Wednesday, July 15, 2009

Money I$ Magic

I was buying some food today, holding a ratty $5 bill that I was about to hand over for some fries and a sandwich. Let me make clear that I was not high. But as I was handing over the bill, I was struck with a thought that overwhelms me from time to time: money is really fucking weird.

I was standing there, able to convert my ratty, purposeless piece of paper into food because of a magical belief system. I believed in the efficacy of money, as did the guy at the cash register; we believed in money because everyone else believed in money. Our collective faith in the floating signified signifier of the dollar (I WENT TO COLLEGE IN THE 90'S) infused it with power over all of us. It becomes the ultimate measure of all things. As Marx said, money "transforms fidelity into infidelity, love into hate, hate into love, virtue into vice, vice into virtue, servant into master, master into servant, idiocy into intelligence, and intelligence into idiocy." (Marx, 1844) And thus it enslaves us, and holds us in its thrall.

The practical effect of this: my willingness to sit in an office all day typing things for other people so they would give me magical paper that I could convert into things I needed to live (and things I didn't necessarily need to live).

That, of course, is just one view of money. Another view is that money is simply a shorthand, a way to translate values, a way to allow complicated transactions to be measured by one all-purpose measure of value -- the only way to conduct business in a complicated economy.

4 comments:

zeuqram said...

i don't doubt you weren't stoned when you paid for the lunch. but were you stoned when you wrote the post? :-)

the last paragraph is on the money.

as for the other, religious stuff: i'm not sure it's the paper money, per se, that's creepy, it's the way we set values on all instruments.

with paper currency, you're setting a value on the machinery of the state which can ensure that, at any point, you will be able to redeem that paper for an equitable valuable.

now, when people buy a painting knowing they will be able to exchange it for the same or more, well, wow. stock, scripts, etc.

no?

take care,
jose

Octopus Grigori said...

I can't believe you didn't correct my misuse of "signified". Of course, I paused for a second before correcting it just now -- wasn't I in effect saying in that paragraph that the belief in money made it into a type of "floating signified"?

Anyway, there is something different about paper money. It has no inherent value based on scarcity, etc. (compare gold, silver, platinum). (In fact, forget paper: imagine money is just data -- a certain number of digital units in an electronic account.) Once money is delinked from the gold standard, it truly is allowed to float free. There's no guarantee that you can actually redeem your cash. Yes, it's sort of based on the machinery of the state, but it's also not. See, for example, the use of U.S. currency in black market transactions outside the U.S. That argues more in favor of money being that thing that's most convenient (and accepted in the location of the transaction), easiest to store and transport, etc., as a universal measure of value.

And when money becomes data, and our ability to buy becomes based on our "credit," then we enter into the realm of statistical analysis, actuarial tables, projected risk, etc. That is, "money" becomes a projection or an analysis of what we are, what we can be or become. Credit (card) companies watch our behavior, our spending patterns, analyze our credit history, and dole out credit/money accordingly.

But there's something more to it, I think. In becoming not simply the unit by which to compare things, but a store of value (material, human, spiritual value) itself, money takes on stranger powers, more in the realm of psychology or faith than simple economics.

zeuqram said...

is your comment in response to my comment longer than your original post? that would be awesome.

i shouldn't have chosen paintings as they're one-off's – maybe limited edition prints. ;-) but i don't think we're in disagreement here. even in the black market, traders are banking on Pax Americana.

as for derivatives – and other financial instruments – i think it follows naturally that if you're willing to abstract one degree (you can exchange this paper for gold, really, we promise), you can abstract to the nth degree without any depreciation, just transaction fees. (you can exchange this code for another code that can be exchanged for paper that can be exchanged for gold – or whatever.)

i'm just not so sure that paper money has that magical allure. all i can think about is music videos (occupational hazard) and people are not creating piles of cash to sit on these days. so, i dunno, it may not have that allure anymore. like, if anything, it's tightly packed in a suitcase. at which point the suitcase is the signifier (if you must.)

:-)

Anonymous said...

Just try not to think about it too much - this may be the only way to keep the system running.