Minds Create Money
We often think of money as a physical object like a dollar bill. The Yap islanders use mammoth stone wheels as currency. Both hold value because we accept that their cultures accept their value. This acceptance is powerful enough to delay the improvements available by switching to a digital currency. Already, most of the world’s money is not physical; its value comes from universal participation in a digital exchange system. Like belief in a religion, our confidence about the economy depends on our belief that everybody else will “keep the faith.” Without this faith, money fails to function. It is so strong that the Island of Yap has failed to deter tradition.
“The Island of Stone Money,” written by Milton Friedman, explores the Island of Yap’s traditional currency. On this island they use a large rock in the shape of a wheel called a “fei” as their currency. The people that inhabit the island keep fei outside just along the paths that go throughout the island near the houses to whom it belongs. It’s not hard to accept that instead of paper they use rock wheels, fei, as currency, but it’s crazy when trying to wrap my head around the Island of Yap’s dedication to fei. Why keep a giant rock when the Yaps could replace it with a smaller, more convenient object? Because that is what they believe in. The same reason people pray before meals and go to church.
Just as the Yaps use rocks as money we use a mix of physical and digital currency. What I mean when I say electronic money is the number seen in a bank account. The money is never seen, and it’s not in the bank, but a debit card can make purchases with this money. The Invention of Money, a broadcast discussing how money works, says that “at no point does the bank go and deliver like $100 to the phone company on my behalf. It is just numbers going back and forth on the computer.” The connection is that money is just numbers being sent over to the company’s bank, everything in the transaction is digital. Today, more than ninety percent of the world’s currency is digital. Digital currency is turning physical money obsolete.
Digital currency is on a rise mostly because the Federal reserve uses it to benefit the U.S. economy. The Invention of Money broadcast discusses how the Federal Reserve is an interesting organization that can create money, billions, out of thin air. They do this when giving banks money. The Federal Reserve buys a bond and boom there’s a couple billion in that bank’s account. That’s them working their magic all on a computer screen. The Reserve’s purpose is to help balance the economy between economic inflation and depression. They are able to do this by buying things like mortgage-backed securities which pump money into the economy. Everything they create becomes real money. It’s relative to the island of Yap’s system. If someone found a huge rock wheel, then it would be considered a massive amount of wealth. The only difference is that the U.S. is stripping down this concept to where we don’t need physical objects to represent the money. That’s how we have credit/debit cards.
Digital currency has plenty of appeal with its ability to use one card to access the money in a bank account within seconds. However, improving new money is extremely difficult, especially to get others on board after we have our established currency. Bitcoin is one of these new inventions. It is a digital currency, but with a few different features. Bitcoin’s biggest feature is being a decentralized piece of currency. Meaning it’s not operated by a government, business, or person. As it could be beneficial to people, it still has to triumph over the main obstacles: acceptance and faith. “Bitcoin: What to expect in 2015” goes into depth on bitcoin’s struggle for acceptance. Right now it’s hard for people to understand how bitcoin works, and why it would be better than the traditional currency. That’s why bitcoin can’t just take off and become profitable. According to CNBC John Philips, the loss of acceptance led to bitcoin’s value being split in half within a few months. The article also states that “as bitcoin becomes easier for non-tech-savvy people to use, adoption will increase.” See how it is all about the acceptance of a certain currency that allows it to become stable. For bitcoin, it’s like trying to establish a more accepted soda than coke products.
Bitcoin is trying to emerge victorious over the modern currency method today. We might try to swipe aside new currencies because they are a part of the unknown. The unknown possibility of whether it would be more beneficial or not. As the battle between new and old continues we fail to realize that our currency system is always improving over time. The island of Yap used stone wheels like the U.S. used gold as currency back in the late 1800s. From there we used flat dollar bills. Then moving towards today we use a debit/credit card and still use dollars from time to time. As time progresses we will probably never use dollar bills. Every type of currency will probably become obsolete as time goes by, and the cycle of new versus old will ensue.
As long as the idea is held true by everyone and accepted, it will work in terms of money. The reason we have money is to have an acceptable way of exchanging one thing for another. We could use any object as money as long as it acts as an item of universal exchange. Universal participation is key; otherwise, the system will falter and struggle like Bitcoin for acceptance.
Let’s say someone could use an orange to buy a car, and the car dealership could use that orange to pay their employees. The employees could then use the oranges to buy food and supplies. If this was the case, money could be an orange. This shows how the Island of Yap could do so with rock wheels, and the U.S. with numbers on a computer. Strip all the talk about money and it turns out to be a concept close to a religion. Religions are built upon the faith of their followers and money as more followers than probably any religion. In similar likeness, they are also made up of humans themselves. That is why it’s reasonable to say, “minds create money.”
References
Friedman, Milton. “The Island of Stone Money.” Diss. Hoover Institution, Stanford University, 1991.
Philips, John. “Bitcoin: What to Expect in 2015.” cnbc.com. 15 Dec. 2014. https://www.cnbc.com/2014/12/15/bitcoin-what-to-expect-in-2015.html
“The Invention of Stone Money.” 423: The Invention of Stone Money. This Is American Life, WBEZ. Chicago. 7 Jan. 2011.
alwaystired247
AnonymousStudent
azntaco
beforeverge
BigBabyBaller
bitagaming
breakingbad1820
Caravan
cinderella1013
davidbdale
Yankeelover18
duck
fatboy489zt
giantsfan224
glacierfreeze21
gobirds17
green0728
gymrat230
hollyp715
Gir
jerseymikes1106
jesusisking1738
jetsfan806
Kenneth Alex Krug
manipulator66
mercythyhealer14
mochaatrain
oni
powerranger
peanut2348
pinkcottoncandy4
princess01430
redbird1123
rubes1256
shxrkbait
sillyinternetperson
soulpond47240
spatel8267
stingingcrib5
tacotyphoon
thepersonindisguise
usmnt23
worldofjuice999
xephos1
Counterintuitive Fall 2022 
Could you just point out major problems that need to be fixed?
Every essay needs a title, so that’s first, MochaATrain.
Thanks for being specific in your request. I’ll do my best to limit myself to major problems if I find any, and in return, I hope you’ll respond with your feedback on my feedback.
I can’t get past the first paragraph without noting a major problem, but I will promise not to mention it again unless it appears in other paragraphs as well. (If it does, I’ll say, “wanders.”)
Your Introductory content is fine. Your observations are pertinent and interesting. Your organization is like a pile of pick-up sticks. They break out into these sections:
1. Money is thought of as a physical object, usually a dollar bill.
2. Now, believe it or not, most money in the world isn’t physical.
3. Can’t touch it or see it, but the money is real and still has value. This value comes from universal participation.
4. Islands use stones as currency and the U.S. uses a combination of physical and digital currency.
5. The way we use money is almost like a religion. A concept based on faith that strives for acceptance.
6. In this faith, we have clouded our understanding of money.
7. Our history of using physical objects for a currency has prolonged the improvements in digital currency today.
8. For example, the island of Yap still currently uses stone wheels as currency.
9. Though it’s not beneficial to keep it the same way for hundreds of years.
We could gather them into affiliated groups:
1. Money is thought of as a physical object, usually a dollar bill. 8. For example, the island of Yap still currently uses stone wheels as currency. 4. Islands use stones as currency and the U.S. uses a combination of physical and digital currency.
9. Though it’s not beneficial to keep it the same way for hundreds of years. 7. Our history of using physical objects for a currency has DELAYED the improvements in digital currency today.
2. Now, believe it or not, most money in the world isn’t physical. 3. Can’t touch it or see it, but the money is real and still has value. This value comes from universal participation. 5. The way we use money is almost like a religion. A concept based on faith that strives for acceptance. 6. In this faith, we have clouded our understanding of money.
It’s not neat, but these are the main ideas clustered, I think.
We often think of money as a physical object like a dollar bill. The Yap islanders use mammoth stone wheels as currency. Both hold value because we accept their cultures accept their value. But prolonged dependence on physical currency has delayed the improvements available by switching to a digital currency. Already, most of the world’s money is not physical; its value comes from universal participation in a digital exchange system. Like belief in a religion, our confidence about the economy depends on our belief that everybody else will “keep the faith.”
Or something like that. Same content. But organized to guide the reader through the steps.
Helpful? Annoying? Want me to do less? Shall I breeze through the rest of the paragraphs now, or do you want to do some work before I come back?
(Put yourself back into Feedback Please either way. I’ve taken you out of it.)
Helpful. Just needed some things that needed to be pointed out otherwise I wouldn’t notice them and continue to botch it. I’ll do some work on it and see if it gets better
I see you’re back in Feedback Please, Mocha. Any instructions for how I should proceed this time?
just seeing if you think the organization is better. if thats a stupid reason then you can just take it out if feedback please. no worries
I wanted to try and make the main idea about the fascination behind the acceptance of money, so all the different statements(pile of pick-up sticks) could work play in. With that in mind, I tried to work on the talk about the delayed improvement between physical and digital currency as a large example to show the extent of how far the acceptance of money goes. Then relate it back to religion and talk about the similarity revolving around faith and acceptance. Don’t know if this works because a lot is written about digital currency and such, but that was my train of thought behind guiding the reader similar to the way you showed
This is pure repetition. Version 1.
This is pure repetition. Version 2.
If you’re using the example to illustrate faith in the digital economy, you could say so here. The consumer has faith that the phone company has been paid even though she doesn’t write a check or take cash to the phone company office. The phone company doesn’t ask for anything more than numbers on a screen to verify that the consumer’s bill has been paid. Like that?
The other difference between the Yap “finding a stone wheel” and the Federal Reserve “finding money” is that the Yap made sure to choose a tangible commodity that required a long sea journey and a crapload of effort to create new currency. The Feds barely have to lift one finger. Were the Yap less likely to suffer inflation as a result of thus limiting the pool of available cash?
Pretty weak, and the second sentence has an obvious flaw:
Huh? With obsolescence comes acceptance?
When you first demonstrate that you’re rock solid with grammar, I will permit fragments and other stylistic indulgences. But first, convince me you know these sentences of yours break the rules.
CORRECTED:
Note that semicolon; it prevents your sentence from being a “comma splice.”
I like your bold concepts and your breezy style, Mocha, but when your casual tone gets too loose and sloppy, you fail to be understood. Clarity is more important than style. You need a polish, but I’m impressed with your work so far.
Thank you for all the feedback. I’ll work on the comments that I’ve received and probably won’t ask for any more on this assignment.