Infinite Versus Equal
P1. An infinite amount of one-dollar bills is equal to an infinite amount of one-hundred dollar bills. In today’s society, the human race has been made to believe that a small piece of paper with a number on it is enough to give us what we need. Someone could have two one-dollar bills and not be looked at twice, because unfortunately money is something most people value more than a personality or brain. Meanwhile if one has the same piece of paper with a 100 on it instead of a 1, they are looked at with more dignity, even if they are just a kid who’s grandmother thought they could use the extra cash. Nothing changed on the bill except a number, and even a small number can make all the difference in how much wealth a person in this world has. The amount of the bills changes by one small number in the four corners of the bill, which decide a person’s entire life.
P2. Located in the westerly group of the Caroline Islands, in Micronesia is the Island of Yap. In his paper, “The Island of Stone Money,” Milton Friedman tells about American anthropologist, William Henry Furness III’s experience on the Island of Yap. During his visit, he found the way the people of Yap used currency to be of interest. Described as “large, solid, thick, stone wheels, ranging in diameter from a foot to twelve feet,” Furness found the Yap’s money to be intriguing, wanting to figure out how this form of money came about for them. Due to the lack of silver and gold on the island, the Yap resorted to stone once they realized they needed a form of currency on their island so they could buy and sell. Not only is their money based on rock instead of the conventional currency used by most of the world, their money is also based on trust. A piece of rock, or money, fell to the bottom of the ocean years ago, though the islanders have never seen the money, the ones who do not own the money still respect that it belongs to someone and that that person who lost the stone have that money. Much more trust in this society than most in the world.
P3. In countries such as the United States, a citizen would almost believe that money is something sacred, the way people appear to treat it. For example, someone could sell someone a house without either of them seeing the house before the purchase and they trust that they own the house, but only because they gave the money and the people who sold the house see the money. In the United States, there are people who treat money like it is their child, so it seems very unlikely that the citizens in the US are very trustworthy with their money in the hands of someone else. In the podcast, “The Island of Stone Money,” Jacob Goldstein and David Kestenbaum discuss how economists love the island called Yap “because it helps answer this really basic question: What is money?” They also explain how on Yap; money doesn’t need to be physically transferred from one person to another to change its ownership. All it takes is one verbal transaction. They say, “One person gives it to another person. But the stone doesn’t move. It’s just that everybody in the village knows the stone now has a new owner.” In what way does this sound like money is even something more than a concept created to make sure chaos does not break out between people in this world?
P4. Sometimes though, trusting people with money is not something that everyone can rely on. In Brazil, the government was able to trick 150,000,000 people into believing that their money had value. Inflation in Brazil, at 80% a month is through the roof, causing something as simple as a pair of sunglasses to be brought from $80 to $340 in a matter of six months. They could not find a way to stop the inflation. That brings this to a very intriguing point. Why is inflation even a concept? From the first paragraph where it is alluded that an infinite amount of one bill and an infinite amount of another are equal, it brings up the question: Is money real?
P5. Who is there to even trust if there is nothing to be trusted with? Like time, money can be seen as an illusion. A physical, tangible illusion, but an illusion nonetheless. We possess paper, coins, or in the Yap’s case, stones, that are worth everything, but if there’s too much of it, it is somehow worth nothing. Money is a social construct that everyone has agreed to make worth something for convenience. Such as back in the day, bartering was something used, but once currency was brought on everything ran more smoothly. The Federal Reserve of the United States is responsible for creating money whenever they want, yet the country is still fourteen billion dollars in debt. So why not print more? They do not print more because more money equals the value of it decreasing, yet the less we have, the more it goes up. So why do we not just print the fourteen billion we need to climb our way out of debt? No one really seems to have an answer for that.
P6. There’s a form of e-currency out there called Bitcoins whose value drastically jumps from the two-hundreds to the fifties. In the article, “The bubble bursts on e-currency bitcoin,” by Anne Renaut, she goes on to describe the digital currency as something “which was created in 2009 in the wake of the global financial crisis by an anonymous programmer who wanted a currency independent of any central bank or financial institution.” Someone decided that they did not like the way their money was being handled, therefore they just created a new one. The way money is used here, the drops, the raises, the way it is handled is almost fictitious. It seems that if someone is not satisfied by the way their money is being handled, they change the value, or create something new. Yes, it has value, but only on demand. If we demanded something as trivial as apples they would have a lot more value than they actually do.
P7. Back to the Island of Yap, they do not have debt, because how can there be a shortage of rock? Money on Yap is less physical and more transactional, based on trust where one can just say “this is yours now” and it will belong to them with no questions. Yap is a place built on trust, rather than America, where people need to see their money to believe that it’s there and valuable. There’s that classic phrase in movies and TV shows: “Show me the money.” The character in whatever situation they have found themselves in won’t do what they are being told to do until they see their reward. There are other instances in which someone is offered a scholarship, where they do not see the money or reward, but the feeling they have when offered that scholarship is a big accomplishment and they feel on top of the world. They know they are getting their reward, because they see it on the piece of paper in which it was offered on. They saw it. When Americans hear about how the Yap deal with their money, it sounds absurd.
P8. Money is nothing but a concept. Each place in the world handles it different, yet we all seem to think it is one of the most important possessions one can own, when in reality, if one thinks about it, money is an illusion. Tactile, but still, money is not real in the long run. It has value, and the idea of money, the value that it brings to the table is very important, though we could easily switch that ideal system and just start exchanging fish if we wanted to.
Blumberg, Alex, and Dave Kestenbaum. “Weekend At Bernanke’s.” Audio blog post. www.thisisamericanlife.org. N.p., 7 Jan. 2011. Web. 18 Jan. 2017.
Friedman, Milton. The Island of Stone Money. Feb. 1991. Working Papers in Economics E-91-3. The Hoover Institution, Stanford University.
Goldstein, Jacob, and David Kestenbaum. “The Island of Stone Money.” Audio blog post. N.p., 10 Dec. 2010. Web. 18 Jan. 2017.
Joffe-Walt, Chana. “The Lie That Saved Brazil.” Audio blog post. www.thisisamericanlife.org. N.p., 7 Jan. 2011. Web. 18 Jan. 2017.
Renaut, Anne. “The Bubble Bursts on E-currency Bitcoin.” Yahoo! News. Yahoo!, 13 Apr. 2013. Web. 21 Jan. 2017.
Weeks, Linton. “The Trouble With Trillions.” NPR. NPR, 22 Aug. 2011. Web. 22 Jan. 2017. http://www.npr.org/2011/08/22/139846133/the-trouble-with-trillions