The Mighty Mediums Magic Moment

We have all heard the phrase,” money is a medium of exchange”. One writer has called that phrase vacuous. It is because it is incomplete. It’s a medium of exchange of what, between who and who, where, for how much,. So let’s see if we can expand on that.

Money has been said to be a unit of account. Well it is therefore a medium of accounting. It is not just a medium of exchange and accounting but a medium of maintenance. Its owner maintains value as equity in exchange. So it turns out to be a medium of several human goals.

If there is an exchange then we have things moving in such a way as to replace each other. They are replacing not function but form of the function. One traders form might be cash and the others bananas. Or one trader’s currency might be time and the other one’s bushels

For purposes of this discussion we will also use the words money and currency interchangeably. If it is an exchange by two humans between two humans then it can be said to be a commitment relationship unit. The relationship is a debit credit relationship. So we use those words in our definition of currency. But when does it come into existence?. When you hear the words “we have a deal” money has come into existence. With the mutual commitment that Those words represent money reaches its magic moment.