• Susan Pattis

What Is Money?

Updated: Jul 20

The meaning of money is complicated and comprehensive. Money is beyond most people‘s understanding except for the professional researchers, scholars, and experts of the financial industry. I will not talk about money in the literary style today, I will focus on the more practical aspects of money and its role in our daily lives. The Oxford dictionary defines money as a recognized medium of exchange that is agreeable to all parties in transactional activities in the economic environment with coins and banknotes. There are four types of money: commodity money, fiat money, fiduciary money, and commercial bank money. Ordinary people consider money to be a physical thing called cash, not something in the form of shells, wheels, beads, or other commodities used historically.

Money is the core for most people because everyone uses money as an agreeable means for the payment for goods and services. Very few people think about the meaning of money even though they earn it, spend it, and save it every day. From the economic perspective, money is value, such as a store of value, a standard measurement of value, and a medium of value for exchange. Money provides convenience for everyone on this planet because people have to exchange goods and services in a way that satisfies both parties' mutual needs. For example, a person who owns an apple but needs a candle must find a candle owner who wants an apple before they can complete the exchange.

In the modern world, paper money is more popular than ever. Checks, money orders, credit cards, debit cards, Bitcoin, and wire transfers make the exchange transaction happen instantly. Banknotes, paper certificates, and digital payment platforms have opened the door for ordinary people to trade their creative products or services because consumers trust paper money as much as they believe in cash (or commodity money, like gold). Modern forms of money are more durable, portable, acceptable, divisible, unified, and replaceable. Physical cash or paper money retains its original value over time based on the regulations of the Federal Reserve. Today, money is just numbers transferred from one electronic device (smartphone or computer) to another.

Money plays many roles in our lives, for example, giving a gift, receiving a present, living to pay bills and expenses, saving for future use, borrowing as a debt to deal with urgent problems, and paying taxes to the government. Humans must deal with money every day, earning, saving, spending, and borrowing; the money flow never stops. We must admit that money makes world economics function effectively and efficiently. The value of money determines the world economic order. Without money, the world will go back to the barter economy era. Every country tries to use fiat money (currency) to replace precious metals (mostly gold and silver). The countries that print money without gold and silver as a backup value will suffer severe inflation. So, money itself is a neutral tool but can be used to create good fortune for conscious people or lead to hell by out-of-control spending and over-printing.

The value of money depends on people's faith in it. In countries with high inflation, like Venezuela, Argentina, and Brazil, most people lost their belief, confidence, and trust in their government. Turkey's government has successfully restored confidence by introducing a faith campaign to its citizens. Money will have value if it is accepted by the people and the market; otherwise, money printed by the government has no value at all. Yes, money has many forms as a medium of exchange, more than notes, cash, or coins; and the most robust definition of money is that money is a creative idea supported by confidence. Yes, after all, money is just a powerful idea or meaningful thought.

We know that money is not wealth, abundance, or financial freedom. Having or possessing a large amount of money does not equate to wealth; true wealth is the ability of a person to survive even when they lose a paid job. In other words, money represents a small portion of wealth; and wealth is not money. Wealth is about the abundance of tangible and intangible resources under complete control, covering many aspects, like a good relationship, physical health, personal awakening, and successful career. Money is just the currency used to complete exchange transactions for goods and services.

A very wealthy person may have no money, but with a strong body, close family, satisfying sex, a car that has been paid for, a comfortable house, etc. "I hope GOD will make me walk again if I donate all of my 2 billion dollar assets," a 47-year-old rich man told me a few years ago; he had lost one leg in a car crash. "I learned a big lesson that money cannot buy love and loyalty," a famous Hollywood writer told me after his young fiancé left him for another older director who could offer more money and greater career opportunities. Money can be poison if used for the wrong reason or for evil intention. Money is not bad, but the person who owns it can become greedy. Money makes rich people desire more, their need is without boundary. Money can help compassionate people save more lives through charity. But unfortunately, money also lets the elites and politicians sell their souls or be compromised with accessible benefits from bad guys.

Money has many other meanings, for example, money is a temporary storage place of hard work that can be released in the future for trading for needed goods or services. Money is human pride in buying suitable outfits, improving lifestyles, and lifting the personal image. Money brings confidence because modern people look up to those with a lot of money regardless of their monetary resources. Money offers convenience for the exchange of goods and services. On the other hand, money can become a killer of friendship or love relationships if it involves unfair or unequal transactions. The wrong paradox of 'Money is wealth' confuses many people. Money is not wealth, and it is only the token of value for trading or exchanging goods and services.

Money has nothing to do with fortune; it is an invented idea endorsed by trust and confidence used by humans to exchange for needed materials or services. Wealth is the energy source which you can buy or trade with money, whether it is the car, a house, a coke, or fashionable dress, a scientific discovery, an invention, a great idea from a master thinker, a talented individual, or a stock certificate, etc. A rich person might have many monetary possessions in the bank, but a wealthy man owns love, joy, health, and satisfaction even though he has just enough money to buy the necessary goods and services. "I left my husband, who is a musician, with very little money five years ago to marry a businessman who is my father's age. I have lived a miserable life now with my abusive husband with a billion dollars in assets but without mercy or kindness in his heart for me," a female friend from Taiwan lives with regret now.

Intangible wealth cannot be measured in terms of money, such as a child's love, parents' care, best friends' loyalty, romance, and true love. We live in a realistic world. Most people are obsessed with money but ignore intangible values like compassion, love, integrity, honor, and other mindful thoughts. Money is the eminent tool for goods and services but not for everything. Properties, stocks, bonds, goods, silver, and other precious metals are acceptable forms of wealth, but they are not money. Money can make life easier but can never buy happiness or true friendship.