Monday, February 16, 2009

The cost of money - the value of money

This started out as a blog on money, what it is and what it is now.
Then I found a video here, that kind of said most of it.
So here is just a link to the video.

Below is the half finished blog for what it's worth- I've looked at a few ideas for a more fair means of exchange of work, effort and labour. I've come to understand that the basis of rich and poor, the basis for money of any form, is the desire by humans to be 'more' than other humans. It's probably as simple as that. "I'm more important that you, so one hour of your work is worth only one minute of mine" - or something along those lines.

In the old days: Gold used to be the standard that stood behind bank notes.
The money a Government issued, had to be backed by real gold bullion, real metal, once.

This is now gone, actually it has gone for some time.

You can still buy gold, and gold is still a valuable asset of course, but it is no longer the backbone of the monetary system.

Money now is a virtual entity.

If you live in a certain country the money you have is worth more than in another country because the international currency exchange rate, which is linked to the value of goods, which is linked to what people pay for things they want.

There is another way to view money, instead of using the gold standard, use the human labour time standard.

At its most basic level:
Money is equated to time spend working.
1 hour of labour is worth say X amount of money.

Pretty quickly you will realize that the 1 hour of someone with great expertise and experience is worth more than that of 16 year old just learning how to serve people behind a counter.

So you have to factor experience into the equation.
It's pretty clear that the system can get very complicated very quickly.
How to do you rate experience ? etc....

Some of this way of thinking is already in operation in everyday life.
People spent time studying acquiring certain skills get more money than those who didn't.

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