It looks like you're using an Ad Blocker.
Please white-list or disable AboveTopSecret.com in your ad-blocking tool.
Some features of ATS will be disabled while you continue to use an ad-blocker.
Money is anything that is generally accepted as payment for goods and services and repayment of debts. The main functions of money are distinguished as: a medium of exchange, a unit of account, a store of value, and occasionally, a standard of deferred payment. Money originated as commodity money, but nearly all contemporary money systems are based on fiat money. Fiat money is without value as a physical commodity, and derives its value by being declared by a government to be legal tender; that is, it must be accepted as a form of payment within the boundaries of the country, for "all debts, public and private". By law, the refusal of an offer to pay in legal tender extinguishes the debt in the same way acceptance does. The money supply of a country consists of currency (banknotes and coins) and demand deposits or 'bank money' (the balance held in checking accounts and savings accounts). These demand deposits usually account for a much larger part of the money supply than currency. Bank money is intangible and exists only in the form of various bank records. Despite being intangible, bank money still performs the basic functions of money, being generally accepted as a form of payment.
Money originated as commodity money
A commodity is some good for which there is demand, but which is supplied without qualitative differentiation across a market. It is a product that is the same no matter who produces it, such as petroleum, notebook paper, or milk. In other words, copper is copper. The price of copper is universal, and fluctuates daily based on global supply and demand. Stereo systems, on the other hand, have many levels of quality. And, the better a stereo is [perceived to be], the more it will cost. One of the characteristics of a commodity good is that its price is determined as a function of its market as a whole. Well-established physical commodities have actively traded spot and derivative markets. Generally, these are basic resources and agricultural products such as iron ore, crude oil, coal, ethanol, salt, sugar, coffee beans, soybeans, aluminum, copper, rice, wheat, gold, silver and platinum. Soft commodities are goods that are grown, while hard commodities are the ones that are extracted through mining. Commoditization occurs as a goods or services market loses differentiation across its supply base, often by the diffusion of the intellectual capital necessary to acquire or produce it efficiently. As such, goods that formerly carried premium margins for market participants have become commodities, such as generic pharmaceuticals and silicon chips. Contents [hide]
A commodity is some good for which there is demand
but nearly all contemporary money systems are based on fiat money
The term fiat money is used to mean: * any money declared by a government to be legal tender. * state-issued money which is neither legally convertible to any other thing, nor fixed in value in terms of any objective standard. The term derives from the Latin fiat, meaning "let it be done". Where fiat money is used as currency, the term fiat currency is used. Today, most national currencies are fiat currencies, including the US dollar, the euro, and all other reserve currencies.
which is neither legally convertible to any other thing, nor fixed in value in terms of any objective standard.
It is a product that is the same no matter who produces it, such as petroleum, notebook paper,
Humans are bipedal primates belonging to the species Homo sapiens (Latin: "wise man" or "knowing man") in Hominidae, the great ape family. They are the only surviving members of the genus Homo. Humans have a highly developed brain, capable of abstract reasoning, language, introspection, and problem solving.
humans are the only species known to build fires, cook their food, clothe themselves, and use numerous other technologies.
A strict definition is elusive; technology can be material objects of use to humanity, such as machines, but can also encompass broader themes, including systems, methods of organization, and techniques. The term can either be applied generally or to specific areas: examples include "construction technology", "medical technology", or "state-of-the-art technology".
In economics, the term currency can refer either to a particular currency, for example the US dollar, or to the coins and banknotes of a particular currency, which comprise the physical aspects of a nation's money supply. The other part of a nation's money supply consists of money deposited in banks (sometimes called deposit money), ownership of which can be transferred by means of cheques or other forms of money transfer such as credit and debit cards. Deposit money and currency are money in the sense that both are acceptable as a means of exchange, but money need not necessarily be currency.
but money need not necessarily be currency
n most cases, each private central bank has monopoly control over the supply and production of its own currency. To facilitate trade between these currency zones, there are exchange rates, which are the prices at which currencies (and the goods and services of individual currency zones) can be exchanged against each other. Currencies can be classified as either floating currencies or fixed currencies based on their exchange rate regime.
each private central bank has monopoly control over the supply and production of its own currency
A central bank, reserve bank, or monetary authority is a banking institution granted the exclusive privilege to lend a government its currency.
While one-to-one bartering is practised between individuals and businesses on an informal basis
organized barter exchanges have developed to conduct third party bartering. The barter exchange operates as a broker and bank and each participating member has an account which is debited when purchases are made, and credited when sales are made. With the removal of one-to-one bartering, concerns over unequal exchanges are reduced.[