Would life without money be unthinkable?On August 30, 2019 by admin
Money is often considered dirty, both literally and figuratively , because of its power and its importance in our lives. Money is a universal means of exchange with which we make payments for goods or services. In essence, cash settlement is the same old exchange process that has existed in the world since the very beginning of trading. This exchange item was created to create value for things and make settlement much easier.
Without money there would be an ordinary barter system in the world. Such a system requires an exchange rate that determines how much each item is worth in relation to the other. Since billions of objects can be sold and bought in the world, this exchange rate, arranged in a table, would be almost infinite. This amount of data could theoretically be processed by a computer, but creating it would also cause great problems and confusion among people. All this can be accompanied by a variety of goods. For example, apples may be of different degrees of freshness and be of a particular variety. It would be quite difficult to determine the course for each type of apple.
The exchange process would have a high potential for fraud
Nowadays, money is made with various security features so that it cannot be counterfeited. But what would you do if you wanted to swap apples for a Sprite drink? It is impossible to ascertain that they are exactly the quality and variety of the apples as well as to say if the real “Sprite” is poured into the bottle. Everyone should have the means to ascertain the authenticity of the exchange item, but without money it would be impossible.
In a world without money, it would be difficult to make savings. You don’t want to buy it all at once, but you want to make sure you can buy it in the future, for example, in a month or even a year. Money savings can remain intact for years and all that can change is their exchange rate value. In contrast, the apples or milk you receive during the exchange in a ” cashless world ” will not remain fresh for a long time and its value will disappear. Since it is impossible to make any savings and money is practically the only thing that can be stored for a long time, banks and various other financial institutions simply would no longer exist.
Carriage of payment goods would become very difficult
For example, if you were asked to pay 10 tickets for two entrance tickets to a movie theater, it would be quite comical. The same would happen in other cases and the transportation of these goods would become very difficult. Collecting tax and money transaction information would become virtually impossible. The indivisibility of goods would also be problematic. If you were to trade your pants for pants one day, but would like to buy some bread the next day, spending only half the value of the pants. Would you split them in half or exchange all their value?
We can see what a world without money would be like
We can imagine it, but it would be impossible to survive in it. It was useful in the past or among less developed nations, when only a few commodities needed to be exchanged. In today’s world this system would no longer work. The Barter system in today’s economy would indicate complete economic collapse and distrust of the government. We could live with the free market economy for a while, but after a while we would have to go back to money . The money comes from the barter system. Therefore, we can be thankful that money has been created as a means of payment that has facilitated all payment processes for centuries.