World Financial and Banking Crisis – What Is Money?

What is money? What in the name of Jesus is it?

No matter how many times I ask people, nobody has an answer. They’ll tell you what it does, and what you can do with it. They’ll tell you it’s a means of exchange and a store of wealth. They’ll tell you it’s a standard of deferred payment. They’ll tell you it’s a unit of account.

In other words, they’ll try to define it in terms of what they think it does, not what it is.

Now, to my ill-educated, lumpen, non-financial mind, none of these definitions are good enough to explain what we’re seeing these days.

Take the store of wealth definition, for example. What’s wealth? It used to be an accumulation of resources — the produce of the land; whatever people’s honest labour generated. But not any more. Not in this looking-glass world where everything from an insurance policy to a holiday in Ibiza is called a product. Two nights in some backwoods hotel is a product. A bad comedian’s stand-up patter is a product. Entire countries are products.

It drives me mad to hear people with no useful skill, such as bankers, travel agents and insurance salesmen, talking about their products, as if they had the slightest idea what it is to labour and bring forth something tangible, of value and perhaps of beauty.

Never. Not in the new karaoke world we inhabit.

This is the hubris of the shallow, modern-day non-worker. The so-called professional. The legions of people for whom a real skill is of no value, and whose soft, manicured hands never produced a single useful item. These are the people who feel entitled to refer to their schemes, offers, trades, deals and scams as products, debasing the language and rendering the concept of wealth meaningless.

So there you have it. No point defining money as a store of wealth when we no longer know what wealth is. And anyway, a store is something we expect to be safe, isn’t it? We don’t expect to drive our herd of cattle into someone’s barn and come back tomorrow to discover that half of them are missing. That wouldn’t be much of a store, now would it? But that’s money today.

Money might be a means of exchange, but that just describes one of its uses, and it still doesn’t tell me what this thing we call money really is. After all, there can be many means of exchange, including a very old-fashioned concept: giving your word and keeping it. Yet, that may well give me a hint as to what money could be. Giving your word implies having faith and trust in your fellow man, and I’ll come back to this in a minute.

A standard of deferred payment means nothing. Why? Because we don’t know what payment means unless we can say what money is, and apart from that, it certainly isn’t a standard. No standard I’ve ever heard of keeps changing from one second to the next. For instance, if a metre tomorrow is a little bit longer than a metre today, we’d be in real trouble trying to build a house.

The door won’t fit, Mikey.

What the fuck? I measured it yesterday.

Well, see, there’s your problem. The metre got devalued overnight.

It’s nonsense!

Imagine if the 220 volts in your AC supply was ten times as savage as mine. I lend you my kettle and it fuckin explodes.

What did you do to my fucking kettle?

Sorry. There was a lot of trading in Volts. They’re gone way up on the SI units market. Amperes are down though. Too much resistance.

This is just horseshit.

Back to the definitions. A unit of account.


The word unit has no meaning when it keeps changing its size, and the word account has lately become a blackly funny and deeply derisory term in a universe of credit default swaps, or in a land such as ours, where a banker can be in debt to his own bank to the tune of €87 million without anybody knowing about it.

You see, the only people who have been accountable in this little world of ours are people like you and me. The small guys. The followers. The acolytes.

And the High Priests of the financial universe, who have been pleased to dispense the Truth to us for generations, were, just like the Pope, believed by the followers to be infallible in matters of doctrine.

And there I finally begin to stumble on the kernel of the truth about money. You see, I’m inclined to think that money is nothing but a belief, and I think that when people stop believing in it, money simply disappears. Without a collective act of belief by all of us, the power of the Priesthood is exposed for the empty mumbo-jumbo it always was, and I think that what we’re witnessing across the world now is a gigantic shift. Money, I’m inclined to think, might be nothing more than a measure of the privileges available to us.

When I was a child, at a time when our local Catholic witch-doctors held great influence, we were constantly warned about Losing the Faith, and the dire consequences that would follow. And when our local Catholic clergy were exposed for the lying, child-abusing bastards they are, they left a vacuum, having hijacked and arrogated to themselves our public ethics for so long. The result was an increase in selfishness and viciousness and a loss of respect for our neighbour.

I think that today, worldwide, we’re witnessing all people, everywhere, Losing the Faith, and as always happens when any great belief system collapses, we’re left with a moral void.

Who knows what will fill it?


Previously on Bock

House Prices

Ireland second wealthiest country

Banking Bail-Out €” Irish Government Signs Biggest IOU In History

Rival Bank Helps Anglo-Irish Chairman To Hide Huge Personal Debts

Irish Government€™s Budget Deficit

Bank of Ireland Shares Collapse

Bird and Fortune Explain The Sub-Prime Crisis

Banking Crisis Financial Jargon. The Language of Bullshit

$480 Million for Lehman Brothers CEO

Irish Nationwide Building Society Send Out Begging Email. What a Crowd of Shits!

Irish Government Saves The Banks

Bankrolling a Bank. Ireland€™s Government Guarantees Liabilities of Credit Institutions.

Kredit Krunchy – The Breakfast of Losers

Save The Trader. Wall Street Famine Appeal.

32 thoughts on “World Financial and Banking Crisis – What Is Money?

  1. Common sense will hopefully fill the void, not the bullshit we have been subjected to in the last ten years or so.

    Another way of defining money is to say that it represents the value of labour. Of late this seems to have gone spoons. We pay the consultant seven or so times more than we pay the midwife.

    The relationship between the wages of the bank boss seem to be a trifle off compared to the ordinary bank manager.

    The value placed on the services of our head politicians are somewhat out of kilter with the value placed on the services of a skilled tradesman or woman.

    Perchance we could do with a little of that old faith to pray that common sense prevails.

    or maybe better we could hope that your local Guard will hop down the road and arrest the Bishop of Cloyne for obstruction of justice and Séan Fitzpatrick for defrauding the pensioners who directly or indirectly invested in his bank.

    As you can tell I am an optimist.

  2. We might say money represented the value of labour, if we knew what labour meant. Unfortunately, every twat who can switch on Powerpoint is a consultant these days, charging three grand an hour to talk about “going forward”. Every arsehole with a cut-price diploma in human resources can put on a special-offer Armani suit and claim to be a professional.

    It makes no sense any more.

    Regarding that Bishop, expect to read more about him here before long.

  3. How about money = trust?

    I give you a worthless piece of paper or metal, and you trust that society will exchange it for something else. Simple.

    The reason for the crisis is that the trust has gone.

  4. money = methods of control of the working classes by the ‘proper people’.

    Noticeably no-one from the world of ‘B’ankning has paid for the financial crisis, as usual quite the opposite.

  5. It’s unfortunate that you used Electricity as one of your examples as electricity is a commodity that is traded very agressively just look at Enron. Even in Ireland electricity is a comodity. I believe the “spot” price for electricity is calculated on a half hourly basis based on demand and supply and other shite.
    Everything is a commodity.
    Money only exists as a concept that everybody buys into, in practice we have currencies and they are traded against each other with its value derived based on our “economy” which is another abstract concept as the value of our economy is expressed in Euros.
    It makes your head hurt when you try thinking about it.
    Relax and have a pint you’ll feel better.

  6. Chris — Sorry. Your definition is as loose as all the rest. That might be what money is used for, but it’s not what it is. Whoops! Try again.

    Caoimhín — Thanks

    John — I didn’t use electricity as an example.

  7. The pint of plain you were so kind to drink for me yesterday night, Bock, was obviously worth its money. Great posting!
    By the way, what does a pint cost these days in Limerick?
    And on an even lighter note, as you asked what money is: Money is – according to Woody Allen – better than poverty, if only for financial reasons.

  8. Money is debt.
    The value of the money I take out of my ATM is based on your promise to repay your loan to bank. It’s become so convoluded that the money for deposits now come from credit.
    And while we play with our bits of paper and our digital ones and zeros, who is amassing all the real wealth?

    P.s. Bock, in your list of non-workers you left out the soulless marketing ghouls. The people who study your children so as to know how to get them to pester you in just the right way for that special piece of Chinese plastic at christmas.

  9. The faith thing reminds me of a Terry Pratchett novel where the great god Om was set to return to smite the infidels, but because his power was proportional to the amount of people who believed in him instead of coming back all powerful and shit he came back as a tortoise and no one would believe who he was.

    I’m not going to try to define money, but what ever it is people certainly seem to believe in it. Now that the central authority that controls it has been shown to be a sham, I hope people can go back to taking the good from the object of their belief rather than being scared into putting it all into someone elses interest.

  10. Sean — Depends where you drink. Usually about €4.20.

    Benny — IOU what?

    Craic — Same question. repay what?

    John — Volts aren’t a measure of electricity. They’re a measure of potential. You could have a zillion volts going nowhere. Anyway it’s only a joke example. I could just as easily have said Farads or Pascals.

    Do Orgasm — Yup. Pretty much same as that.

  11. The bank can loan much more than it has in actual reserves. In effect they ‘create’ money.
    The two hundred grand you’re given as a mortgage has no real value. It’s just numbers on a screen. It’s value comes from the bank’s promise to honour it. The bank honour it because you agree to honour it with interest.
    Failing that the bank take your house and whatever you have given as collateral, along with whatever you’ve already payed including your deposit.
    The bank provided nothing but, as defined in the post, a ‘service’.
    The parrallel you drew with religion is interesting because they are both methods of control. Perhaps the money is ficticious but you’ll keep going to a job you hate to pay that mortgage. When crooked governments try to bully you into backing a ‘dig-out’ to their friends/sponsors by telling you that if you don’t the world will come crashing down and you’ll be homeless and unemployed, you’re a little more inclined to listen, a little more inclined to bow.
    Money is the cheese that keeps us scurrying around the maze.
    Money is debt.
    Debt is slavery, eventually..

  12. Brilliant Post Bock.
    I agree with above poster – all money is is debt.
    The pieces of paper, for example dollars, used to be based on an agreement to pay you Gold. That is no longer printed on Dollars.
    All money was based on na agreement to pay you an amount of gold in exchange.
    The interesting thing about Gold is that it, in itself, is pretty useless. Other than being of questionable ornamental value it has few industrial uses.
    If people realised how worthless Gold really is things would get very interesting

  13. Craic — But what is it that they lend?

    Builderfromhell — The gold standard was abandoned a hundred years ago. Gold and money are no longer connected in any way.

  14. Sterling still has “I promise to pay the beare on demand the sum of :insernt note value here:”

    Apparently you dont own banknotes. The bank does. You only own your coinage and the bank promises to redeem you the value in coinage on submission of your tenner. That was the whole principle behind the founding of banks. It was a way to help merchants avoid carrying large heaps of coins around the place.


  15. Your sentiments have been captured this long while by Paul Grignon. He also points out that Money is no more than the promise of an IOU and faith/trust whatever is the glue to prevent that unravelling. The problem is that it has woven its malicious tentacles into our society such that we, the acolytes, would be well f*cked if it failed. Someone earlier said money is debt, that’s just about it. The real problem is people won’t just be content when they have enough of it!

  16. I don’t think that it goes as far as trust. It’s a promise. As meaningful and meaningless as promises are. And as valuable and worthless regardless of your trust.

    But you promised to let me on the bus
    -No I didn’t
    Well Mick promised me you would when I gave him a cabbage.
    -Mick’s promises aren’t worth shite
    But he said you promised him you would when he gave you a cup and saucer
    -My promises aren’t worth shite either. I gave them to Johnno to mind and he lost most of them down the casino

  17. GOM — Thanks for the reference to Paul Grignon. I must see if I can track down his film.

    However, I still have a problem with definition of money as debt, unless you can define what debt is.

    Eolaí — What kind of promise is it?

  18. An unknown promise without parameters. Why people always wanted more money always puzzled me as it always has the ability to be worthless. You’d be better off growing a cabbage and eating it.

  19. Very good documentary on the Federal reserve. I don’t think we’re so different since the ECB.

    Money as debt.

    They don’t lend anything. A ‘service’ perhaps but thats all and you pay for it. It’s an illusion. Smoke, mirrors and interest. But you will exchange your time, the fruit of your labour and real wealth for it.
    How many of us were told how money works in school? About fractional reserves? Why not?
    In my opinion it is because Theonomics, like Theology, likes to explain itself to those initiates who choose to invest in it, be it at the seminary or the business school. It dosn’t do to have the profane asking to many questions.

  20. maybe it would be better to ask where did the concept of money come from? when did it originate? prostitution is considered the oldest profession, is this the starting point of money? did a primative ancestor, in order to get his leg over create a system that is still screwing us to this today?
    also the more assets a person had eg land, cattle, goats etc the greater his prospects for suitable mates acquiring more wealth, you increased prospects and power.a class system where women were considered chattel would only have encouraged this practise of accummulating wealth.
    after thousands of years, this means of acquiring a mate or casual sex has evolved into what we know as money.

  21. This series of Clips from Paul Grignon is very interesting. They explain how money is debt.

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