discuss the theoretical and empirical definition of money.
Answers
Explanation: IN Simple Terms ,
Money, currency, are mediums of value exchange. Today it has no intrinsic value. Gold today has bullion value and can be traded for other goods, a long standing use, but it has become too scarce to be suitable. Today value is assigned according to laws and trade values using money as a token. Only 3% of money in circulation is in notes and coins, the rest is electronic. A $100 bill costs 4 cents to print. That sort of seigniorage is not used in trading or value assigning. Instead money comes from “thin air” as permitted in the constitutions national and federal governments have to follow. For money to exist it has to be assigned to debt. Like electricity, it’s only available when you turn the switch and get work from it. Debt does that.
Governments can force acceptance of their chosen token. They allow banks to create money as credit. We too can create credit, through bank cards etc. Bank money is a liability. It has to be paid back. Sovereign government money is created by spending it into existence. That way it has no liability and does not have to be paid back. Liability is extinguished whenever the Federal banks pay for government expenses. A Federal Government therefore has zero need to borrow or to save in its own currency. It simply pays when the debt arises, which also means there are no unfunded, forward liabilities. Federal governments basically are never in debt, except for the intervals between receiving and paying for its obligations, etc. Any other interpretation is just political mischief.
[reference from quora ,2019]