It always seemed ludicrous to me that quite a lot of people daydream about stumbling upon a bagful of money or winning the lottery. Still many others dream of a huge inheritance from a relative they didn't know exist. We think the physical existence of money is the solution to everything. All of us are preoccupied with having more money, but very few think about how money is made.
Well of course it doesn't grow on trees. And if it were as simple as being printed off a machine with ink and paper, then counterfeiting money and circulating banana money around should not be a problem.
Imagine in your mind - money. It's just a piece of paper, not that much different in physical nature from another piece you scribble numbers down on. A piece of RM50 is worth RM50 only because both you and I agree the value of it is exchangeable for RM50 worth of another value. The cost of minting coins, I think, will eventually outgrow the cost of printing a RM100 note as technology progresses. MONEY, after all, does not have value by itself. It's value is determined by a collective agreement on the value this coin or this piece of paper, represents. Money is essentially a denominator that is easy to carry around, is not easily perishable and is agreed to be valuable by a majority of people. The exchange of money is an exchange of value.
And value is determined by the skill level, demand and supply of an economy.
Money is a collective grand illussion that we all agreed to. We all agreed that this piece of paper or that is worth this or that amount. And we collectively agreed to it. It is not the money itself that will make you rich. It is your ability to generate valuable economic functions that determines the value of the economy you are in. That is the reason why printing your own money doesn't work. If you do not output value, the economy doesn't have a value. All the money you print and put into the economy, minus any value you contribute to society, simply makes counterfeit notes banana money.
The Banks and their various mechanisms determine the value of an economy and print the exchange medium (coins and notes) accordingly.
Now, how do we create value? Think back on the age of barter trading. Yes, it is as simple as that. You create a product of value that you can exchange with others for. The free or semi-controlled market forces determines how much value you can exchange for it. I have 10 banana trees in my backyard and I don't feel like going bananas eating them everyday. I want some of that coconut that neighbour across the road has. I exchange a bunch of bananas (50 fingers?) for 5 coconuts.
But we can't spend our entire lives harvesting and surviving. We have to specialise in what we do. An economy is nothing more complicated than the creation of ideas. I have 1 packet of koay teow, some tau eu, taugeh, spring onions, shrimp, etc. It can sit there and I cook it for my family today. Or I could specialise in it and put an idea into it - those coals aren't going to fire themselves up, those oil and chili and tau eu aren't going to stir themselves.
Do not underestimate the creativity of the human mind. Each of us are rewarded based on the product and service we bring into the market. Our rewards commensurate with 3 things : How skilled we are in producing the product/service, how much of our product and service we can market to people and how well we manage and duplicate the production of our product/sales. It all boils down to Coming up with an Idea and together with Possessing a Skill, Marketing them and Manage it.
Essentially, the more skills and ideas you have, the more value you can put into the economy. And the higher your individual skill level is, the more value you generate for other people. I also have to quote T.Harv Ecker when he says, "If you want to make ten times more money, help ten times more people with the value that you can create."
Of course we can argue that a lot of people who possess neither skills nor ideas nor management of these in desirable quantities get the cream of the economic crop. Well, the only reason they're there at the top of the economic food chain is because they possess information.
But do not despair. This is the age of Information Explosion. Knowledge is no longer the Exclusive of a few. When enough people focus on their abilities and start producing real value and real advantages, market forces would drive cronies out of business. In a perfect economy, the more knowledgeable and savvy people become about their place in society and the economy, the lesser power the feudal lords of modern day have over us.
Money does solve a lot of problems. When you can generate more value per capita for yourself and your local economy, people who are taking free rides will start feeling the pressure amongst highly critical and highly productive people. With money in your hands, you can choose who you're going to give your business to. And you can choose to not give your business to people who are trying to take a free ride.
The highest value you can exchange for, therefore, is the value of knowledge, the value of knowing how to think and evaluate, the value of knowing which information is relevant to you in this deluge of information we surrounded by.
There are many problems in society to be solved - but it all starts with the minority who's ready to take a stand.
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