Money is not a store of value. It is a claim upon value
Note: This was originally published as a response to the Aeon Conversations piece ' What is Money ' Money is not a store of value. It is a claim upon value. This might sound like pedantic semantics, but it is crucially important, especially if you’re trying to alter how it works. Imagine a Coca Cola bottle with Coke in it. That bottle is a store of value. If I open it and drink the Coke, it will kickstart energy processes in my body and help me to carry on surviving. Now imagine a piece of paper next to the bottle that says ‘whoever holds this is entitled to claim this bottle of Coke’. That’s a claim upon value. If a group of people come to believe in the validity of that claim, the note can be passed around as a means to metaphorically ‘transfer’ Coke value, or - more accurately - to transfer access to Coke value. That’s then a form of money. The fundamental difference between the note and the Coke can be tested by a simple experiment. Burning them. Imagine I drop the Coke in...