Our ancestors of just a hundred years ago may not have known much about “that new fangled telephony or that darn horseless carriage”. However, most of them did know when they were getting screwed on the exchange of their labor for “junk money”. “Don’t...
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Our ancestors of just a hundred years ago may not have known much about “that new fangled telephony or that darn horseless carriage”. However, most of them did know when they were getting screwed on the exchange of their labor for “junk money”. “Don’t take any wooden nickels“, comes to mind. They wanted something of comparable value for their work. Back then, “Paper money” would not be accepted as a “medium of exchange” unless it was backed by something of proven value such as gold or silver. Most were also smart enough to know “you don’t get something for nothing”. My how things have changed! So, why do we accept paper money as a valuable “medium of exchange”? First, what is a medium of exchange? When individual producers exchange their products for other products, we have a direct exchange of goods; “bartering”. As the division of labor became more diversified, bartering became very cumbersome; enter a “medium of exchange.”
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