Does Money Actually Have Value?
Despite the control that it has over our everyday lives, it is unlikely that most people have actually ever contemplated the concept of money and how our banking system works. What is money and why does it have value?
The American government decided that the dollar was to be used for the purpose of exchange. Dollars have value because society determined that they are something that people should want to acquire. If the people did not agree to the set value of the dollar and that they could be used as a form of currency, then the tangible bills would only be worth as much as the material that they are made of. Thus, anything can become valuable as long as the majority agree to it. As seen by the success of the creation of the Brazilian real, a new form of currency created in an attempt to save the economy when the previous currency became valueless, and the use of the online bitcoin, which does not physically exist and can only be used for online exchange.
The Yap had their own banking and monetary system. They were taking a random material, shaping it, determining that it had value, and then using it as a form of currency. The fei, large, heavy pieces of stone that the Yap used for money, did not even have to physically change hands for one man to become richer. The fei could sit on the previous owner’s property, but as long as it was acknowledged that the stone had a new owner, everyone was content.
However the Yap’s banking system is similar to our own in the way that it relies on trust. Our entire banking system is a pact in which everyone who uses money is involved. We all agree that the dollar has a set value and are forced to trust that everyone will honor that value. We also have to trust that we actually have as much money as we think that we have. A large majority of the time when we exchange money, we do not physically receive or give away money. For instance, when we get paid at work we physically receive a check instead of dollar bills. However, if we have direct deposit we do not even get a check. A couple of numbers in cyber space change and now we supposedly have more money. We have to trust that when the bank says that we have five thousand dollars in our account that five thousand dollars are actually ours.
The story of how the German’s took the fei away from the Yap by not physically taking them but by putting large X’s on them shows how silly, and even precarious, all banking systems really are. It can be compared to the Americans marking the gold in the American vaults as French without physically removing the gold from American soil and the subsequent chaos that occurred when the American people believed that there was less gold in the American vaults. The Germans could even be compared to today’s cyber hackers. When people used to rob banks they had to go into a bank and physically take money out of the safe and stuff it into bags. Now, thanks to our advanced online banking system, thieves can rob banks from their own kitchen tables. They sit in front of a computer, type in a few codes, change a few numbers, and boom, someone else all of a sudden can no longer pay their bills or their mortgage. The victims do not physically have any less money, yet they are poorer.
What is a bank without money? What is money without people? The answer is nothing. Money would be nothing without the people who use it. The value of money relies on people trusting one another and the faith of the people in the economy. The irony is that people feel like money runs our lives, but in reality, we have all the power.
alwaystired247
AnonymousStudent
azntaco
beforeverge
BigBabyBaller
bitagaming
breakingbad1820
Caravan
cinderella1013
davidbdale
Yankeelover18
fatboy489zt
giantsfan224
glacierfreeze21
gobirds17
green0728
gymrat230
Gir
jerseymikes1106
jesusisking1738
jetsfan806
Kenneth Alex Krug
manipulator66
mercythyhealer14
McCormick Karner
mochaatrain
oni
powerranger
peanut2348
pinkcottoncandy4
princess01430
redbird1123
rubes1256
shxrkbait
sillyinternetperson
soulpond47240
spatel8267
stingingcrib5
tacotyphoon
thepersonindisguise
usmnt23
worldofjuice999
xephos1
Counterintuitive Fall 2022 
Can I have feedback please?
Feedback provided. —DSH
P1. You might hate me for this, Simone, but I need to flip your first sentence to show you something I think is important.
First, notice how much closer money and the banking system are to your “despite the control” claim in this version. The sentence gains clarity from that proximity. But the flip also makes obvious that your “it” is supposed to cover both “money” and “the banking system.” Go back and read the original. You’ll notice two things this time: The two “its” are both pronouns with unclear antecedents. What they refer to is uncertain. (Also please note I could—and most writers would—have written “It is uncertain what they refer to.” My version eliminates one vague pronoun and makes a clearer sentence.) So. What should your first sentence be?
Or something like that. Certainly use “we” instead of “most people,” and certainly “money” should be the first word after the comma because it’s modified by the “despite” phrase. I’m belaboring these pointers because you’re already a fine writer I think will appreciate whatever I can offer to sharpen your skills, Simone. But I’ll stop if this seems picky.
Of all my students, you can probably handle rhetorical questions, but these seem careless and lazy. Your first sentence says money is a mystery. Your second one asks, what is money? You could do more. I haven’t read your essay, so I don’t know what to suggest yet, but I’ll listen for a better way to provoke interest than these questions.
P2. Your rhetorical question makes a pledge that you will tell me what money is. This paragraph doesn’t quite deliver. Money has value, you say, because we agree that it does. But also because the government declares that it does. So which is it? And do we agree because of the government’s involvement? If so, that creates an additional layer of mystery for bitcoin, backed by no government at all. We can usually pay for things with our dollars overseas, but suppose a visitor to the US presented drachma, or shekels, or Egyptian pounds at the Wawa. Government backing would be meaningless there. So, what is money again? (You’re close, of course, but not there yet.) You write as if your reader is familiar with the story of the Brazilian real. Most likely you are mistaken. Explain what your reader needs to know.
P3. What Yap? Again, you cannot expect your reader to be familiar with your sources. I don’t see how this paragraph explains banking, Simone. Your first sentence pledges that it will. Are there deposits, withdrawals, loans, interest?
P4. I disagree completely that a dollar has a “set value.” The only constant regarding dollars is that a five is worth five singles. Other than the relative value of the denominations, the government, the dollars, have nothing to say. The market determines what a dollar is worth, whether it buys a loaf of bread or three slices.
You should use the word “currency” to mean the green linen slips in sentences like: “when we exchange money we don’t physically give or receive money.” Otherwise, the sentence is senseless.
What part of the Yap system was built on a similar “trust” that when we’re paid we know the value of our bank account has increased?
P5. What Germans? What Xs? Only I and your classmates can be expected to know, Simone. For all other readers, you need to provide the story.
One intriguing difference between pony express robbers and cyberthieves, Simone. Those robbers got the mingled funds of all depositors, not the contents of individual accounts. When a hacker steals my identity, though, she goes right to the contents of my personal accounts, robbing not the bank but me.
Here’s why you need the word “currency.” The victims don’t own and less currency, yet they are poorer. By this point in your essay, the words “do not physically have any less money” no longer makes any sense.
P6. You might as well say: what is money without commodities? If you’ve seen or read The Road or any number of post-apocalyptic stories, you know it’s pointless to bankroll a lot of currency. Meat becomes money, or gasoline. The world goes back to commodity trading. People don’t really give money its value: they just agree on a rate of exchange. It’s always been goods and services that are the real values we trade.
You write well, Simone, but you have important work to do before this essay can be read by anyone outside our class.
Getting back to those P1 rhetorical questions. The job of your second sentence is to get me to read P2, right? Try a provocative claim (ALWAYS!) instead of a rhetorical question; for example: We don’t examine the meaning of money until a clerk refuses our method of payment, or a card reader declines our debit card, or until the stock market turns our paper “profits” into red numbers. Etc.
Helpful?
—Watch
Sounds good to me. Will keep this in mind when I rewrite. Did you actually change my first sentence in the essay?
I think the in depth feedback is helpful. My comp 1 teacher wanted our re-writes to look almost completely different from our original drafts. However, when she gave feedback it was not as specific. This made it hard for me to do my re-writes for my portfolio as I was not sure in what direction she wanted me to take the paper. I could not understand how to write a completely different paper when she mainly told me what she liked and that I just needed to work on organization. The original re-writes only really had local changes.
Very strong work.
Grade recorded.