ECON 1000 Lecture Notes - Lecture 18: Federal Open Market Committee, Nassarius Kraussianus, Blombos Cave
Document Summary
The origins of money: the improbable coincidence of wants, progressively more liquid commodities become money, scarcity, durability, portability, ex: shells of the pea-sized snail nassarius kraussianus. Wear marks indicate the shells were strung on a necklace. The functions of money: medium of exchange, unit of account, store of value. Kinds of money: commodity money takes the form of a commodity with intrinsic value, ex: gold, silver, cigarettes, fiat money is used as money because of government decree (money today) a. It does not have intrinsic value: note: not all paper money is fiat money. Paper money can be a title to a commodity (like gold or silver) ***prof. langlois: if we all stopped believing that money help value, then money would cease. In 2004 there was billion of u. s. currency outstanding: that"s ,134 in currency per adult. Econ 1000 11-2-15: who is holding all this currency, currency held abroad, currency held by illegal entities.
