What is money? | Saifedean Ammous and Lex Fridman

[@vinkelitz]

Realizing that money was just a representation of value really changed my approach to getting it

[@jozefwoo8079]

How so?

[@vinkelitz]

@@jozefwoo8079 Make things that have value to other people so that you can get value for it.

[@007SuperSoldier]

@@vinkelitz The next step is realizing that the value of the dollar is set by the government, not what the economy agrees to.

[@trixn4285]

@@007SuperSoldier Well, the government is the source of the absolute price level in the sense that it initially tells people what they have to do to earn it (say an hour of service in the military or something like that). But after that all the other prices are derived relatively to that. So the government couldn't arbitrarily set the prices for everything. It can try to set some prices for a period of time but it wouldn't want to do that permanently and on a grant scale.

[@007SuperSoldier]

@@trixn4285 Agreed. A breath of fresh air to hear someone who obviously gets it. The government sets the exchange rate for the services/goods that it provisions itself with, and then the invisible hand of the economy takes care of all other exchanges.

[@spanosspanos]

The “market good” part of money doesn’t come first, that’s just another example of how markets can commodify just about anything. Money exists because of interaction and exchange...the medium of that exchange is irrelevant, it doesn’t even have to be physically real..numbers on a ledger are enough. And that’s the world we live in today...digital ledgers keeping track of the balance of exchange.

[@skipondowntheroad5833]

BITCOIN

[@michaelchisholm6020]

Amazing, informative and engaging interview, keep at it lex 💪 thanks for all you do 👍👊

[@Sajin688]

A very good explanation of what currency is.

[@cryptonian101]

The value of people, basically. It originated at the hunter/gatherer stage of our human evolution through trade. Throughout the millions to hundreds of thousands of years during our primitive human stage, iterations of money changed over time. Ranging from females using men, to tools, to food. As civilization was created, it started evolving from gold and silver. Basically, money is just another form of communication between people.

[@johnnytass2111]

Money is the symbol of human energy.

[@barreI95]

Exactly. Which can be boiled down to raw time. You pay an expert to cut the time down to fix something because they spent their time becoming an expert. You got that money spending time at something you’re good at. Money is a symbol of time

[@skipondowntheroad5833]

​ @johnnytass But the energy spent by a human doing something, can not, by itself, be a symbol of money. If a person spends energy digging a hole and then filling that hole in, that hole or the work (energy) done to create that hole could never be money as nobody would want to exchange anything for it.

[@skipondowntheroad5833]

​@@barreI95 But the time spent by a human doing something, can not, by itself, be a symbol of money. If a person spends a full day digging a hole and then filling that hole in, that hole or the work done to create that hole could never be money as nobody would want to exchange anything for it.

[@johnnytass2111]

@@skipondowntheroad5833 Human energy is real, thus it is not a symbol. Money, however, is the symbol of human energy and can be used as an exchange for actual human work (energy). So a guy can dig a hole and fill it back up and not get paid for it because no one asked him to do this work for them. However, if there is someone who needs a hole dug up, that person can pay money (a symbol) to get the other person to do actual work (exert human energy).

[@barreI95]

@@johnnytass2111 exactly. The time and energy spent is the exchange, not the outcome of how the time and energy was spent. Though you wouldn’t spend money on the hole itself, you spent money on the services that the man spent digging it and filling it. His time and energy spent are represented by his services. Therefore, the fiat currency is a representation of time and energy. The more money you have, the more time and energy you’ve accumulated and can purchase from a larger audience. Same can be represented for a product. If you buy shampoo, you purchased the time and energy it took for the scientists to test and create the formula, the time and energy it took to build the process to manufacture it, and the time and energy it took to ship it to the store for you to buy it.

[@MonaMarMag]

One of the basic things we all should always remember is to : DO NOT EVER CONFUSE PEOPLE WITH A PRODUCT THAT YOU CAN BUY OR SALE ON YOUR MARKET !!! Those who breake this basic rule of life will bear the consequences of what they did . That what life is all about action = appropriate reaction to it . No one should be surprised because this main principle exists as this world has become the world .

[@ericocccams5865]

Money or in a broader sense, currency, exists within the cultural phenomenon of work for prize, labor for reward. So here's a far more interesting question to ask. Why, where and when in human history did this coupling of labor for reward come to be ?

[@stockology2748]

you look at it odd. its really work for work.... the reward is something someone else produced through work.

[@ericocccams5865]

as a employee you get paid by your employer, that is a phenomenon that exists within monetary system. The money system is the phenomena that labor for reward exists within.

[@007SuperSoldier]

Storage of value, Medium of exchange-this is what money *does*, not what it is. Money is an accounting entry-an asset for someone, and a debt for another. Sometimes we represent these entries physically. That’s it. Normally you wouldn’t just accept an accounting entry in exchange for labor. But, the government gets you to accept these liabilities by imposing taxes on you, and then decreeing the Dollar is the only type of accounting entry you can use to pay those taxes. Banks create a type of money that is denominated in the same unit of account as the government’s currency (dollars). You create a type of money that is denominated in dollars when you write a check. You get someone to accept the check via trust of the bank. The bank gets you to accept its checks (deposits) via trust of the governments currency. And the government gets you to accept its currency with taxes. This is called the hierarchy of money.

[@gwills9337]

Thank you for the high school education

[@007SuperSoldier]

@@gwills9337 They don’t teach how banking or the governments currency actually works in high school. They teach you the fractional reserve/money multiplier model, which is wrong.

[@seankennedy4284]

Meh, or not.

[@markarmage3776]

No, little kid. It's still just medium of exchange. What you're talking about is actually a medium of exchange that can be created and destroyed accordingly by certain belief. Specifically the fiat system. That is a kind of "money" but it's not the definition of money. Think a bit harder. Let's say if you're no longer on the fiat system and you trade using gold or bitcoin, the definition of yours fell apart. Banana can be money, a car can be money, sea shells and tulips can be money, as long as they're a medium of exchange, they're "money".

[@007SuperSoldier]

@@markarmage3776 Yes, anyone can create money. The problem is getting it accepted. Sometimes things are accepted for inherent qualities, like nutrition or transportation. Other times, they are accepted by force. In the modern world, we don’t tend to refer to exchanges of equally valuable goods as a monetary transaction. We keep the word money for exchange with mediums. But that’s what money does, not what it is. Those mediums are accounting entries, even if we represent them physically (like with a seashell). I said that in my original comment :) Read harder next time before thinking you disagree with someone.

[@JoeKazemi]

This guy makes sense

[@CG-rb4xo]

Dude is reciting Adam Smith

[@stevenc.5844]

Read the deficit myth and talk to MMT economists…

[@stevenc.5844]

Love how the link keeps getting deleted …

[@stevenc.5844]

kzbin.info/www/bejne/on-0h5mCZ62lZ7c

[@henrygustav7948]

Money is a debt. The Federal governments money, the US dollar is a tax credit. The taxes make USD's the highest form of money in the domestic US economy. Makes it THE medium of exchange that everyone needs in order to pay their tax debts.

[@skipondowntheroad5833]

The USD is a currency that lacks the scarcity property so can never be "money". The USD, being a unit of account and medium of exchange is not enough to achieve money status. It also needs to be a store of wealth. But lacking scarcity the USD will never be used as a store of wealth and therefore will never be money.

[@henrygustav7948]

@@skipondowntheroad5833 Money is a credit that satisfies debt. You are describing its functions as a medium of exchange and store of value. USD are the unit of account of the US Federal government and it is not scarcity which gives it value, its what you have to do to earn it that gives it value. If the Fed govt is paying $100/day for a soldiers wages then it is defining the terms of exchange for its currency.

[@OmarO4]

It's interesting that he follows the traditional neoclassical myth on why money came into existence - to solve the double coincidence of wants - when research has shown that credit systems solved that double coincidence and money came later to quantify debts. -100 points for Saifedean Ammous.

[@dougschimpf8733]

Money is what makes a man act funny

[@skipondowntheroad5833]

To make me act so funny, make me spend my money Make me feel real loose like a long-necked goose Like a girl, oh baby, that's a-what I like

[@tarjalauraeus4847]

desires are manipulated

[@hattrickchu]

legend

[@kialburg]

This dude is acting like "store of value" and "medium of exchange" are the same thing. They're not. If you want to store wealth and persist it into the future, money is a bad way to do that. Buy gold, or jewelry, or land, or stock indexes, or anything else besides money. The purpose of money is to facilitate exchange. But if you're trying to stuff it in a mattress for 20 years and forget about it, you're fundamentally misunderstanding what role money plays in society.

[@johngmckee0]

He's saying its a better store of value than a bucket of apples which is indeed true. The conversation is about the basics.

[@henrygustav7948]

Money has had different purposes, not just a medium of exchange. It can best be described as a representation of debt in a physical form.

[@bahmak2003]

The gold bugs would say “gold is the only money” 😂😂😂😂

[@gravyau]

Even if Bitcoin is 10 Million dollars it still helps unbanked people to trade. They don't care what price they just want a goat.

[@IndoPakCanvas]

Tomorrow you will do a post cast with title of, "What are the A,B,C's".

[@skillerftwerr]

Not tomorrow, but the day after that

[@stockology2748]

you joke but language origins and limits are fascinating

[@marleyjanim5033]

Money- used to purchase goods and services

[@TheR0DFATHER]

2

[@TheR0DFATHER]

Reported

[@OmarO4]

"A market is naturally emerging phenomena." 😂🤣 Jesus, this dude is 100 percent ideology. Markets are created by states and an exchange between two people 10,000 years ago is not capitalism.