I was a small boy, the time I started realizing the importance of money and purchasing power of some snacks and toys from my small village vendors. It was a confirmation that money is a medium for owning and having for almost everything. Sooner than later, I discovered that money moves the world go round.
From the ancient historical events, we learned that money was associated with the religious places, and it was smoothly heading to the nobles. It looks to continue still. I came to know that money has been real hard for the populous poor to keep a hand on it but it has an easy flow to a good few temples. Some temples and religious bodies handle money sometimes even more than the banks. So, money is mystic for it stays with spiritual powers and religious personalities which is difficult to understand to the poor.
The strange character and hard to understand the role of money has prevailed. Some other days, during our childhood, my friends and I were talking about drawing and painting money on paper when we grew up, and we thought that we could make money that way easier. Nevertheless, after about 10 years, I came to know that money could not be made the way we imagined. Then in high school, we were told in our economics class that when every single currency bill is produced in the printing house, there should be put gold of equivalent value in the reserve banks.
I wanted to learn how the value of the currency was determined. I heard multiple times that gold and silver, sometimes finished goods and services those ready for sale and some other government fiscal factors did the determination, indicating that money bill cannot be printed out that easy anytime.
Very interestingly, this time, nothing is taking on board except orders from the financial gurus whether they are in Washington DC or in any parliaments. Currency bills are just printed out straight away whenever the powers want to do so, no matter what the consequence affects the future, especially, the massive poor people. The biggest apprehension and suspicion in the USA is that private bankers print out the bills at their advantage not by the public government in public interest and needs. Often times, I wanted to know from the economists and academic experts that how this magical power is created and manipulated.
If the bookish words and academic knowledge from the study field of economics carry value and truth, there would have a crystal-clear reality about money and currency character. A common-sense premise is that money bills have been printed out without any logical support and reserve. Simple evidence is that 30 years ago, one Indian Rupee could buy any regular product from the market which one hundred rupees can buy today at the same quantity. This reality is a self-explanation of inflation and depreciation, devaluation of money. If not – What is the inflation and the devaluation of money across the world?
Some 30 years ago, in most of the developing countries, one received 1000 bucks as their salary, the person could manage their family with the amount, today they receive 10-fold more, but could not manage the same volume of the family. The evidence is the ever-increasing number of banknotes and coins of the world are circulated among us but the value of money unit is way far behind.
According to an article, Currency in circulation, (Wikipedia, 1990); in 1990, total currency in circulation in the world passed $1 trillion. After 12 years, in 2002 this figure was $2trillion, and in 2008 it had increased to $4 trillion. The total value as of 31 December 2016 using the exchange rate was $4.687 trillion. China was not part of the calculation, and might be more than a trillion dollars. Over 160 countries were not calculated. The calculation also did not include Cryptocurrencies such as Bitcoin and Ripple, whose total value in circulation exceeds one hundred billion dollars (BIS, CPMI, 2020).
Recently, there is approximately $37 trillion in circulation: this includes all the physical money and the money deposited in savings and checking accounts. Money in the form of investments, derivatives and cryptocurrencies exceeds $1.2 quadrillion (Rank Red, 2020). In the 2019 list of world’s billionaires, Forbes included 2,153 billionaires with a total net wealth of $8.7 trillion (Forbes, 2019).
A tricky game about rich man’s money is – Whose government in the world has not borrowed money? Global debt across all sectors rose by over $10 trillion in 2019, topping $255 trillion. At over 322 percent of GDP, global debt is now 40 percentage points ($87 trillion) higher than at the onset of the 2008 financial crisis—a sobering realization as governments worldwide gear up to fight the COVID-19 pandemic (IIF, 2020). The USA leads the first position with $21 trillion that is 31 percent of the overall global share, Japan is in the second position with 17 percent, China with 9.8 percent and India with 2.8 percent, the biggest democracy in the world, so on and on; they are in debt in trillion and billion bucks (Visual Capitalist , 2019). In one sense, the whole world is in debt. Interesting – From whom do they borrow all this virtually uncountable money, and whose mystic money is that anyway?
Later in the face of the electronic tricky banking network and credit culture, the avatar of virtual money system (not of the cryptocurrency), and greater manipulation of money power is programmed by bankers and few super-rich people. This means, the sweeping majority of the global population are enforced to remain the victims of the poverty and economic challenge. Now, with all these trillion of money, only billions of poor people remain in poverty and face a hard time.
In the meantime, the coronavirus pandemic relates a demand to decode the mystic ability of money by utilizing them in the need of hours as such. For example, in the case of India, literally, piles of money are there in the temples and the billions of black money lying idle in the foreign banks. We heard that Narendra Modi propagated in the election campaigns that he would bring those black money to benefit the nation.
Interestingly, the mysterious power of money is obvious and effective even among the tribes across the world. Once uncontacted tribes come to contact with the civilized humans, and once they know the convenient life, easier means to get good food, to wear clothes and to build shelter, there is seen little difference in the money corrupts man.
Thousand years of their primitive outlook living in the jungle setting is changed by the awareness of a few years about the glamour world. The consumerism products and power of money have surprisingly the shortest period to alter these people in the jungles. Believed to be permanent traits of the tribes compromise themselves suddenly their distinct identity with modern money. We have seen these everywhere around the world. My personal field observation on the ground is very vivid among the tribes in the Indo-China region. In less than 5 years’ time, they know and adapt, to live in the consumerism world buying attractive whole range of Chinese made products, expensive vehicles from the Indian market and get built modern houses.
Excerpt from QUESTIONING DEVELOPMENT: Beyond the Corona Cage: (Kindle Publication, Amazon) by JN Lai, Asst Prof, University of Suwon, S Korea
