Tuesday, November 17, 2020

Value of Money

We value money just because it is perceived to have value by everybody else. 

Money in itself has no intrinsic value, it is just a piece of paper or a number in your digital bank balance. The very allure of having more and more of this commodity without the need of utilizing it for anything is rather strange. People want to have billions and billions of dollars in their bank but have no need or intention to spend them in any way. It is like the tulip mania of the 17th century. People wanted to get more tulips because the value of tulips was perceived as going up, not that they had any need of tulips or they were trading tulips for their needs/luxuries.

What if money comes with an expiry date?

If money had an expiry date, say the death of the person who earned it or 100 years, people will be forced to spend it instead of stock it. The fundamental property of money/wealth that it can be stored will be destroyed. It can have earth-shattering ramifications on the way we humans exists.

1. No stocking of money: Money will stop being stocked in the bank accounts. There would be a pressing need to spend it within its lifespan.
2. Fulfilling lives: People will be enjoying more fulfilling lives as the very need to store money would be gone and people would be spending generously.
3. More Charity: People would tend to donate any unspent and going to expire money and/or would be more included towards charity.
4. Less Tax Evasion / Black Economy: Tax is evaded for the sole purpose of stocking more money. With no more need of that extra money, the population would tend to be more honest and find it less useful to evade tax.
5. Having a rich dad or mom would mean much less now.

What if the same concept of expiry is applied to other forms of wealth (real estate, precious metals, etc.)? Say all the properties owned by you will be returned to the society once you are dead.
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