethics, trust, honorable people and agreement of “specie” unit value need to be in place for business to happen using “specie”. What is agreed upon in private can and should remain in private. All this is challenging – but so is what we are faced with, economically from tax hungry governments.

Profits are defined by the increase in the number of “specie” units that are agreed to be transacted between parties for a given commitment (products or services). As the demand for a given product or service increases or decreases, so will the relative quantity of “specie units” used for trade.

It will be incumbent on each company or individual to account for their “profits” – just as is true now - we legally must report our trade revenues “profits” and “losses” to the tax authorities. The conversion rate from “specie” to Digital money for tax purposes will be problematic – as the tax authority will not participate in the determination of “specie units” value. Herein lies the main issue at hand. If we can work around the legal definitions and tax code interpretations in using “specie” to do business (it does appear to be legally possible), we can use “specie to transact business and minimize our tax liabilities.

The more onerous and subjective tax authorities become, the more alternatives to “Digital money” will be sought and implemented.

Got Specie?
HJP

derryb · November 5, 2020 1:22PM

Money is what two parties agree to use to settle a transaction. My two cows for your six pigs; money at work. . . even though I can't print more cows.

MsMorrisine · November 5, 2020 1:46PM

this sounds like a sales pitch for crypto currency.

MsMorrisine · November 5, 2020 2:14PM

SPECIE

Specie is metallic money in all of its forms, gold or silver traditionally, but including nickel and copper as well. Specie is distinguished from other forms of money such as paper money or credit instruments like checks, money order, credit cards and the like. The term specie is also occasionally applied to gold and silver bullion, which is ordinary gold and silver, as opposed to coins with collectible value.

https://www.encyclopedia.com/social-sciences-and-law/economics-business-and-labor/economics-terms-and-concepts/specie

dpoole · November 5, 2020 6:43PM

Money is the stuff that gets you all excited when you get it, as a substitute for the other stuff.

DNADave · November 5, 2020 7:02PM

I don’t know but I can go the grocery store and get a whole buggy full of food without giving them anything. Just swipe a piece of plastic for whatever I want and walk out the door. I never had ‘money’ to start with since my employer puts the digits right into the bank account.
Money = my time.

Baley · November 5, 2020 7:20PM

Every so often it's useful to define everyday words in, like some Zen, Existential way, huh?

Yeah man, money is like a spectrum of physical, electronic, cultural, and conceptual phenomena, huh!

Like wow man, my house is a money! My job makes money, and whoa! My stuff made of metal is money too, dude pow!
Mind blown 🤪
You're right, DNADave, it's stored time and energy, flowing around and getting created and destroyed, produced, transformed, consumed, renewed. Plus clinked and Stacked in a LockBox, huh fellas?
Whose got the key?