What is money?
In economic terms money it's the storage of value.(I hope I'm getting it right, all you economist out there).
Hypothetically if it takes a worker last year 30 minutes to buy a dozen eggs and this year it takes that worker 45 minutes to buy that same dozen eggs even though the price of the eggs went down, the value of the work is less.( For argument sake the union excepted lower wages to keep those jobs).
A person puts in a hundred dollars a month into a bank for thirty years along with paying off his mortgage, though some times the putting the hundred dollars a month was put off to help pay the mortgage. The mortgage is paid off, one can argue that the value of the money saved is greater then while the mortgage is being paid off.
A person invests money in the stock market, and makes a bundle, pulls most of the money out, that person can now buy better things then before he put his money in the market.(One can even say that the value of his original money (or investment) increased.
Another person put money into the market and the value of his stock decreases, were he is forced to take a loss. The value of his original money (investment) has decreased. This investor has to buy lesser quality of goods. One can argue that this person is caught up in inflation of his or her own making.
I understand that my reasoning may be hard to understand.
Money is the storage of value only if you let. The real value should be the goods and services that you receive from present or past work, even if that past work has been past on from generation to generation.
Thursday, January 10, 2013
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