A Short Discussion About What MONEY IS
Money is an idea that has guided mankind since its beginning; this idea being expressed more formally by the words ‘wealth’ and ‘income’. Money is any verifiable account or document that normally is accepted as payment for products and services and payment of debts, including taxes, in a specific country or socio-cultural context. Money may be defined as collections of things that have a monetary value and usually are issued by governments. Commonly used money is also called ‘fiat money’.
Money is a very important medium of exchange in the modern economic system. Its functions are performed through banks which lend it, accumulate it and lend it again. The major mediums of money are bank deposits, bullion coins, certificates and special currencies that are usually issued by central banks.
Bank deposits are a type of medium of exchange for non-monetary goods. They form a liquid medium of payment when needed and are also a safe medium of depositment. Bank deposits are the medium of payments for the debts of individuals. In the modern world bank deposits are usually issued by central banks for use as debt securities by private individuals. They may be used for debt consolidation and other short term purposes.
Time deposits or time advances are types of bank deposits that are usually not returned during the course of a specified period. They are sometimes referred to as time liabilities. The most commonly returned type of time deposits are time credits.
Money is a medium of exchange that represents the values of certain goods. Money is usually collected and stored by the money traders so that they can sell them at a future time. Money traders purchase currency with the money notes that they have collected from people who have given them the goods that they want to trade for cash. The most widely traded form of currency in the market today are banknotes.
MONEY AND CUSTOMERS: Money and customers are closely related. Customers usually buy goods from stores and bars that issue currency notes. The government-issued money that circulates in the market usually comes in the form of banknotes, which are liabilities that can be traded for goods. If the store owners decide to accept these liabilities as payment in terms of cash, then both the goods and the liabilities will be transferred in the form of cash. MONEY LAUNCH ACCUMILATION: Money is thought of as an accumulation, and accumulation always means creation.