Felix Martin unofficial biography of money. Felix Martin Money. An unofficial biography of money. Stone Money Island

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Felix Martin
Money. Unofficial biography of money

Dedicated to Christina

MONEY: THE UNAUTHORIZED BIOGRAPHY

Copyright © 2013 by Failu Ltd

This edition published by arrangement with A. P. Watt Limited and The Van Lear Agency

© Publication in Russian, translation into Russian, design. Sinbad Publishing House, 2016.

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What is money?

Everyone knows what money is, except economists, but even an economist can write a chapter or two about it...

Alison Hingston Quiggin

Stone Money Island

The Yap Islands, located in the Pacific Ocean, remained one of the most remote and inaccessible corners of the planet even at the beginning of the twentieth century. An idyllic tropical paradise nestled in a tiny archipelago nine degrees north of the equator and more than 300 miles from its nearest neighbor Palau, Yap had no contact with the world outside Micronesia until the last decades of the 19th century. However, there was one episode. In 1731, a group of brave German missionaries landed on the islands and founded a settlement here. However, the next year, when the ship returned for them, it turned out that Christianity had not taken root under the canopy of palm trees. All the colonists, at the instigation of local shamans, dissatisfied with the sudden competition, had been mercilessly slaughtered a few months earlier. After this, the Yap Islands were left to their own devices for another 140 years.

- in the summer of 1885, they built a house on one of the islands and settled their governor in it. However, the Spaniards lost sight of the tenacity of Bismarck's Germany in everything related to foreign policy. The Foreign Office does not care that the island is small and remote - if it can be added to the list of empire possessions, it will be added to it. An international dispute has erupted around the Yap Archipelago. As a result, it was agreed that the Pope would act as the arbitrator on this issue - a rather paradoxical decision, if we recall the history of the islands. The Pope ordered to give political control over the archipelago to Spain, but to grant Germany unlimited rights to trade on its territory. As history has shown, the Iron Chancellor was the winner: within fifteen years, Spain had lost the war with America, lost control of the Philippines and lost influence in the Pacific. In 1899, Spain sold Yap to Germany for $3.3 million.

The absorption of the Yap Islands by the German Empire turned out to be a very significant advantage: thanks to it, the world learned about one of the most curious and original monetary systems. An American named William Henry Furness III, a famous polymath and eccentric adventurer, became interested in the archipelago. The scion of an influential New England family, Furness first studied medicine, then became interested in anthropology and published popular travelogues about a trip to Borneo. In 1903, he spent two months on the Yap Islands, and a few years later he published an article in which he described the nature and population there. The virginity of these remote islands, even in comparison with Borneo, made an indelible impression on him. Despite the limited number of inhabitants - only a couple of thousand people - and modest size (according to Furness, “each island can be walked up and down in no more than a day”), a rather complex organized society has formed on Yap. There was a caste system, a tribe of slaves, brotherhoods of fishermen and warriors who settled in separate dwellings intended only for them.

The people of the islands had accumulated a rich tradition of dances and songs, which Furness recorded with particular pleasure. The local religion, the existence of which the missionaries discovered the hard way, included a detailed description of the creation of the world. According to native myth, the first Yap people arose from a shell stuck to a piece of wood carried by the waves. But the most striking thing Furness discovered on the islands was undoubtedly the monetary system.

The economy of the islands was simple. The market was represented by only three goods: fish, coconuts and the only luxury item - sea cucumber. Agriculture was absent; handicrafts and crafts were reduced to the simplest; domesticated animals included pigs, to which cats were added after the arrival of the Germans; The local population did not trade with the outside world. In short, it would be difficult to find a more primitive and isolated economy. In such primitive conditions, Furness did not expect to find anything more complex than ordinary barter exchange. Indeed, on a land where, as he observed, “food and clothing grow on trees and are available to everyone,” even barter would seem excessive.

Stone money of the Yap Islands, which had a highly developed monetary system

However, the reality turned out to be completely different. The Yap Islands had a highly developed monetary system. Furness must have been convinced of its presence as soon as he stepped ashore, since the money here was extremely unusual. They represented heavens- “large and dense stone wheels, from a foot to twelve in diameter, with a hole in the center, varying according to the size of the stone, into which, if necessary for transportation, a stick of sufficient strength could be inserted.” The stone was mined on the island of Babeldaob, located 300 miles from the Yap archipelago. According to legend, most of the stones were brought in ancient times. The cost of each stone was determined primarily by the size, as well as the smoothness of the surface and whiteness.

Furness initially suggested that this form of currency was chosen not in spite of its bulky size, but precisely because of it: “If it takes the efforts of four strong men to steal a sum of money equal to the price of one pig, no one would want to steal. As one would expect, he further adds, cases of theft heavens practically unknown." However, over time, he noticed that cases of transfer were no less rare. heavens from one house to another. Financial transactions took place, but their participants usually paid off mutual debts, transferring the balance to future transactions. Even when there was a need to repay debt, physical exchange heavens usually didn't happen. “A characteristic feature of stone money,” writes Furness, “is that the owner does not have to claim it as his property. When entering into a transaction for an amount that is too heavy to move heavens“, it is enough for the new owner to acknowledge that the stone has passed to him, after which the “coin”, without applying additional marks to it, remains in its original place, near the home of the previous owner.”

Furness never tired of being amazed at the originality of the local monetary system, and then the guide told him an even more amazing story.

In a village nearby lived a family known for its wealth - no one doubted that this was so - and yet not a single person, including family members, had ever seen or touched this wealth in their lives; family capital was gigantic heavens, the existence of which everyone knew only from legends; for the last two or three generations it has rested on the ocean floor!

As it turned out, the ship that many years ago transported heavens, crashed on the way from Babeldaob.

And yet the general consensus was that the fact that a stone had fallen overboard was of no consequence, and that a couple of hundred feet of water separating it from the shore had no effect on its value... In other words, the purchasing power of the stone remained the same as if it stood outside its owner's house, and is a sign of wealth just as much as the gold in a medieval miser's box, or our own silver dollars in the treasury in Washington - we have never seen or touched them, but that doesn't bother us exchange paper certificates among themselves certifying that they are there.

Furness's travel notes, published in 1910, were hardly addressed to economists. However, over time, one copy of the book fell into the hands of the editors Economic Journal- a journal published by the Royal Economic Society - who gave it to a young Cambridge economist who had recently been transferred to the Treasury in connection with the war. His name was John Maynard Keynes. The man who was destined to revolutionize our understanding of money and finance in general over the next twenty years experienced a shock. Furness’s book, he wrote, “introduced us to people who approached money in a philosophical way that no one else on the planet could. The modern practice of creating a gold reserve can learn a lot from the more logical rules and customs of the inhabitants of the Yap Islands.”

Why did the greatest economist of the 20th century believe that Yap's monetary system contained such important universal lessons? This book is dedicated to answering this question.

Great minds think alike

What is money and where does it come from?

A few years ago, over a glass of wine, I asked these two questions to an old friend of mine, a successful entrepreneur with a thriving financial services business. In response, he told me a story. In primitive times, money did not exist, there was only barter. When people felt the need for something that they themselves did not produce, they found someone who had it and offered to exchange it for something they produced. Of course, the main problem with barter exchange is its inefficiency. You need to find a person who has exactly what you need, and who needs what you have, and at the same time. So at some point the idea arose of choosing a single thing and making it a universal means of exchange. Theoretically, it could be anything - the main thing is that everyone agrees to accept this thing as payment. In practice, the most widely used are gold and silver - metals that are quite strong, malleable, light and rare. Gold and silver items became attractive not only in themselves, but also because they could be used to make purchases and accumulate wealth. In other words, it was money.

This is a very simple and understandable story. And besides, as I explained to my friend, she was very old and trusted by a lot of very smart people. One version of this story can be found in Aristotle in his Politics, the first work of Western culture on this topic. A similar theory was formulated by the father of classical political liberalism, John Locke, in his Two Treatises of Government. Well, if this is not enough, we can remember that the same ideas are reproduced almost verbatim by Adam Smith in “An Inquiry into the Nature and Causes of the Wealth of Nations,” a book that became the basis of modern economic theory. Here is an excerpt from this work (chapter “On the origin and use of money”).

But when the division of labor was just emerging, the possibility of exchange often encountered very great difficulties. ...The butcher has more meat in his shop than he can consume himself, and the brewer and baker would each willingly buy part of this meat; they cannot offer him anything in exchange except the products of their own trade, but the butcher has already stocked up on the amount of bread and beer that he needs for the near future. ...In order to avoid such inconvenience, every reasonable person at any stage of development of society after the advent of the division of labor, naturally, had to try to arrange his affairs in such a way that, along with the products of his own industry, he would constantly have at his disposal a certain amount of such a commodity, which, in his opinion, no one would refuse to take it for himself, offering it in exchange for the products of his trade.

My friend and Adam Smith even agree that it is not so important which commodity will serve as money.

It must be assumed that a variety of goods were consistently selected and used for this purpose. In the barbaric state of society, such a common object of exchange was supposed to be cattle. ...As they say, in Abyssinia the usual means of trade and exchange is salt; on the shores of India - shells of a special kind, in Newfoundland - dried cod, in Virginia - tobacco, in some of our West Indian colonies - sugar, in some other countries - skins or tanned leather, and, as I am told, at present in Scotland There is a village where a worker often brings nails to a bakery or beer shop instead of money.

Both Adam Smith and my friend also agreed that the most convenient medium of exchange was usually precious metals like gold or silver.

However, in all countries, people, apparently from indisputable reasons, have finally found it necessary to give preference to metals over all other things for this purpose. Metals can not only be preserved with the least loss, for hardly any other objects have greater strength in comparison with them, but they can also be divided without any loss into any number of parts, which can then be easily fused again into a single piece; This quality is not possessed by any other product distinguished by the same durability, and it is this property, more than any other, that makes them suitable to serve as an instrument of exchange and circulation.

In response, I told my friend that he could congratulate himself - without any economic education, he nevertheless came to the same conclusion as Adam Smith. And that's not all, I added. The theory about the origin and nature of money is not just an amusing historical curiosity like the geocentric model of Ptolemy, which in his time seemed quite reasonable, but was later debunked. Everything is quite the opposite - today the presentation of this theory is found on the pages of almost all economics textbooks. It is the idea of the origin of money as a medium of exchange that has formed the basis of much theoretical and empirical research in the field of economics conducted over the past sixty years. From there, economists have built complex mathematical models to explain why people choose a particular good to use as money, and how much of that good they are willing to use for this purpose. Thanks to this theory, a whole analytical apparatus emerged, designed to study and explain every aspect of the use of money and its value. It is from this that macroeconomics emerged, a branch of economics that seeks to explain why financial booms occur, why every financial bubble eventually bursts, and how we can manage business cycles through interest rate controls and government spending. In other words, my friend’s idea not only has historical value, but to this day is the cornerstone of the theory of money, recognized by both professionals and people generally far from economics.

By this point, my friend was beaming with pride. “I know I’m smart,” he said with his usual modesty, “but it still amazes me that I, an amateur, could come to the same conclusion as the giants of economic thought, although until recently I had not asked this question at all . Don’t you think you may have wasted so many years studying economics?” I agreed that there was some strangeness in all this. But not because my friend, having no scientific training, came to the same conclusion as Adam Smith. Quite the opposite. The problem, in my opinion, is that economists who have spent years training agree with the above theory of the origin of money. And despite all its simplicity and apparent logic, it has one serious drawback. It is completely untrue.

Stone age economy?

John Maynard Keynes was right about the Yap Islands. The stone money described by William Henry Furness may seem like just an interesting curiosity that has no special significance for the appearance of money. However, the fact of their existence raises a number of questions about the modern theory of money. In particular, to the postulate according to which money arose as a result of the development of the idea of barter exchange. When Aristotle, Locke and Smith reason about this, they rely only on logic. None of them observed any real economy that existed solely on the basis of barter. However, it seemed to them quite acceptable that such a system could exist, but turned out to be so inconvenient that it had to be improved. From this point of view, the economy of the Yap Islands looks rather strange: given its primitive nature, it could easily rely solely on barter, but in reality there was a fully developed monetary system. Perhaps the Japanese economy was the exception that confirmed the general rule? But if even in such a primitive economy money already existed, where did the assumption come from that other, more complex economies were reduced solely to a barter system?

In the hundred years since Furness published his notes, many scientists have asked this question. As historical and ethnographic data accumulated, the Yap Islands were seen less and less as an anomaly. No matter how much researchers searched, they could not find a single society that relied only on barter exchange for its economy. By the 1980s, leading anthropologists studying the topic of money had reached their verdict. In 1982, the American scholar George Dalton wrote: “Barter as a non-monetary market exchange has never, in the past or today, been a major or significant part of economic activity in any economic system known to us.” Cambridge University anthropologist Caroline Humphrey comes to a similar conclusion: “History does not record a single economic system based solely on barter, let alone that the concept of money evolved over time from such an economy. All available ethnographic evidence suggests that nothing like this ever existed.” Gradually, similar views began to seep into the circles of economists, arousing keen interest among the most open-minded of them. Thus, Charles Kindleberger in the second edition of his “Financial History of Western Europe” writes: “Some economic historians argue that economic relations have evolved from a barter economy to a monetary one, and from there to a credit economy. For example, a similar point of view was shared by the representative of the German historical school Bruno Hildebrand; but this idea is wrong." By the beginning of the 21st century, a consensus was reached: based on empirical evidence, we can safely say that the theory of the origin of money from barter has no basis. Or, as anthropologist David Graeber put it in 2011, “there is a lot of evidence that nothing like this existed, and none that anything like it actually happened.”

However, the history of the Yap Islands does not simply challenge the traditional theory of the origin of money. It also makes us doubt how correctly this theory formulates the very concept of money. Traditional theory views money as a “thing,” that is, an object chosen from many other objects as a unit of exchange—as a universal commodity that serves to exchange some goods and services for other goods and services. But the stone money of the Yap Islands does not fit into this scheme. Firstly, it is difficult to imagine that it occurred to anyone to use “large heavy stone wheels with a diameter of a foot to twelve” as a universal means of economic exchange - with such dimensions it would be much easier to directly exchange goods. But the main problem is that heavens did not correspond to the definition of money as a universal commodity that can be exchanged for other goods, because for the most part no one exchanged it with anyone. A good example is the case of heavens from a sunken ship. No one had even seen this “money”, let alone exchanged it with anyone. It’s a strange thing: the inhabitants of the Yap Islands did not care about themselves heavens. The essence of their monetary system was not stone money used as a medium of exchange, but something else.

But if you analyze the story told by Adam Smith about how people choose this or that product to use as a means of exchange, it becomes clear that the Japanese economy is not an exception to the general rule. Smith argues that at different times in different parts of the world, a variety of goods were used as money: dried cod in Newfoundland, tobacco in Virginia, sugar in the West Indian colonies, or nails in Scotland. However, soon after Smith published his Inquiry into the Nature and Causes of the Wealth of Nations, doubts began to arise about the veracity of these statements. For example, the American financier Thomas Smith, in his Essay on Currency and Banking, published in 1832, argues that Adam Smith was mistaken in considering all the above examples to be examples of how a commodity becomes a universal medium of exchange. In each of the cases described, financial settlements were made in pounds, shillings and pence. Records of issued loans and accumulated debts were calculated in monetary units. And the fact that a commodity was used to pay off a debt did not mean that this very commodity was considered money. In other words, attention should have been paid to the units in which credit records were kept, and not to what this loan was repaid with. If we consider a certain commodity as money, even exotic money, then we can quite logically come to frankly absurd conclusions. Alfred Mitchell-Innes, the author of two underappreciated works on the nature of money, clearly demonstrates the flawed nature of such claims.

Once you think about it for a moment, it becomes obvious that a widely distributed commodity cannot be used as money, since in theory a universal medium of exchange should be accepted as payment by all members of society. Therefore, if fishermen paid for the goods they needed in cod, then sellers would have to pay for the cod they received in cod, which is absurd.

If heavens on the islands Yap were not a means of exchange, what were they then? And, more importantly, what then served as money, if heavens Can't you count it as money? The answer to both of these questions is surprisingly simple. Money on the islands was not heavens, and a system of lending and loan repayment. Paradise were simply a means of keeping track of who owed whom what. Paradise They just helped with the accounting. As in Newfoundland, the Yap Islanders accumulated loans and debts by trading fish, coconuts, pigs and sea cucumbers among themselves. The loans were then used to pay off debts. If, upon completion of the transaction, someone remained in debt to someone, this debt could, at the mutual desire of the parties, be written off in exchange for a monetary unit, that is heavens. Stone money served as material evidence that a particular person, relative to the rest of the population, had a certain positive balance of payments. In other words, coins and bills are nothing more than tokens that serve to visually display the status of credit in relation to others. They may be necessary even in an economy that involves a much larger number of participants than on the Yap Islands, and provided that the “coins” rest on the bottom of the ocean, but no one would even think of doubting the wealth of their owner. Coins and bills themselves are not money. Money is a system of credit accounts and debt repayment, in which cash plays the role of a visual illustration of the state of the individual account of a particular member of society.

The fact that all this seems familiar to the modern reader should not be surprising. After all, money could be considered a commodity, and the exchange of money could be considered an exchange of goods when coins were minted from precious metals. When each bill was backed by gold and, if desired, one could go into a bank and demand that it be exchanged for a certain amount of gold, such reasoning was quite understandable. But those days are long gone. Today, dollars, pounds and euros are not equivalent to gold. Obviously, modern currency is just tokens. Moreover, the overwhelming majority of modern banknotes have no physical form at all. For example, about 90 percent of American dollars and 97 percent of British pounds exist in the form of bank accounts. Currently, most payment transactions are made using a plastic card and a code entered into the computer. Under these circumstances, it takes a lot of courage to argue that a pair of microchips and a wireless connection are a commodity serving as a medium of exchange.

By a strange coincidence, John Maynard Keynes was not the only giant of economic thought who was struck by the concept of money adopted by the Yap Islanders. In 1991, Milton Friedman, a man whose views were radically different from Keynes’s ideology, came across Furness’s book. He was no less amazed than Keynes that the Japanese, being indifferent to physical coins, in fact, clearly demonstrated that money is not a commodity, but a system of lending and repaying debts. “For a century or more, the ‘civilized’ world has regarded as an indicator of its wealth a metal dug up from the depths of the earth, processed and transported long distances, only to be hidden again in a deep underground vault,” he writes. “Is this practice really more rational than its alternative?”

Earning the praise of one of the two greatest economists of the 20th century can probably be achieved by accident. But flattering words from both give reason to take a closer look at the circumstances that caused them.

Usually money is exchanged for books. Or vice versa. But there are very few books about money as such.

Text: Alexander Belyaev
Photo: www.quora.com
In the photo - a banknote of the Kingdom of Bhutan
Book covers and author's photographs are from publishers' websites.

“Everyone needs money, but what is money?!” A question from a song by a famous singer may seem rhetorical, but if you still try to answer it seriously, the answers may turn out to be very different, from a detailed economic-historical excursion to a psychological motivational study.

Felix Martin. "Money. Unofficial history of money" / trans. from English Nikolai Golovin

M.: Sinbad, 2017

Sinbad's series of translated science fiction Big Ideas cannot be denied consistency. First, it published a very sensible book, Sapiens, about the development of humanity as such. Further - more: a new book - about one of the main defining traits of a person - money!
It is known that in the financial world, as in art, specialists are divided, in general, into two large groups: theorists and practitioners. Theorists are respected by everyone, prestigious prizes are awarded and fees are paid for lectures and consultations. But it’s not that they don’t know reality at all, but they hardly touch it with their hands. Practitioners, on the contrary, move huge amounts of money, personally enriching themselves and personally taking risks every minute; they know every dark corner of the market, but are not strong in theories and sometimes cannot connect two words. The author, Felix Martin, is offended by this state of affairs, because he himself is a “playing coach”: both theorist and practitioner: he worked for ten years at the World Bank, and is now a partner in a London trust company.

Martin has the gift of a popularizer. His lively pen draws us a biography of money not even from birth, but from distant ancestors. At the Faculty of Economics, students are usually told that once money did not exist, and then - again! - and they appeared, after which the notorious “commodity-money relations” arose, and this is what we will study. In any ordinary, normal textbook on economic history and/or theory, if they write about the history of money, then two points are highlighted: a) first, some commodity stood out as an exchange equivalent, an intermediary in trade; b) gold stood out as such a commodity because it is rare and valuable (that is, because of its liquidity). Well, and, accordingly, the money - be it a hryvnia, a tugrik, a drachma - was worth something because it was golden and beautiful.

Martin immediately strongly disagrees with all this, believing such ideas to be speculative. He believes that money was immediately invented precisely as money - that is, coins-symbols, and not pieces of precious metal. Money, in his opinion, was born as an expression of credit. That is, roughly speaking, from who owes whom how much of what. The book begins with an extravagant example in the spirit of the “Film Travelers Club” - the island of Yap, on which huge round stones with holes are “circulated”. These “heaven” stones are non-cash money that not only does not need to be transferred to each other, it is also not necessary to see them (one “money” worth a herd of many heads drowned once upon a time, but the family that owns it is still considered rich ). This curious example shows how in the tiny country of Micronesia, where for thousands of years it was possible to live by natural exchange and subsistence farming, monetary relations nevertheless emerged.

Money is not a thing or a commodity, but debt obligations of people and, more broadly, a connection between people. Martin returns to this not entirely new idea (cf. Paul Samuelson’s thesis about money as a “social artificial convention”). Talking about the financial crisis in England in the second half of the 17th century, he notes: “Money was born as a technology built on the revolutionary idea of economic value - an invisible substance found everywhere and nowhere, and present in the physical world only through its symbols, that is, coins.”

Money, of course, is not a textbook, but it is useful as a weapon in the fight against philistine myths that have stuck in the teeth. Here, for example, is a common myth: under the Tsar-Father, the ruble was gold, therefore convertible, but the fact that under the Tsar-Father there was a Copper Riot is just an accident, the Mint messed up. Alas. This is not a “jamb”, but a system. The proof is the acute crisis in England at the same time as the Copper Riot.

“Although around £3 million worth of silver coins were minted after 1663, virtually all of them had disappeared from circulation by the early 1690s. the coins remaining in circulation were subjected to barbaric treatment - people cut off the edges of them, ground them down and beveled them. Since the shortage of coins was extremely serious and even thoroughly mutilated coins were accepted as payment, cutting off the edges of coins was a very profitable occupation. By 1695, a government examination showed that the vast majority of coins in circulation contained only half the original amount of silver, and full-weight silver coins were worth almost 25 percent more as bullion.
The Mint must come to terms with this fact—it is pointless to fight the market.”

The classics from textbooks - John Locke, Adam Smith - here appear as living people, arguing, doubting, and being mistaken. And the overall picture is enlivened by exquisite quotes. For example, the poem “The Murmuring Hive, or Fraudsters Who Became Honest,” written by Bernard de Mandeville, is an apology for corruption, on which everything rests. " With his fable about the immoral bees, Mandeville wanted to say that corruption in politics, business and the army is the price that has to be paid for the wealth of the economy and the strength of the state, which is not afraid of open conflict with opponents“, - the author will assure, analyzing the famous allegory of the early 18th century.

Alexander Sviyash. “The money is inside us. Remove barriers to money"

M.: AST, 2017

« The only measure of a person's price was money, and there are no internal restrictions in the accumulation of money“- this phrase from Money smoothly leads us to the next book, which is from a different series in the literal and figurative sense. And just about what prevents a person from earning as much as he wants.

The author of “Money Inside,” Alexander Sviyash, in personal communication most of all resembles an institute philosophy teacher. A calm, youthful, middle-aged man in lecture glasses and a gray mustache. Candidate of Technical Sciences, psychologist, author of many books on motivation. “I am an engineer by training... at one time in the 80s I became interested in the theory of inventive problems - there was such a thing. As soon as I defended my dissertation, my interest in technology was cut off and my interest in finding new ideas opened up. Interested in abilities and superpowers. During perestroika, I created the cooperative “Center for Children’s Invention” - my friends then opened banks, traded oil, and we<с коллегами>took the children out of town for educational games!”

The games have grown to an all-Russian level. At the height of the activities of MMM and all sorts of financial pyramids, exploiting the dense financial illiteracy of the population, Sviyash held games on economic topics - people played virtual shares, whose quotes reflected real fluctuations in the stock market. A kind of economic simulator. After the 1998 crisis, when the entire stock market not only died, but froze for many months, Sviyash returned to the topic of abilities and superpowers. " I went to all sorts of seminars about the third eye and thought: how can this be used in real life? I realized that it’s impossible - you have to be either a healer or a magician. But the idea arose that, without changing his lifestyle, a person can change himself a little, and if he correctly formulates his goals, then his effectiveness will increase somewhat. Then the understanding came that our desire is weaker than the barriers that slow us down" In 1998, Sviyash wrote and published the first book on this topic - “What to do when everything is not the way you want”, and since then, according to him, he has been developing “the ideas contained in this book.”

It is impossible to retell the methodology, that is, you can only word for word, otherwise it makes no sense. There is no answer to how to make millions quickly. Although there are certain tips for calculating real and hidden earnings. Without any magic, visualizations or other witchcraft for the full moon. No, this is purely about the internal attitude that determines your behavior - economically as well. Many of us have friends - and we ourselves sometimes, to be honest - have been complaining for years about work, boss, salaries, fees and dreaming of change. Sort of. But in fact, we are satisfied with everything - and this is the most disgusting thing. This is a trap that the subconscious has built and what the author calls the “Reptilian brain” (the part of the gray matter that is responsible for instincts).

The author is a realist, a pragmatist, far from idealizing the conditions in which we live. On the contrary, it is precisely these our so-so-conditions of existence that are taken into account: “In people living in safe conditions, the Reptilian brain has almost no influence on the decisions that the Mind makes. But this sharply reduces the survival rate of such people if they find themselves in dangerous conditions" In an interview with your reviewer, Alexander Georgievich gave a shockingly simple example of how this works:

“Here people live in some Germany or Norway, they are not afraid of anything, then some Breivik starts shooting - and no one knows what to do. He shoots - they stand. Somewhere in Chechnya he wouldn’t have left his house with his machine gun!”

In short, the book is not about how to make money, but how to remove internal barriers. Discovering them first.

- music reviewer, literary translator. Previously, he was a bank employee, an economist by training.

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Felix Martin
Money. Unofficial biography of money

Dedicated to Christina

MONEY: THE UNAUTHORIZED BIOGRAPHY

Copyright © 2013 by Failu Ltd

This edition published by arrangement with A. P. Watt Limited and The Van Lear Agency

© Publication in Russian, translation into Russian, design. Sinbad Publishing House, 2016.

1
What is money?

Everyone knows what money is, except economists, but even an economist can write a chapter or two about it...

Alison Hingston Quiggin

Stone Money Island

Stone money of the Yap Islands, which had a highly developed monetary system

Furness never tired of being amazed at the originality of the local monetary system, and then the guide told him an even more amazing story.

In a village nearby lived a family known for its wealth - no one doubted that this was so - and yet not a single person, including family members, had ever seen or touched this wealth in their lives; family capital was gigantic heavens, the existence of which everyone knew only from legends; for the last two or three generations it has rested on the ocean floor!

As it turned out, the ship that many years ago transported heavens, crashed on the way from Babeldaob.

And yet the general consensus was that the fact that a stone had fallen overboard was of no consequence, and that a couple of hundred feet of water separating it from the shore had no effect on its value... In other words, the purchasing power of the stone remained the same as if it stood outside its owner's house, and is a sign of wealth just as much as the gold in a medieval miser's box, or our own silver dollars in the treasury in Washington - we have never seen or touched them, but that doesn't bother us exchange paper certificates among themselves certifying that they are there.

Why did the greatest economist of the 20th century believe that Yap's monetary system contained such important universal lessons? This book is dedicated to answering this question.

Great minds think alike

What is money and where does it come from?

But when the division of labor was just emerging, the possibility of exchange often encountered very great difficulties. ...The butcher has more meat in his shop than he can consume himself, and the brewer and baker would each willingly buy part of this meat; they cannot offer him anything in exchange except the products of their own trade, but the butcher has already stocked up on the amount of bread and beer that he needs for the near future. ...In order to avoid such inconvenience, every reasonable person at any stage of development of society after the advent of the division of labor, naturally, had to try to arrange his affairs in such a way that, along with the products of his own industry, he would constantly have at his disposal a certain amount of such a commodity, which, in his opinion, no one would refuse to take it for himself, offering it in exchange for the products of his trade.

My friend and Adam Smith even agree that it is not so important which commodity will serve as money.

It must be assumed that a variety of goods were consistently selected and used for this purpose. In the barbaric state of society, such a common object of exchange was supposed to be cattle. ...As they say, in Abyssinia the usual means of trade and exchange is salt; on the shores of India - shells of a special kind, in Newfoundland - dried cod, in Virginia - tobacco, in some of our West Indian colonies - sugar, in some other countries - skins or tanned leather, and, as I am told, at present in Scotland There is a village where a worker often brings nails to a bakery or beer shop instead of money.

Both Adam Smith and my friend also agreed that the most convenient medium of exchange was usually precious metals like gold or silver.

However, in all countries, people, apparently from indisputable reasons, have finally found it necessary to give preference to metals over all other things for this purpose. Metals can not only be preserved with the least loss, for hardly any other objects have greater strength in comparison with them, but they can also be divided without any loss into any number of parts, which can then be easily fused again into a single piece; This quality is not possessed by any other product distinguished by the same durability, and it is this property, more than any other, that makes them suitable to serve as an instrument of exchange and circulation.

Stone age economy?

Once you think about it for a moment, it becomes obvious that a widely distributed commodity cannot be used as money, since in theory a universal medium of exchange should be accepted as payment by all members of society. Therefore, if fishermen paid for the goods they needed in cod, then sellers would have to pay for the cod they received in cod, which is absurd.

Felix Martin

Money. Unofficial biography of money

Dedicated to Christina

MONEY: THE UNAUTHORIZED BIOGRAPHY

This edition published by arrangement with A. P. Watt Limited and The Van Lear Agency

What is money?

Everyone knows what money is, except economists, but even an economist can write a chapter or two about it...

Alison Hingston Quiggin

Stone Money Island

The first European trading post, founded by the German trading company Godfroy and Sons, appeared on the islands only in 1869. A few years later, when it became obvious that Godefroy had not only escaped destruction, but was even thriving, the Spaniards became interested in the existence of Yap - having a colony in the Philippines, only some 800 miles to the west, they decided that this part of Micronesia should belong to them . The Spaniards declared their right to the lands of the archipelago and considered this fait accompli- in the summer of 1885, they built a house on one of the islands and settled their governor in it. However, the Spaniards lost sight of the tenacity of Bismarck's Germany in everything related to foreign policy. The Foreign Office does not care that the island is small and remote - if it can be added to the list of empire possessions, it will be added to it. An international dispute has erupted around the Yap Archipelago. As a result, it was agreed that the Pope would act as the arbitrator on this issue - a rather paradoxical decision, if we recall the history of the islands. The Pope ordered to give political control over the archipelago to Spain, but to grant Germany unlimited rights to trade on its territory. As history has shown, the Iron Chancellor was the winner: within fifteen years, Spain had lost the war with America, lost control of the Philippines and lost influence in the Pacific. In 1899, Spain sold Yap to Germany for $3.3 million.