RE: Adam Smith on Capitalism: My Review of "The Wealth of Nations," Book 1, Chapter 4: "of the Origin and Use of Money"
Reading this commentary on the Smith's work is quickly becoming my daily routine. Love it man, I hope you keep it up.
When I took economics in high school I wasn't able to grasp the concept of money very quickly. It took me a while to understand but like most things that re difficult to understand, it was truly worth the time I spent on learning it.
The idea of a common item, the value of which doesn't depreciate over time and is agreed upon mutually to be a worthy store of value was more of a necessity than anything else. Different people/civilizations found different approaches to a common theme - tools/skins/nuts/salt and sugar and its conclusion to the metals.
It is interesting to remember that of course the medium of exchange today holds no intrinsic value of its own but the underlying principle's remain much the same. The topic of currencies will actually take us in a different direction and I see that you wisely chose to keep on track. Would be waiting for the next post on the 3 questions.........
Thank you for this comment! I am glad that you did learn the concept of money. Clearly you overcame your learning barriers. It is also fun to think about how we got to this point where, as you said, "the medium of exchange today holds no intrinsic value of its own." We really have taken the idea quite far from its original starting point. I look forward to seeing how it progresses through cryptocurrency. I did not have time to write the next article yesterday, so I am writing it today. Thanks again!
Thanks for the reply man. I am already looking forward to seeing the next post of the series :-)