What is Money?

Money is freedom, control and options. It determines the quality of life. Health and happiness may very well depend on it.

Once upon a time, cash was backed by gold in a treasury. Before that, we just used gold itself. Pieces of eight were used as currency because of the intrinsic value and rarity of the metal and the ability to break the coins into smaller “pieces.”

Today, money is nearly an abstraction. We use credit cards to make purchases while our paycheques are direct deposited into bank accounts. With the exception of laundry day, we can live a cash-free existence.

Canada’s currency is fiat, meaning it only has the value the government assigns to it. Those plastic bills have no intrinsic value, except that we, as a society, agree to recognize them as legal tender.

Money solves the problem of asymmetrical trade. Not everyone wants to trade chickens for toilet paper, or rockets for beer helmets, hence the need for intermediary currency.

The dollar represents time, energy and knowledge. We sell ours for legal tender we can then trade in the grand marketplace of society for whatever our hearts’ desire.

Money is the essence of your life’s productivity. There will always be more choices than money and only a finite amount of time to live, so you must manage it wisely!