Quote from: deuxmill on November 08, 2011, 11:41:19 PM

Quote from: kiyote on November 08, 2011, 10:06:32 PM

Quote from: deuxmill on November 08, 2011, 03:14:43 PM

Quote from: FreeTrade on November 08, 2011, 12:30:49 PM

Quote from: deuxmill on November 08, 2011, 11:51:15 AM

So having a patch of land you don't have money ?

Correct. You have wealth, not money.

I think you don't understand the difference between money and wealth. We should all try to remind ourselves of that difference from time to time.

Please explain to me the difference. So that i can remind to my self of that from time to time.

All currencies together are currency . They are money only in certain conditions which i explained above. Money is wealth and wealth is money . even if we didn't invent currency money would still exist because we can exchange our wealth through barter.
Money = wealth in exchange.
Currency = fictional item invented for the sole purpose of being exchanged.

Let me ask you this: If for example a town would revert to barter would it have any money? Could it use it's wealth to trade with other towns? Or would they absolutely need currency? Sure they can trade ... they give oil for food for example and that wealth is money at that very moment and it ain't currency because if no one want's their oil for example they could just use it themselves to power some tractors.

This is my view on things.

What is money in your view ? All currencies ever invented? If that is the case then you are right. If we refer to money as a distinct term for all currencies and only currencies , that don't represent wealth and can only be exchanged for wealth then you are right.

In this case, land is a resource (http://en.wikipedia.org/wiki/Resource), meaning it acts as a source from which some benefit is derived, in this case you live there, you can grow crops on it, etc. As such, you are right, the land does have a value associated with the derived benefits.

In the barter system (http://en.wikipedia.org/wiki/Barter_system), you would exchange use of the land directly with other resources. You could rent out a corner of it for a baker to set up shop on, and in turn he gives you a hundred loaves of break a week.

But a hundred loaves of bread is a lot of bread, much more than you can eat. You could try to find someone else who needs them before they spoil, such as the blacksmith, where you can give him 5 loaves of bread for a new shovel. But if he, lets say, already made a set of knives for a baker for 20 loaves, he doesn't have any need for bread and the loaves spoil, so you would need to find someone else to trade with.

But this is a lot of work, so you set up a Medium of Exchange (http://en.wikipedia.org/wiki/Medium_of_exchange). In this case, every week the baker gives you a hundred coupons each worth a loaf of bread. Whenever you want a loaf of bread, you would give him a coupon. You could then buy your shovel from the blacksmith for five coupons, and then the blacksmith can exchange it whenever he needs bread, or he can go to the local tailor and trade in a bread coupon to fix his shirt that he burnt while working on the forge.

After a while, the king notices your new private bread currency (http://en.wikipedia.org/wiki/Private_currency), and thinks it's a nifty idea and the whole kingdom should use them. So he commands his royal scribes to write bread coupons and his royal bakers to accept them for bread, and then commands all the people in the land to accept them as an official state-mandated currency (http://en.wikipedia.org/wiki/Currency).

And that's the story of how a resource became a currency. Wink

You are absolutely right . The only difference that i could spot , and you can call me whatever you like , I don't really care , is : I consider that when they exchanged that set of knifes for 20 loaves they used those resources as money , because they EXCHANGED resources. The notes are money for as long as the baker has bread. If he doesn't you and all the others can take the notes and shove them up your ass/ down your mouth but you won't get much out of them. Therefore the notes are currency.

It's just a matter of perspective after all.

from thefreedictionary.com :

mon·ey (mn)
n. pl. mon·eys or mon·ies
1. A medium that can be exchanged for goods and services and is used as a measure of their values on the market, including among its forms a commodity such as gold, an officially issued coin or note, or a deposit in a checking account or other readily liquefiable account.
2. The official currency, coins, and negotiable paper notes issued by a government.
3. Assets and property considered in terms of monetary value; wealth.

You're right. Technically it would be considered as a Commodity Money (http://en.wikipedia.org/wiki/Commodity_money), where the value of exchange is intrinsic to the item itself. Where commodity money fails is that the value is very subjective dependent upon my immediate needs: if I don't need any more bread, and don't know anyone else who I can trade it with, it carries a low value for me, but to my neighbor, who's starving, it can carry a much higher value.