Money is any object or record that is generally accepted as payment for goods and services and repayment of debts in a given socio-economic context or country. The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value; and, occasionally in the past, a standard of deferred payment. Any kind of object or secure verifiable record that fulfills these functions can be considered money.
Money is historically an emergent market phenomena establishing a commodity money, but nearly all contemporary money systems are based on fiat money. Fiat money, like any check or note of debt, is without intrinsic use value as a physical commodity. It derives its value by being declared by a government to be legal tender; that is, it must be accepted as a form of payment within the boundaries of the country, for "all debts, public and private". Such laws in practice cause fiat money to acquire the value of any of the goods and services that it may be traded for within the nation that issues it.
The money supply of a country consists of currency (banknotes and coins) and bank money (the balance held in checking accounts and savings accounts). Bank money, which consists only of records (mostly computerized in modern banking), forms by far the largest part of the money supply in developed nations.
Other articles related to "money, fiat money, fiat":
... deficit spending is necessary, either to create the money supply (Chartalism) or to satisfy demand for savings in excess of what can be satisfied by private investment ... is logically necessary because, in their view, fiat money is created by deficit spending one cannot collect fiat money in taxes before one has issued it and spent it, and the amount of fiat ... In a quip, "fiat money governments are 'spend and tax', not 'tax and spend'," – deficit spending comes first ...
... Fiat money or fiat currency is money whose value is not derived from any intrinsic value or guarantee that it can be converted into a valuable commodity (such ... Instead, it has value only by government order (fiat) ... Usually, the government declares the fiat currency (typically notes and coins from a central bank, such as the Federal Reserve System in the U.S.) to be legal tender, making it unlawful to not accept the fiat ...
Famous quotes containing the words money and/or fiat:
“Once again, weve wasted time and money by dealing with the homeless backward. Too much energy has gone into deciding where we do not want them to be, and making sure that they would not be there.”
—Anna Quindlen (b. 1952)
“Then for the Style; Majestick and Divine,
It speaks no less than God in every Line:
Commanding words; whose Force is still the same
As the first Fiat that producd our Frame.”
—John Dryden (16311700)