Money Without Boundaries

Chapter 2The Fundamentals of Money

“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”

– Henry Ford

As we saw in Chapter 1, human culture's obsession with money has been a determining factor in so much of our history, a constant subject of manipulation and the cause of so much brutality. But what, exactly, is money? That question can send you into a rabbit hole that could swallow you right up. As Robert A. Leonard writes in Money and Language, “Money and language are both highly abstract social conventions. Although we deal with them daily on what appears to be a concrete level, they both really exist only as social contracts; money and language are, if you will, all in our minds.”¹

When most people Google what is money?, Wikipedia is one of the first entries to pop up with this definition: “Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The main functions of money are distinguished as: a medium of exchange, a unit of account, a store of value, and sometimes, a standard of deferred payment. Any item or verifiable record that fulfills these functions can be considered as money.” Wikipedia further defines a country's money supply as “currency (banknotes and coins) and, depending on the particular definition used, ...