There is no doubt that money greatly promotes exchange. However, the reason why money has this function is "because everyone recognizes that money is a medium of exchange". This is very important, because people will naturally recognize a certain currency, such as US dollar, Japanese yen, euro, or RMB, ruble, Thai baht, or gold coins, silver coins, shells, or five-baht coins, knife coins, and Song copper ingots as a medium of exchange. Ordinary people often realize the value of a currency through repeated exchanges. For them, the value of money is very mysterious, and the change of value, like the change of weather, is an act of God. For economists, the change of money value depends on the ratio between the total amount of money issued and the total amount of goods, as well as the ratio between storage and direct circulation. For the currency issuing authority, the stability of the currency value is related to the credit of the monetary authority, that is, to the degree of people's recognition of the currency. However, when the effect of breaking promises is greater than that of keeping promises, it is possible for the monetary authorities to accumulate all social wealth into the hands of the monetary authorities by issuing money indiscriminately. For enterprises that want to open foreign markets and keep domestic markets, moderate currency depreciation can promote exports and curb imports. For currency speculators (foreign exchange speculators), whether a country's currency depreciates or appreciates, it may be an opportunity to make money or a trap to lose money. The key is how to raise a country's currency together and then make a move quietly (or vice versa). In fact, the value of a currency reflects the interaction of the above forces, especially the authority, strength and credit of the monetary authority (in modern countries, the monetary authority is actually the government). In modern society, the authority, strength and credit of the government depend on the complex cooperation and struggle of various social contradictions. Therefore, the value of money more broadly reflects all political, economic, cultural and technological contradictions and their interrelationships. Due to the widespread existence of international trade and investment, the change of a country's currency further comprehensively reflects various contradictory movements at home and abroad. For example, when we study the reasons for the change of the value of the dollar, all the contradictions in world history and contemporary times will unfold at different levels in the past 200 years (all economic and monetary history have explained this point, and people who have experienced the change of the value of the dollar will have a personal experience. Dollar and yen-Resolving the economic conflict between the United States and Japan can help people understand the complexity of currency changes. The book was co-authored by American Professor Ronald I. Mckinnon and Japanese Professor Ono Kenichi, translated by Wang xin and Cao Li, and published by Shanghai Far East Publishing House. See also my article "Mrs Deng, New Economy and Financial Bubble").
This means that, in essence, money is actually a digital expression of ideas, strengths and interests formed by mutual cooperation and conflict between people. If everyone is an economic man who pursues the maximization of personal interests, then the ideological pattern, power pattern and interest pattern are basically the same, and they will all present a pyramid shape. Its basic logic is the law of the jungle. Since 1980s, American society has been accelerating the integration of the three. If everyone is not selfish, the ideological pattern and power pattern may still be pyramidal, but the interest pattern will be flat, which is basically the case in traditional socialist society. If everyone is not selfish, the pattern of interests may be flattened to the greatest extent, followed by the pattern of strength, while the ideological pattern may still maintain a considerable pyramid structure, which may be the case in an ideal society.
Let's put aside the latter two for the time being and discuss the nature of money in the first case, because it is closest to the real society. In this case, money is first and foremost a digital expression of the interest pattern. How much money each person has is directly a pattern of interests. Things like houses, land or antique calligraphy and paintings used to be called real estate, which is difficult to realize. Now that the market is highly developed, they can also be directly realized (or mortgaged) as money. In this way, the monetary pattern is roughly equivalent to the interest pattern. Due to illness, marriage, market prosperity or depression, enterprise prosperity or bankruptcy, personal employment or unemployment, inheritance or theft, buying and selling stocks and futures, winning or losing, the fine pattern of personal interests is changing at any time. In contrast, a person's birth, status, ability, knowledge, professional quality and social network change much more slowly, and the social and political structure formed by the interaction between individuals changes even more slowly. These, we can call it the power pattern in the cage. The interest pattern and the power pattern are interactive, but the power pattern is more fundamental. From the case of Microsoft being split, we can see that Gates is actually an upstart. Although he originally came from a wealthy family, the social influence of the Gates family and its original circle of contacts are far from enough to support Gates to become the richest man in the world. Secondly, facing the empires of established companies such as General Motors, Boeing, United Steel, Citigroup, Kodak, Mobil, Hewlett-Packard and IBM. Microsoft's growth rate is explosive. Microsoft has not had time to use its huge monetary resources to establish a political protection system for its interests in Washington and academia. Therefore, Microsoft has become the object of implementation of the anti-monopoly law. The typical feature of nouveau riche is its rapid rise in the interest pattern, but there is no corresponding rise in the power pattern. If the nouveau riche does not distribute part of its interests to the powerful in the power structure, its interests will be easily violated. Indonesian Chinese have a relatively high economic status in Indonesia, but they are discriminated against politically. When social unrest occurs, China people become scapegoats and victims of the dominant social forces, their wealth is plundered, and even their lives are hard to protect. Ordinary people actually know this very well. When marrying a daughter-in-law or daughter, people often pay more attention to a person's social identity and status than cash. Because they have repeatedly realized in their lives that money without power is not enough. At first, those who made a fortune by raising chickens and ducks or selling mutton skewers and tea eggs often found all kinds of people around them playing tricks on them. If they don't pay tribute, not only their business may be destroyed, but even various accidents may occur. In fact, the phrase "breaking money and avoiding disasters" typically expresses the relationship between the pattern of interests and the pattern of strength.
On the contrary, if a person's position in the power structure rises, his interest position can often rise steadily accordingly, which is manifested in the steady growth of monetary income. The well-known "promoting to a higher position and getting rich" actually expresses this logic. From the sociological point of view, if the power of a certain group in the power structure rises, the interests of that group will also rise accordingly. For example, during the Great Depression of 1930s, the powerful workers' movement forced the Roosevelt authorities to legalize workers' right to organize and strike. Since then, the bargaining power of workers has been significantly enhanced, and the living conditions and monetary income of the whole group have been improved. Of course, the further improvement of workers' status was strongly resisted by management. In 1950s and 1960s, on the one hand, workers' nominal wages rose, on the other hand, employers raised prices, resulting in spiraling inflation caused by so-called wage rigidity. In the spiral inflation, on the surface, the monetary income of everyone in the whole society has increased, but in fact, the price has returned, and the interest pattern of workers and employers has remained unchanged. The reason behind it is precisely that the power struggle between workers and employers is in a stalemate and stalemate. What breaks this relative balance is to allow employers to invest overseas freely. 197 1 after the collapse of the Bretton Woods system, major companies in the United States (as did Japan and European countries) closed their factories one after another, moved their manufacturing industries to third world countries, and used the low wages of third world workers to increase profits. For the workers in Detroit, this means that the workers in the third world who have long been separated from the factory by national borders will become their competitors. The result of the strike and negotiation will be that the boss moves out of the factory and takes his job. Therefore, since the 1970s, the real income of American workers has gone from bad to worse, and social welfare has been cut continuously.
Sometimes, the pattern of power and interests will obviously deviate. For example, at the beginning of shock therapy in Russia, the Russian political elite gained absolute dominance in culture, economy, politics and military affairs, but the pattern of social interests also inherited a relatively flat socialist heritage. After the implementation of shock therapy, inflation was as high as dozens of times, and ordinary Russians were suddenly penniless, while Russian political elites took huge state assets for themselves, forming seven consortia, and re-realizing the consistency of power pattern and interest pattern. For another example, during the period of 1948- 1949 in China, Chiang Kai-shek Group still held absolute sovereignty over Kuomintang-controlled areas, but conventional financing channels such as taxation and national debt were no longer sufficient to support a large-scale war, that is, the group had fallen into the bottom of the tower in terms of interest pattern. But it doesn't matter, we can collect bits and pieces of folk wealth resources by spamming money, so that the power pattern and interest pattern are consistent. Chiang Kai-shek and Shanghai speculators have long understood the mystery that the pattern of power determines the pattern of interests. Chiang Kai-shek issued high-interest government bonds every year, relying on new debts to repay old debts to support finance. Government debt is getting heavier and heavier. As usual, people with high debts are unlikely to continue to borrow new debts. However, otherwise, because the Chiang Kai-shek clique is at the core of the power structure, it can't even confiscate a large number of private assets, and it can't engage in hyperinflation. There is no need to worry about its debt repayment. In the case of hyperinflation, the pattern of interests is almost completely adjusted according to the pattern of power. For example, people who work in social and political power centers such as the army, the police, the courts and the media can get a salary increase close to the inflation rate first, while others get corresponding monetary income according to their position in the social power structure. Of course, extremes meet. When the strong in the existing power structure excessively deprives the weak, the power structure may be reorganized to achieve the relative balance between the strong and the weak. This is all kinds of coups, rebellions and revolutions. The so-called social unrest is actually the fundamental turmoil in the power structure. Every time the structural turmoil of a big country ends, it is often a complete replacement of money or a re-determination of the value of money. The new stable currency actually means the establishment of a new power structure. In other words, the change of money and its value in modern society reflects the change of political power and strength.
This feature is actually suitable for the era when private banks or private banks can issue their own money. When a private bank is strong and well-run, its currency value is relatively stable and its issuance scope is relatively wide, so many people will use this currency as storage. In this way, banks may absorb a large amount of social funds, lend widely, and collect the difference between deposits and loans. However, it is often followed by the bureaucratization of banks, rising operating costs, and employees at all levels of banks using their powers to seek their own interests, which leads to the decline of loan quality, the increase of bad debt rate and the gradual insolvency of banks. In other words, there will be extensive conflicts between bank ownership and management rights, and a pyramid-shaped power structure will be formed within the bank, which may absorb the difference between deposits and loans. Faced with this situation, bank bosses are unlikely to adjust the internal power structure. The only possible countermeasure is to transfer the contradiction to customers, absorb deposits at higher interest rates, and then declare the bank bankrupt, and the issued currency will depreciate sharply.
It is precisely to prevent private banks from engaging in credit fraud and causing local social unrest that countries have set up central banks. However, this is actually only the transfer of credit fraud right from private banks to central banks. Today, the currency issued by the United States has become the main settlement currency of international trade and the main composition of foreign exchange reserves of various countries. This means that the Federal Reserve has become the world's central bank to a certain extent and has the right to commit credit fraud to the world. It is precisely because of this advantage that the United States can implement large-scale deficit finance for a long time, use the deficit to expand its armaments, and attract foreign exchange in dollars stored by various countries to return to the US Treasury bond market at high interest rates. Although the final result is bound to be a sharp drop in the dollar, during this period, resources from all over the world have continuously flowed into the United States.
The sharp decline of the dollar will inevitably lead to great turmoil in the power structure and interest structure around the world, and the essence of money will be more recognized by people. Only from this perspective, the dollar crash has its positive significance.